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Baker v. Aetna Life Insurance Co.

United States District Court, N.D. Texas, Dallas Division

May 9, 2017

AETNA LIFE INSURANCE CO., et al., Defendants.



         Plaintiff Charlize Marie Baker (“Baker”)-who is undergoing the process of gender transition from male to female-sues defendant Aetna Life Insurance Company (“Aetna”), seeking to recover short-term disability benefits under an ERISA[1]-qualified short-term disability benefits plan (“STD Plan”) following breast augmentation surgery. Following a bench hearing, and for the reasons that follow, the court holds that Aetna gave a legally correct interpretation to the STD Plan and did not abuse its discretion in denying Baker's claim. The court therefore enters judgment in favor of Aetna.[2]


         Baker is an employee of L-3 Communications Integrated Systems, LP (“L-3”) and a participant in the company's ERISA-qualified health benefits plan (“Health Plan”) and STD Plan. Aetna is the third-party administrator of the Health Plan and the claim fiduciary and administrator of the STD Plan.

         In 2011 Baker began the process of gender transition from male to female. Baker was advised during her transition by Feleshia Porter, M.S., L.P.C. (“Porter”), a licensed professional counselor. As part of Baker's gender transition, she underwent hormone replacement therapy, which was covered under the Health Plan. Baker developed size B-C breasts as a result of hormone replacement therapy. In 2015, after consulting with Porter, Baker underwent breast augmentation surgery (i.e., implant surgery). Baker sought benefits from Aetna under the STD Plan for her post-surgery recovery.

         In considering Baker's claim, Aetna relied on her medical records, including records from her plastic surgeon, Scott Harris, M.D. (“Dr. Harris”), and Baker's own disclosures in the claim documentation. Dr. Harris' records described the surgery as a breast augmentation. And on the Aetna claim form, Baker answered the question, “What is the primary medical condition that keeps you from working?” with the response, “cosmetic procedure.” P. App. 5. Aetna denied Baker's claim on the ground that her surgery was not caused by an illness, injury, or pregnancy-related condition, as required for coverage under the STD plan. Aetna informed Baker by letter and telephone call of the denial. Aetna's letter also informed Baker of her right to appeal the decision, and to submit additional documents and records.

         Baker appealed Aetna's initial denial.

         Baker submitted two letters in support of her appeal. The first, from Dr. Harris, stated that “[t]his surgery was for a breast reconstruction for her transgender surgery that she was interested in having done. Transgender surgery, as you know, has become a functional indication for surgery.” P. App. 83. The second letter, from Porter, stated:

Charlize Baker has been going through gender transition[.] . . . Therapeutic issues we have addressed include family; self esteem; motivation for physical alterations; and permanent effects of gender transition. In March of this year my client received her first medically necessary surgery. Breast augmentation is considered reconstructive and necessary in body feminization.

Id. at 84.

         Aetna denied Baker's appeal, once again finding that the surgery did not meet the plan criteria of being medically necessary and due to an illness, injury or pregnancy-related condition. In its letter informing Baker of the appeal decision, Aetna wrote that all information in the claim file had been considered, including the letters from Porter and Dr. Harris. Aetna stated that, although it was aware that Baker had been undergoing gender transition since 2011, Baker had continued working during that time, and the evidence did not establish that her breast augmentation surgery was medically necessary and due to an illness.

         Baker filed this lawsuit against Aetna and L-3. In a prior memorandum opinion and order, Baker v. Aetna Life Ins. Co., ___ F.Supp.3d ___, 2017 WL 131658 (N.D. Tex. Jan. 13, 2017) (Fitzwater, J.), the court dismissed Baker's discrimination claim against Aetna and L-3 under § 1557 of the Patient Protection and Affordable Care Act, id. at *4; dismissed Baker's alternative ERISA-based discrimination claim, id.; dismissed Baker's claim against Aetna for sex/gender discrimination, in violation of Title VII of the Civil Rights Act of 1964 (“Title VII”), 42 U.S.C. § 2000e et seq., id. at *5; and denied L-3's motion to dismiss Baker's Title VII claim, id. Baker's ERISA claim (other than the alternative discrimination claim) against Aetna and her Title VII claim against L-3 remain for adjudication. Id. The court today addresses Baker's ERISA claim against Aetna.


         An ERISA plan participant who is denied benefits can sue to recover them. See 29 U.S.C. § 1132(a)(1)(B). This court has jurisdiction to review determinations made by an ERISA employee benefit plan. See, e.g., Vega v. Nat'l Life Ins. Servs., Inc., 188 F.3d 287, 295 (5th Cir. 1999) (en banc), overruled on other grounds by Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 119 (2008). In conducting this review, the

plan administrator's factual determinations are always reviewed for abuse of discretion; but its construction of the meaning of plan terms or plan benefit entitlement provisions is reviewed de novo unless there is an express grant of discretionary authority in that respect, and if there is such then review of these decisions is also for abuse of discretion.

Vercher v. Alexander & Alexander Inc., 379 F.3d 222, 226 (5th Cir. 2004). In this case, the parties agree that the STD Plan grants Aetna discretionary authority to construe the plan's terms. Accordingly, review of Aetna's construction of the meaning of plan terms or plan benefit ...

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