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.'”

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. 

ERISA Time deadlines and Standard of Review

Under the ERISA regulations, a plan must issue a benefits determination no later than 45 days after receiving a claim.  The regulations provide for an extension of that deadline, but what happens if the plan doesn’t comply with the 45 day deadline?  It appears the answer depends upon the jurisdiction.

One consequence of the failure to comply with the 45 day deadline is “exhaustion.”  In other words, a claimant is not permitted to file suit in federal court until such time as administrative remedies have been exhausted.  Thus, if a decision is not made by the plan within 45 days, there is authority for the proposition that such a situation constitutes a constructive denial of the claim.  As a result, the plaintiff can bring a lawsuit in federal court. See 29 CFR 2560.503-1.

Once the Plaintiff brings the claim in federal court, what happens?  Normally, disability determinations under ERISA are reviewed by the court under the arbitrary and capricious standard of review.  Interestingly, there is some authority for the proposition that a plan’s failure to comply with the 45 day benefit determination deadline results in de novo review instead of the deferential arbitrary and capricious standard.   Stefansson v. The Equitable Life Assurance Society of the United States, 2005 U.S.Dist. Lexis 21723 (M.D. Ga. 2005) (“because DMS failed to render a benefits determination in accordance with the regulatory requirements, application of the de novo standard of review is appropriate”).  See also: Gilbertson v. Allied Signal, Inc., 328 F.3d 625 (10th Cir. 2003); Jebian v. Hewlett Packard Co., 349 F.3d 1098 (9th Cir. 2003); Kinstler v. First Reliance Standard Ins. Co., 181 F.3d 243 (2nd Cir. 1999); Buck v. Kraft Food Global, Inc., (M.D.Tenn. 2007); Kosiba, 384 F.3d 58 (3rd Cir. 2004). But see: Southern Farm Bureau Life Ins. Co. v. Moore, 933 F.2d 98 (5th Cir. 1993); Hackney v. The Lincoln National Life Ins. Co., 2012 U.S.Dist. Lexis 694 (W.D.Ky. 2012) (de novo determination appropriate in some situations, but Court remanded to insurer for benefit determination).

If you have a long term disability claim governed by ERISA, and the insurer has not rendered a timely decision, it is important that you contact an attorney to discuss your rights.

Consideration of Social Security determination in LTD claims

Quite often, a claimant who is receiving long term disability benefits will be required by the insurance company to file for Social Security Disability.  In fact, often the Plan will provide a representative to assist the claimant in obtaining Social Security disability benefits. If SSA awards benefits, the LTD carrier then claims an overpayment of benefits.   More often than not, the claimant is found disabled by SSA around two years after he/she became disabled, which is right around the time period when the LTD definition of disability changes.  I have represented a number of individuals who are approved by SSA for disability, and then denied by the LTD carrier a month or two later.  In the 6th Circuit, the LTD carrier is not permitted to ignore the SSA disability finding.  In situations where the LTD carrier has required the claimant to apply for disability, and receives a financial benefit from an award of SSA disability, a reviewing court will generally take those facts in to serious consideration in determinating when the decision to deny LTD benefits was arbitrary and capricious. Calvert v. Firstar Finance, Inc., 409 F.3d 286 (6th Cir. 2005); Glenn v. Metlife, 461 F.3d 660 (6th Cir. 2006).  As a practical and legal matter, if the LTD carrier requiring the claimant to apply for disability, is assisting the claimant in applying for disability, and receives a financial benefit from the claimant obtaining disability through SSA, the carrier should be estopped from arguing that the claimant is not disabled.

For example, in Raybourne v. Cigna Life Ins. Co. of New York, 2012 U.S.App. Lexis 24018 (7th Cir. Nov. 21, 2012), Raybourne applied for long term disability benefits with Cigna.  He also filed for Social Security disability benefits.  Cigna hired a company to assist Raybourne with his Social Security disability claim. Raybourne’s disability claim was approved by the Social Security Administration; however, just a few months prior to the disability award, Cigna hired a physician to review the file.  Said physician opined that Raybourne was not disabled.  The report from Cigna was never provided to the Judge deciding Raybourne’s Social Security disability claim.  Instead, after Raybourne was awarded social security disability benefits, Cigna “recouped from the back benefits the money the insurer had paid to Raybourne during the first twenty-four months of his disability.”  Even more disturbing is the fact that just three weeks before Raybournes social security disability hearing, Cigna denied Raybourne claim for long term disability.  In other words, Cigna hired someone to argue that Raybourne was disabled, despite the fact that Cigna had denied his claim for private disability benefits just three weeks prior to the hearing.  Cigna denied Raybourne’s administrative appeals, and did not even mention the social security disability finding.  The case went to federal court, at which time the federal judge remanded the claim back to Cigna for consideration of the SSA disability determination.  Cigna then supplied a list of “reasons” for not accepting the disability finding of the social security administrative law judge.  The Court noted the “seemingly inconsistent positions taken by the insurer” that were “financially advantageous to the insurer.”  The Court further noted that Cigna did not produce the report from their doctor to the Social Security Administration, and instead, only used his report “when it was financially advantageous to the insurer.”  Ultimately, the Court concluded: “Cigna’s denial of benefits was not supported by substantial medical evidence but instead was the result of a structural conflict of interest.” The Court also affirmed the award of attorney fees to Raybourne’s attorney.

If you would like to discuss your Social Security and/or Long Term Disability claim, please click here to obtain the author’s contact information.

ERISA LTD Discovery

Discovery aimed at demonstrating a conflict of interest may be appropriate in a long term disability case.   Moreover, “discovery regarding the proper standard of review to be applied is also proper.”  Medford v. Metro. Life Ins. Co., 244 F.Supp.2d 1120, 1129 (D.Nev. 2003).

Two Recent 6th Circuit Decisions

Two Sixth Circuit decision released last month upheld the denial of LTD benefits.  In one case, the 6th Circuit held that the decision to terminate LTD benefits was not arbitrary and capricious even though employer failed to properly address SSA finding of disability, but where there were six medical opinions adverse to the claimant, and only one in her favor.  Wooden v. Alcoa, Inc., 2013 U.S.App.Lexis 968 (6th Cir. Jan. 11, 2013).  Likewise, in Combs v. Reliance Std. Life Ins. Co., 2013 U.S.App.Lexis 819 (6th Cir. Jan. 10, 2013), the 6th Circuit upheld an ERISA plan administrator’s decision to deny benefits .  In Combs, a couple of facts are worthy of noting.  First, the claimant apparently refused to submit to an examination requested by the insurance company.  Second, the claimant’s condition seemed to involve primarily “subjective” complaints of limitations without much objective support. And finally, the Court found that it was proper to consider evidence obtained on remand.

Attorney Fees for Long Term Disability ERISA cases

“In an action by [an ERISA] plan participant, the district court, in its discretion, ‘may allow a reasonable attorney’s fee and costs of action to either party.’ ” Moon v. Unum Provident Corp., 461 F.3d 639, 642 (6th Cir. 2006)

“[O]ur circuit recognizes no presumption as to whether  attorney fees will be awarded.” Foltice v. Guardsman Prods., Inc., 98 F.3d 933, 936 (6th Cir. 1996)

The Sixth Circuit applies a five-factor test to determine awarding fees:

(1) the degree of the opposing party’s culpability or bad faith; (2) the opposing party’s ability to satisfy an award of attorney’s fees; (3) the deterrent effect of an award on other persons under similar circumstances; (4) whether the party requesting fees sought to confer a common benefit on all participants and beneficiaries of an ERISA plan or resolve significant legal questions regarding ERISA; and (5) the relative merits of the parties’ positions.

“No single factor is determinative, and thus, the district court must consider each factor before exercising its discretion.” Id. at 642, 643.