ERISA: Is risk of relapse a disability?

This ERISA long-term disability case brings an interesting question.  Is an individual still disabled even though the disabling event has already passed – just because of the possible risk of relapse?  In other words, if person A had a disability event in 2000, is person A still considered disabled just because of what might or might happen in the future?

In Colby v. Union Sec. Ins. Co., 11-2270, the First Circuit Court of Appeals decided just that.  In this case, the issue was whether the future risk of relapse by an anesthesiologist who had been diagnosed with addition rendered the anesthesiologist disabled for purposes of a long-term disability policy.

The First Circuit Court of Appeals decided this case based on the language of the policy.  Under the policy language, covered “sickness” including mental health issues, including substance abuse, dependence, and addiction.  While in treatment, plaintiff’s doctors consistently held that the risk of relapse was “high” and recommended plaintiff not return to work for a period of 6 months.  Shortly thereafter, plaintiff relapsed.  After the relapse and due to the continuing high risk of relapse, plaintiff’s doctors agreed plaintiff should remain disabled for some period of time after plaintiff’s discharge.

This case arose because the the insurance company maintained that the risk of relapse (regardless of the degree) did not constitute as a disability under the plan.

After looking at the policy language, the First Circuit Court of Appeals disagreed.  There was nothing in the policy that stated that risk of relapse should not be covered as a disability.  The court stated,

To begin, the language of the plan admits of no such categorial bar.  It does not mention risk of relapse, let alone exclude risk of relapse as a potential basis for a finding of disability.

In the words of the Boston ERISA Law Blog:

So there you have it: if you don’t want to cover the currently rehabilitated participant whose risk of relapse means he can’t go back to work, you better write that down somewhere in the plan or the policy.

via Is the Risk of Relapse a Disabling Condition for Purposes of an LTD Policy? : Boston ERISA Law Blog.

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