Defining "Mental Illness"
Many disability and health insurance policies contain limitations or exclusions of coverage for mental illness. We have a tendency to think we know the difference between a mental and a physical disorder when we see it. But without more definition as to what insurers mean when they use the phrase “mental illness” in a policy, it can be very difficult to know what a consumer relying on coverage can reasonably expect the insurer will cover and what it will exclude.
Recently the U.S. Court of Appeals for the Eleventh Circuit issued a decision that discusses this problem at some length. In Billings v. UNUM Life, 459 F.3d 1088 (11th Cir. 2006) a pediatrician with obsessive compulsive disorder reached a point where he could no longer practice medicine in his specialty. He filed a disability claim. UNUM’s disability policy limited benefits for disability due to mental illness to 24 months and UNUM cut Billings off after 2 years of coverage. Dr. Billings presented information to UNUM, which the insurer did not dispute, showing that his OCD had a physical cause. Consequently, Billings argued that the 24 month mental illness limitation did not apply. The trial court ruled in favor of the claimant, UNUM appealed and the Eleventh Circuit upheld the trial court.
The court ruled that the policy language was ambiguous because it did not make clear whether an illness would be classified as “mental” based on its symptoms or its cause. For Dr. Billings, the illness may have manifested itself in a way that could be classified as “mental” but it had a physical cause. Consequently, the court ruled that the ambiguous language would be construed against the insurer. This rule of giving the insured the benefit of the doubt when dealing with an insurance policy’s unclear language is a rule of contract interpretation, contra proferentem, that has been adopted in every state as to how to interpret ambiguous insurance policies.
The idea that illnesses can be easily split between “mental” and “physical” is a questionable distinction to begin with. The Diagnostic and Statistical Manual of Mental Disorders, the bible across the medical field for diagnosis of psychological and mental conditions, points out in its preface that the mental/physical distinction is largely artificial. But the lesson Billings teaches is that if health or disability insurers want to rely on those categories to define and limit coverage, they should do so using precise language with specific examples. Otherwise, the risk of loss after a claim arises should fall on the insurer.