Parker v. Metropolitan Life Insurance
21 Employee Benefits Cas. (BNA) 1369, 6 Am. Disabilities Cas. (BNA) 1865, 121 F.3d 1006 (1997)
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Rule of Law:
Title III of the Americans with Disabilities Act (ADA), which prohibits discrimination in places of public accommodation, applies only to physical spaces and regulates access to goods and services, not the substantive content of those goods, such as the terms of an employer-provided insurance policy. The ADA prohibits discrimination between disabled and non-disabled individuals, not between individuals with different types of disabilities.
Facts:
- Ouida Sue Parker was employed by Schering-Plough Health Care Products, Inc.
- During her employment, Parker participated in a long-term disability plan offered by Schering-Plough and issued by Metropolitan Life Insurance Co. (MetLife).
- The plan provided benefits for individuals with physical disorders until they reached sixty-five years of age.
- For individuals with a mental or nervous disorder, the plan limited benefits to a maximum of twenty-four months.
- On October 29, 1990, Parker became disabled due to severe depression.
- After receiving benefit payments for twenty-four months, MetLife and Schering-Plough terminated her payments pursuant to the plan's terms for mental disorders.
Procedural Posture:
- Ouida Sue Parker filed an action in the District Court against Schering-Plough and MetLife, alleging violations of the Americans with Disabilities Act (ADA) and the Employee Retirement Income Security Act (ERISA).
- The District Court granted the defendants' motion for summary judgment on all claims.
- Parker appealed to the United States Court of Appeals for the Sixth Circuit.
- A panel of the Sixth Circuit affirmed the dismissal of the ERISA and Title I ADA claims but reversed the dismissal of the Title III ADA claim.
- The defendants-appellees, Schering-Plough and MetLife, sought a rehearing en banc on the Title III issue, which the Sixth Circuit granted, vacating the panel's judgment.
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Issue:
Does Title III of the Americans with Disabilities Act (ADA) prohibit an employer from providing a long-term disability plan, issued by an insurance company, that contains different benefit periods for mental and physical disabilities?
Opinions:
Majority - Kennedy, J.
No. Title III of the ADA does not prohibit such a distinction because an employer-provided benefit plan is not a good offered by a physical 'place of public accommodation,' and the ADA does not mandate equality between different types of disabilities. First, the court reasoned that a 'public accommodation' under Title III is a physical place, such as an insurance office. Parker obtained her benefits through her employer, not by accessing a public office, so there is no nexus between the alleged discrimination and a place of public accommodation. Second, Title III governs physical access to goods and services, not the content of those goods; for example, a bookstore must be accessible but is not required to stock Braille books. Third, discrimination in employment benefits is the exclusive province of Title I of the ADA, not Title III. Finally, the ADA prohibits discrimination between disabled and non-disabled persons, not between individuals with different disabilities; because all employees were offered the same plan, there was no discrimination in accessing the benefit.
Dissenting - Martin, C.J.
Yes. The majority incorrectly limits Title III to physical structures, contrary to congressional intent. The dissent argues that the majority misinterprets precedent, stating that an 'insurance office' is explicitly listed as a 'public accommodation' and this term is not limited to brick-and-mortar buildings. This interpretation creates an absurd result where individuals who purchase insurance in person are protected by the ADA, while those who do so by mail, phone, or through an employer are not. As commerce increasingly moves away from physical locations, the majority's holding will dilute the protections Congress intended to provide.
Dissenting - Merritt, J.
Yes. The majority's conclusion that employer-sponsored insurance plans are not covered by Title III renders Title IV's 'safe harbor' provision for insurance practices meaningless. The dissent argues that Congress would not have included a specific section outlining permissible insurance practices if it did not intend for the ADA to apply to insurance in the first place, including the millions of policies provided through employers. Legislative history confirms that Congress intended the ADA to cover such plans, allowing distinctions only if based on 'sound actuarial principles.' The majority's holding creates an 'absurd result' by protecting the few who buy insurance by walking into an office but not the millions who receive it through their employment.
Analysis:
This decision significantly narrows the scope of Title III of the ADA by holding that it applies only to discrimination related to physical places of public accommodation. It establishes that challenges to the substantive terms of an employer-provided benefit plan must be brought under Title I, which may preclude claims by former employees who are no longer 'qualified individuals.' The ruling permits insurers to differentiate between mental and physical disabilities in benefit plans, reasoning that the ADA mandates parity between the disabled and non-disabled, not among different classes of disabled individuals. This interpretation has a lasting impact on disability law, reinforcing a distinction between access and content that limits the ADA's reach into the design of insurance products.
