In Lyn M. v. Premera Blue Cross, 966 F.3d 1061, 1065 (10th Cir. 2020), a case involving the denial of ERISA-governed medical benefits, the three-judge panel including Judges Lucero, Bacharach, and Eid (dissenting) determined that “the court must in de novo review of the denial of benefits because members lacked notice of the plan administrator’s discretionary authority.” Specifically, discretionary authority was contained in a document called the “Plan Instrument” but plan participants had no way of knowing this document existed, and thus lacked sufficient notice to trigger arbitrary-and-capricious review.

On April 5th, in Lyn M. v. Premera Blue Cross, No. 18-4098, __F.3d__, 2021 WL 1257239 (10th Cir. Apr. 5, 2021) (Before Briscoe, Lucero, Hartz, Holmes, Bacharach, Phillips, Moritz, Eid, and Carson, Circuit Judges), the Tenth Circuit denied Premera Blue Cross’s Petition for Panel Rehearing and Rehearing En Banc because only Judge Eid would grant panel rehearing. Of the non-recused judges, only Judges Hartz, Eid, and Carson would grant en banc rehearing. Judge Bacharach filed a separate concurrence in support of the denial of en banc rehearing, joined by Judges Briscoe and Lucero. Judge Eid filed a separate dissent, joined by Judges Hartz and Carson.

The concurrence, which addressed Judge Eid’s dissent, explained that the panel opinion does not expand a plan administrator’s duties under ERISA to notify members about a plan’s provisions as this issue was not addressed.

“The panel opinion simply holds that

  • the federal common law’s arbitrary–and–capricious standard of review applies only if participants obtain notice of the plan administrator’s discretionary authority,
  • notice requires at least something that would alert participants to the existence of a document reserving discretion to the plan administrator, and
  • such notice was absent here.

This case–specific, fact–bound opinion does not expand a plan administrator’s duties under ERISA.” An administrator cannot furnish notice through a “secret document containing clear language.” The opinion does not conflict with the Second Circuit’s opinion in Thurber v. Aetna Life Insurance Co., 712 F.3d 654 (2d Cir. 2013). That case dealt with whether lack of actual notice was sufficient to trigger de novo review where the participant knew about the summary plan description, which contained the discretionary language, but did not receive a copy of it. Here, the participants had no way of knowing about the document reserving discretion. Finally, the panel opinion does not create a slippery slope of expanding a plan administrators’ duties to provide notice of specific documents affecting claims-handling procedures or coverage decisions as those documents do not impact the standard of review. “Little reason exists to convene en banc to revisit this unremarkable application of the federal common law to the standard of review.”