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One of the nation’s largest cities may soon find itself a major test case for the limits of the antidiscrimination provisions of the Americans With Disabilities Act (ADA).
On November 12 a former employee of the city of San Diego filed a lawsuit charging that city officials are violating the law by offering disability insurance coverage whose provisions discriminate against people with mental illnesses.
Jenny Badua, a 40-year-old former San Diego government employee, was placed on long-term disability in 1994 after she was diagnosed with bipolar disorder. Unlike workers disabled with physical illnesses, however, who are eligible for payments until age 65 under San Diego’s policy, Badua’s disability benefits were terminated after two years, the limit imposed on individuals suffering from "mental and nervous" disabilities.
To make matters worse in the minds of advocates for the mentally disabled, soon after the ADA went into effect, San Diego changed the terms of its disability insurance policy to bar mentally disabled workers from collecting any disability payments through the city’s plan.
Badua’s lead attorney, Linda D. Kilb of the Disability Rights Education and Defense Fund (DREDF), said at a press conference announcing the suit that San Diego’s treatment of its mentally disabled employees is an example of policymaking based on "unfounded fears and stereotypes." To guard against just this type of discrimination, Kilb added, the ADA’s regulations require employers who want to be exempt from the law to "demonstrate correlations between disability and costs based on sound actuarial principles," a mandate with which San Diego has failed to comply.
That San Diego changed the terms of its disability policy after the ADA took effect so that payments for psychiatric disabilities are totally excluded is evidence that "the city shares the societal impulse to view mental illness as not real and to consider it the fault of the person with the diagnosis," Kilb told Psychiatric News. "The perception is that these disorders and the way they are treated are all subjective," though psychiatrists and others know that outcomes can be quantified and treatments evaluated.
In explaining her decision to sue the city, Badua said that "the financial consequences of the city’s actions have been devastating to my family, but the emotional impact has been equally great. The city waves diversity as a banner of different threads, each thread representing cultural, ethnic, gender, and disability differences, woven together with the slogan ‘Diversity brings us all together.’ My difference, however, is not woven into the design. I am the invisible thread left out of the banner."
Badua stressed that she is prepared to deal with the ways her illness has changed her life, but that she refuses to "tolerate the city’s discriminatory response to it."
The DREDF, which is based in Berkeley, Calif., is a nonprofit law and policy organization that specializes in disability rights law. Also representing Badua in her suit are the ACLU Foundation of San Diego and Imperial Counties, the ACLU Foundation of Southern California, and the San Diego office of the law firm Milberg Weiss Bershad Hynes and Lerach.
A continent away, a lawsuit charging a bank with an identical form of discrimination against a former employee is about to go to trial—the first such case to reach that stage. That case was filed in a federal district court in New York in 1995 and has received major financial support from the New York State Psychiatric Association and APA’s litigation fund (Psychiatric News, October 20, 1995; April 4, 1997).
The plaintiff, identified as Leonard F., age 51, sued the Israel Discount Bank of New York for limiting his disability benefits to two years. It too provides disability insurance coverage that allows physically disabled employees to collect benefit payments until they reach age 65. Leonard F. had retired on disability with a diagnosis of acute and chronic depression that was "aggravated by work-related factors," according to his suit, which also noted that he met the disability criteria stipulated in the ADA.
The ADA requires that to be covered by its antidiscrimination protections, an individual’s disability must "substantially limit one or more major life activity," such as the ability to perform his or her job. Leonard F. had been an assistant vice president of the bank and had worked there for seven years.
According to the ADA, which went into effect in 1992, employers with at least 15 workers are prohibited from discriminating against those with disabling mental or physical conditions in any phase of employment, including fringe benefits, unless the employer can provide actuarial data proving that accommodating disabled individuals will lead to an increase in their insurance risk.
Last month the judge in the case of Leonard F. v. Israel Discount Bank of New York denied a motion for summary judgment that the bank’s attorneys had filed. The judge’s refusal to dismiss the case indicates that "he determined that the factual issues involved require that a full trial record be prepared," attorney Seth Stein told Psychiatric News. Stein is co-counsel for Leonard F. and is also executive director of the New York State Psychiatric Association.
The federal Equal Employment Opportunity Commission (EEOC) has also entered the case on behalf of Leonard F. In past rulings interpreting ADA requirements, the EEOC has stated that the law does not require employers to cover mental disorders at parity with physical ones in health insurance policies, but failure to do so in disability policies does violate the law. In the latter, the EEOC maintains, anyone entitled to the policy’s benefits has already met criteria for a serious disability and thus cannot be treated differently by the employer from any other disabled person. The source of the disability is irrelevant for this category of employee benefit, according to the EEOC.