Absence of “objective findings”

In Dunda v. Aetna Life Ins. Co., 2016 U.S.Dist. Lexis 85549 (W.D.N.Y. June 30, 2016), Aetna denied a claim for LTD benefits based on the absence of “objective findings” verifying the plaintiff’s subjective complaints of limitation.  Thus, Aetna’s denial of the claim was based essentially on a credibility determination. The Court found the determination to be arbitrary and capricious:

The Plan afforded Aetna the authority to require that Plaintiff undergo an IME. Under these circumstances, the Court finds that Aetna’s decision to not perform this examination supports the finding that its determination was arbitrary and capricious.

Dunda v. Aetna Life Ins. Co., 2016 U.S. Dist. LEXIS 85549 * (W.D.N.Y. June 30, 2016)

 

6th Circuit: denial on basis of credibility without physical examination supports finding of arbitrary and capricious

In Godmar v. Hewlett-Packard Co., 631 Fed.Appx. 397 (6th Cir. 2015), the Court re-affirmed the notion that when LTD carrier denies a claim based on credibility findings concerning the plaintiff’s pain, without conducting a physical examination,  it will support a finding that the decision was arbitrary.

Like the administrators in Smith and Shaw, Sedgwick decided that Godmar’s pain was subjective without examining him, and that failure weighs in favor of a determination that the denial of his claim was arbitrary and capricious.

Godmar v. Hewlett-Packard Co., 631 Fed. Appx. 397 *, 2015 U.S. App. LEXIS 21467, 2015 FED App. 0801N (6th Cir.), 2015 WL 8290186 (6th Cir. Mich. 2015)

Contacting the Treating Physician

In most ERISA LTD claims, the insurance company will hire a physician, usually an employee of the insurance company, to review the medical records and give an opinion on the claimant’s functional limitations.  Said physicians are often called “reviewing physicians.”  Generally, the insurance company’s reviewing physician will try to contact the claimant’s treating physician(s).

In Shaw v. AT&T Umbrella Benefit Plan No. 1, 795 F.3d 538 (6th Cir. 2015), the Court made specific note of the fact that the Plan failed “to make a reasonable effort to speak with” the claimant’s treating physicians.  In Shaw, the reviewing physicians attempted to contact the claimant’s treating providers; however, the treating providers were only permitted 24 hours to return the phone call.  The Court noted: “the cursory manner in which the Plan attempted to contact Shaw’s treating physicians is evidence that the Plan’s decision was not ‘the result of a deliberate, principled reasoning process.'”

Ignoring Favorable Evidence

LTD carriers are not permitted to ignore favorable evidence in a long term disability claim. “A plan may not reject summarily the opinions of a treating physician, but must instead give reasons for adopting an alternative opinion.”  Elliott v. Metro. Life Ins. Co., 473 F.3d 613, 620 (6th Cir. 2006).

What guides the Court’s decision?

In Shaw v. AT&T Umbrella Benefits Plan No. 1, 795 F.3d 538 (6th Cir. 2015), the 6th Circuit Court of Appeals outlined the standard of review as follows:

Under the arbitrary-and-capricious standard, we must uphold the plan administrator’s decision if it is “the result of a deliberate, principled reasoning process” and “supported by substantial evidence.” DeLisle v. Sun Life Assur. Co. of Canada, 558 F.3d 440, 444 (6th Cir. 2009) (quoting Glenn v. MetLife, 461 F.3d 660, 666 (6th Cir. 2006)). “When it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome, that outcome is not arbitrary or capricious.” Davis v. Ky. Fin. Cos. Ret. Plan, 887 F.2d 689, 693 (6th Cir. 1989) (internal quotation marks omitted). However, arbitrary-and-capricious review is not a “rubber stamp.” Cox v. Standard Ins. Co., 585 F.3d 295, 302 (6th Cir. 2009). “Several lodestars guide our decision: ‘the quality and quantity of the medical evidence’; the existence of any conflicts of interest; whether the administrator considered any disability finding by the Social Security Administration; and whether the administrator contracted with physicians to conduct a file review as opposed to a physical examination of the claimant.” Fura v. Fed. Express Corp. Long Term Disability Plan, 534 F. App’x 340, 342 (6th Cir. 2013) (quoting Bennett v. Kemper Nat’l Servs., Inc., 514 F.3d 547, 552-53 (6th Cir. 2008)).

Shaw v. AT&T Umbrella Benefit Plan No. 1, 795 F.3d 538, 2015 U.S. App. LEXIS 13194, 2015 FED App. 0171P (6th Cir.), 60 Employee Benefits Cas. (BNA) 1723 (6th Cir. Mich. 2015)

If your long term disability claim has been denied, contact The Hamilton Firm for a free consultation: 423 634 0871

Private Long Term Disability Policy

If you have a private long term disability policy, or a similar type of contract that pays benefits while you are unable to work, state law may assist you in your claim.  For example, in Georgia, a policy is to be construed liberally in favor of coverage.  Barrett v. Nat’l Union Fire Ins. Co. of Pitt., 304 Ga.App. 314 (2010).  If you have an insurance policy and you live in Georgia, contact our office if you are not receiving benefits you feel you are entitled to receive. We may be able to help. 

Heimeshoff v. Hartford Life & Accident Ins. Co

Yesterday, the United States Supreme Court decided a very important case in the context of ERISA long term disability.  The plaintiff filed a claim for long term disability benefits, which was denied by the Hartford.  Almost three years after the denial, but more than three years after the date proof of loss was due under the Policy, the Plaintiff filed suit.  The Policy contained a contractual statute of limitation providing that suit must be filed within three years of the date proof of loss is required. The case made it up to the U.S. Supreme Court, which held The Plan’s limitation provision is enforceable.  Heimeshoff v. Hartford Life & Accident Ins. Co., ____ U.S. _____, No. 12- 729 (Dec. 16, 2013).  
The Court ruled that unless the contractual limitation period is unreasonably short or there is a “controlling statute to the contrary”, the limitation will be given effect.  In this case, the Court held the 3 year contractual statute of limitation was reasonable. The Court did not preclude the application of equitable tolling, waiver or estoppel.
What remains to be seen is whether LTD insurers will seek to impose a contractual limitation in a scenario where the Plaintiff is approved for two years, and subsequently denied, but unable to file suit within the applicable period of time.  It is difficult to imagine a Court enforcing a contractual limitation in a situation where the claimant is initially approved for a period of time. Nevertheless, the Heimeshoff case opens the door to such arguments.