Judges rule on pre-existing condition case

Highlighting the highly controversial health care debate that’s played out during the past year, the 7th Circuit Court
of Appeals today ruled on a pretty straightforward case about a pre-existing condition clause that denied a man’s claim
for long-term disability benefits.

Judge Terry Evans wrote for the unanimous panel, affirming a decision from Judge Larry McKinney in the Southern District
of Indiana that had rejected the man’s Employment Retirement Income Security Act suit and granted summary judgment in
favor of the employer. The case is The Estate of Norman Blanco, by its personal representative Steven C. Blanco v. Prudential
Insurance Company Of America, Pruvalue Insurance Benefits Trust, and Porsche Engineering Services Inc., No.
08-2074.

“The phrase ‘preexisting condition’ was frequently in the news as efforts to enact national health care
reform were debated over the last year,” Judge Evans began in the ruling. “And although our case today involves
a preexisting condition exclusion, there is a twist.”

Now deceased, Norman Blanco had started at the age of 45 as an engineer at Porsche Engineering Services in Michigan in April
2005. His company’s welfare benefit plan covered by ERISA kicked in a month later and was underwritten and administered
by Prudential Insurance, providing long- and short-term disability benefits to those who couldn’t work. Blanco suffered
a heart attack in July and was unable to work for several days while hospitalized, and he later submitted a disability benefit
claim. The short-term benefits were approved, but the long-term benefits weren’t because Prudential determined he had
a preexisting condition based on a history of worsening heart disease and prior heart attacks and treatment that he didn’t
always adhere to.

At the District Court level, Judge McKinney granted a summary judgment motion by Prudential Insurance, which had upheld the
claim denial during an internal review process. The trial judge had limited some of the evidence in that case, and the appellate
panel affirmed his decision. Blanco died following that decision, and his estate carried on the appeal.

Analyzing Judge McKinney’s ruling, the 7th Circuit decided that Blanco did fall under the pre-existing exclusion sections
of ERISA and couldn’t receive those long-term benefits.

“The purpose of the policy is to exclude from coverage a person who is aware of something – be it a sign or symptom
– for which a reasonably prudent person should seek treatment,” Judge Evans wrote.