McNeil v. Time Insurance Co., 205 F.3d 179 (5th Cir. 2000)

This Fifth Circuit opinion affirms summary judgment against an HIV-positive man whose health insurer limited his coverage because he had AIDS. The policy had no limitations due to pre-existing conditions, but limited its coverage for the first two years of the policy if the insured had AIDS. The plaintiff brought claims under a Texas statute prohibiting discrimination due to disability as well as Title III of the Americans with Disabilities Act (ADA). With regard to the state anti-discrimination statute, the Fifth Circuit held that, although the plaintiff might be “disabled” within the meaning of the state statute, the insurance company did not discriminate against him because: (1) the insurer did not know the plaintiff had AIDS when it issued the policy; (2) even if the insurer had known, terms of a policy that are applicable to everyone do not discriminate against an individual. With regard to the ADA claim, the court held that the plaintiff was “disabled” under the ADA but that the Title III of the ADA prohibits only interfering with access to or the enjoyment of goods and services, and not the content of the goods and services themselves. The court held that, because the content of the policy was at issue, rather than access to the policy, there was no ADA violation.

The court’s interpretation of “discrimination” in these cases is extremely limited and short-sighted. In its analysis of the state law claim, the court failed to give weight to the fact that terms of a policy in themselves can be blatantly discriminatory. Discriminatory terms, even if applicable to everyone, are still discriminatory; indeed, most blatantly discriminatory policies are equally applicable to all, such as segregation laws or laws denying same-sex couples equal rights. In its ADA analysis, the court’s limited definition of “access” or “interference with the enjoyment of” to exclude the terms of an insurance policy ignores that fact that discriminatory insurance policies by their very terms provide unequal access, as the Second Circuit has held in Palozzi v. Allstate Life Insurance Co., 198 F.3d 28, 33-34 (2d Cir. 1999). Unfortunately, the Third and Seventh Circuits have agreed with the Fifth Circuit on this interpretation of Title III of the ADA.