McKennon Law Group, Author at McKennon Law Group

In this several-part blog series titled The Basics of an ERISA Life, Health and Disability Insurance Claim, we discuss the basics of an ERISA life, health, accidental death and dismemberment & disability claim, from navigating a claim, to handling a claim denial, through the subsequent appeal and litigation. In Part Fourteen of this series, we discuss motions for attorneys’ fees and costs. Under the Employee Retirement Income Security Act of 1974 (“ERISA”), a prevailing party can file a motion for “reasonable” attorneys’ fees and costs associated with the litigation process. Whereas ERISA discusses awarding fees to either party that achieves “some degree of success on the merits,” Hardt v. Reliance Standard. Life Insurance Co., 560 U.S. 242, 244-45, 251-52 (2010), courts seldom award fees to prevailing insurers, see Operating Eng’rs Pension Trust v. Gilliam, 737 F.2d 1501, 1502 (9th Cir. 1984). As such, this article mostly applies to prevailing beneficiaries.

When awarding attorneys’ fees, a court focuses on two key issues: (1) whether the moving party achieved some degree of success on the merits, and (2) how large of an award of fees is reasonable. Both of these issues are addressed in a manner that is favorable to beneficiaries.

As for the first issue, success on the merits, most beneficiaries will satisfy this requirement if they receive even a portion of their benefits. They need only achieve “some degree of success on the merits.” Hardt, 560 U.S. 244-45, 251-52. This is a very low standard. For example, a beneficiary need not proceed to trial and obtain a court ruling in his or her favor. Whereas that would certainly satisfy the requirement, it is not required. Instead, an insurer may realize that it made a mistake and reinstate the beneficiary’s benefits in the middle of litigation. This will still qualify as sufficient success on the merits for a beneficiary to receive an award of fees. See, e.g., Smith v. Aetna Life Ins. Co., 2020 WL 6055147 (S.D. Cal. Oct. 14, 2020). In fact, here at the McKennon Law Group, we often encounter that very scenario. We sue an insurer and, rather than litigating against us, it agrees to reinstate our client’s benefits. Afterwards, we file a motion with the court seeking attorneys’ fees and costs. The courts have always granted our motions and have in every case awarded us attorneys’ fees. We also often include an amount to cover our attorneys’ fees when negotiating a settlement with an insurance company. The law is clear: When we obtain a portion, or all, of our client’s benefits, regardless of whether the court ruled on our client’s behalf, the insurer must pay our client’s reasonable attorneys’ fees and costs.

The main fight in these cases is whether the amounts of the attorneys’ fees requested are reasonable. To calculate an award of fees, the court first “establishes a lodestar by multiplying the number of hours reasonably expended on the litigation by a reasonable hourly rate.” Welch v. Metro. Life Ins. Co., 480 F.3d 942, 945-46 (9th Cir. 2007). When determining the reasonable hourly rate, “the court may take into account: (1) the novelty and complexity of the issues; (2) the special skill and experience of counsel; (3) the quality of representation; and (4) the results obtained.” See Caplan v. CNA Fin. Grp., 573 F.Supp.2d 1244, 1251 (N.D. Cal. 2008). The court has the discretion to adjust the presumptively reasonable lodestar fee using a multiplier in “rare and exceptional cases.” Welch, 480 F.3d at 946.

When calculating a reasonable fee, courts often look to what other courts have approved. For some attorneys, this can be problematic if they have limited ERISA experience. For firms such as the McKennon Law Group PC, this greatly simplifies matters. Our firm has quite possibly been awarded attorneys’ fees more times than any other firm in the State of California over the last several years. As such, the attorneys here can simply direct the court to a stack of cases that show previously awarded rates. This is usually sufficient for the court to approve our hourly rates. For an attorney without that experience, the court will often see what other courts have approved for rates of other attorneys with similar levels of experience. The same principle applies for time worked on a case. A court will examine the amount of time worked on each aspect of the case and determine if the time was reasonable considering the complexity of the case and what other courts have approved. See generally Smith, 2020 WL 6055147.

Courts rarely use a multiplier on the calculated award. However, in its discretion, the court can raise or lower the award of fees by a flat percentage if it feels that the fee award warrants a further modification. Such changes are usually due to extraordinary circumstances such as excessive or unclear billing. The court may also impose a modification if the attorney achieved an extraordinary result in a particularly complicated case. Ultimately, courts rarely apply a modifier.

Even though this area of the law favors beneficiaries, it contains one very important limitation to awards of fees and costs. A beneficiary cannot obtain fees for work done during the administrative appeals process. See Dishman v. UNUM Life Ins. Co. of Am., 269 F.3d 974, 987‑88 (9th Cir. 2001). For frame of reference, under almost all ERISA plans, a beneficiary must first pursue an administrative appeal if the insurer denies the claim. Only after the insurer denies the appeal does the beneficiary obtain the right to sue. Because ERISA fails to provide fees for the administrative appeals stage, sometimes beneficiaries financially benefit from losing their administrative appeal and then settling the matter after suing the insurer. An award of attorneys’ fees is then available to the beneficiary.

McKennon Law Group PC has significant experience in handling ERISA and non-ERISA insurance cases in which an insurer denied a claim. If your insurer or plan administrator has denied your claim, please contact us for a free consultation so that we may assess your matter.

Learned Hand, the renowned American jurist and judicial philosopher, once said: “Words are chameleons, which reflect the color of their environment.” Nowhere is this truth more apparent than when an insurance plan or policy contains a “discretionary language provision” which gives the insurer nearly absolute power to, among other things, interpret the terms of its own policies or determine an insured’s eligibility for benefits. The presence of these types of provisions in insurance plans/policies not only benefit insurance companies when determining whether to approve or deny benefits as part of its own internal claims process, but also in the event an insured challenges a denial of benefits in court.

There are two judicial standards of review which can be applied to ERISA cases: “de novo” review and “abuse of discretion” review. When a court reviews an ERISA claim “de novo” (from Latin, meaning “from the new”), it is not required to accord any weight to the insurer’s decision or rationale for the denial in the first instance; the court is free to review the administrative record and determine if the claim should have been approved or denied. However, in instances where the plan or policy at issue contains discretionary language provisions, the “abuse of discretion” standard applies. This standard requires the court to accord deference to the insurer’s determination, and the court will only overturn a denial where the insurer “render[s a] decision[ ] without any explanation,[ ] construe[s] provisions of the plan in a way that conflicts with the plain language of the plan, or rel[ies] on clearly erroneous findings of fact.” Day v. AT&T Disability Income Plan, 698 F.3d 1091, 1096 (9th Cir. 2012).

However, recognizing the inherent conflicts of interest that inevitably arise from discretionary language provisions, courts have tempered the deference accorded to insurers under the “abuse of discretion” standard by applying a “level of skepticism” analysis to the insurer’s decision. For example, if the court’s review of the administrative record makes it clear that the insured’s denial was based upon a complete and thorough review of the insured’s medical records, and interprets and applies the provisions of the plan/policy in a reasonable manner, then significant deference is afforded to the insurer’s decision. If, on the other hand, the court finds that the denial resulted from an inconsistent interpretation or application of plan/policy provisions, or from an incomplete or inadequate investigation and review of the claim, then the level of deference will be low.

The United States District Court in Hawaii recently addressed a clear example of the latter situation in a decision from Masuda-Cleveland v. Life Insurance Company of North America, 2020 WL 7048257 (D. Hi. Nov. 30, 2020). In Masuda, Plaintiff’s husband was a participant in his employer’s Group Accident Plan (“the Plan”) who passed away following a single car collision. An autopsy was performed in which it was concluded that the cause of death was “blunt force trauma to the face and neck” and that the manner of death was accidental. The autopsy report also speculated that it was possible that an acute medical event, such as a heart attack or seizure, caused the Plaintiff’s husband to lose consciousness and crash.

According to the terms of the Plan policy:

We agree to pay benefits for loss from bodily injuries:

a) caused by an accident which happens while an insured is covered by this policy; and
b) which, directly and from no other causes, result in a covered loss.

We will not pay benefits if the loss was caused by:

a) sickness, disease, or bodily infirmity; or
b) any of the Exclusions listed in the policy.

Defendant denied Plaintiff’s claim for benefits, taking the position that the “[husband’s] death was not caused by an accident as mandated by the policy, but rather, a medical event which caused a motor vehicle crash.” Plaintiff then appealed the denial, but the denial was upheld on the basis “that there is no coverage for [husband’s] death because an illness, disease or bodily infirmity directly caused the fatal accidental injury.” In other words, although the husband’s cause of death was “blunt force trauma” from the accident, the accident itself was caused by his medical condition (a heart attack or seizure), thereby eliminating coverage.

Plaintiff administratively appealed the denial once more. The denial was upheld yet again, but this time, the rationale was that Plaintiff’s husband “suffered a heart attack which caused both the crash and Masuda’s death, and that the cause of death was not … blunt force trauma to the face and neck.” In other words, this time the basis for the denial was that Plaintiff’s husband had died from a heart attack and thus not from an accident at all, once again eliminating coverage.

After the second denial, Plaintiff filed a complaint under ERISA. The insurer subsequently filed a Motion for Summary Judgment, which was granted by the trial court under the “abuse of discretion” standard. Plaintiff appealed the ruling to the Ninth Circuit Court of Appeals, which reversed, finding that the trial court should have applied a higher level of skepticism (i.e., given less deference) to the insurer’s determination. The case was then remanded back to the trial court to determine, essentially, whether the insurer’s decision could survive the heightened scrutiny. It could not.

Applying a higher level of skepticism, the trial court found that the insurer: 1) failed to construe the provisions of the plan in accordance with their plain language; and 2) relied on clearly erroneous findings of fact.

Specifically, the trial court found that “Defendant’s changing explanation for denial created a moving target for Plaintiff during the appeals process ….” The court went on to note:

Viewed with the appropriately elevated level of skepticism, Defendant’s inconsistent use of “accident,” in the first instance to attribute Masuda’s death to fatal injuries received in an accident, and in the second instance, to deny the existence of an accident and assert a new cause of death suggests that in at least one of those instances, Defendant did not construe the terms “accident” and “cause” in accordance with the plain language of the policy.

The court then went on to examine the insurer’s factual findings. In reviewing the administrative record and additional rebuttal evidence presented by the Plaintiff, the court noted that it was the opinion of four out of five doctors in the case (including the insurer’s own in-house medical director), that the cause of the husband’s death was the blunt force trauma from the accident. The court therefore found untenable the insurer’s position that Plaintiff’s husband’s death was the result of a heart attack rather than injuries sustained in the accident:

Viewed skeptically, Defendant’s factual finding that Masuda’s death was caused by a heart attack and not the injuries to his face and body was clearly erroneous because the Court is left with the firm and definite conviction that Defendant made a mistake in reaching that decision.

The court explained that in McClure v. Life Ins. Co. of N. Am., 84 F.3d 1129 (9th Cir. 1996), determined that where the applicable plan language is less than obvious (“inconspicuous”), the “policy holder reasonably would expect coverage if the accident were the predominant or proximate cause of the disability.” Id. at 1135–36. If, however, the applicable language is conspicuous, recovery could be barred if a preexisting condition substantially contributed to the loss, “even though the claimed injury was the predominant or proximate cause of the disability.” Id. at 1136. (Emphasis added).

The court then cited to Dowdy v. Metro. Life Ins. Co., 890 F.3d 802, 808 (9th Cir. 2018). Under Dowdy, where the applicable language is conspicuous, “[i]n order to be considered a substantial contributing factor for the purpose of a provision restricting coverage to ‘direct and sole causes’ of injury, a pre-existing condition must be more than merely a contributing factor,” (See id. at 809), it must have substantially contributed to the death. The court determined that the medical record did not support LINA’s conclusion that a medical event substantially contributed to Masuda’s death; at most, it was a contributing factor.

Ultimately, having determined that the insurer’s denial could not withstand the appropriate level of skepticism, the trial court did not even bother to remand the case back to the insurer. Instead, in a complete reversal of its prior ruling, entered judgment in favor of the Plaintiff and directed the insurer to pay Plaintiff’s claim.

Conclusion

The Masuda case illustrates the importance of having a skilled ERISA attorney on your case. While many, if not most, attorneys are generally familiar with the concept of “abuse of discretion,” these types of cases demand an attorney who understands the nuances of this standard of review as it applies specifically to ERISA matters, and who can marshal the legal and factual arguments necessary to invoke a court’s heightened level of skepticism.

The experienced attorneys at McKennon Law Group have a long and successful track record of representing ERISA claimants in all aspects of the claim process, from appealing the initial denial of benefits and, if necessary, through each stage of litigation. If you’ve been denied benefits under an employee benefit plan, contact our office today for a free initial consultation.

Even after the current COVID-19 pandemic is declared to be over, many people – possibly up to 10% or even 15% – of COVID-19 patients may continue to display symptoms of the virus beyond the couple weeks for which most people experience them. With 29 million Americans already contracting COVID-19, the number of people in the U.S. who may suffer from the virus for an elongated span of time is substantial. According to a recent Los Angeles Times article by Michael Hiltzik, the emergence of long-haul COVID-19 cases during this pandemic is likely to result in a drastic increase of long-term disability claims and a corresponding delay in the processing of those claims.

The Social Security disability program currently serves about 9.6 million people, including 8.1 million disabled workers and 1.5 million dependents of those workers. Given the volume of long-term COVID-19 cases which have and continue to present themselves in the U.S., if even a fraction of those affected by COVID-19 attempt to secure disability benefits through Social Security, the system may be utterly overwhelmed. Even at its most efficient, anyone who has applied for benefits will likely describe the process as slow, confusing and frustrating, at the very least. For the system to be inundated with possibly several times as many applicants as the system normally sees may be catastrophic for those with no alternative financial support.

Compounding the problem, access to the already-overburdened system is currently even more limited than it was prior to the pandemic due to the closing of Social Security field offices. While a portion of applicants are eligible to apply for benefits online, the vast majority are not so eligible; and even those eligible for online applications often require assistance to even attempt to navigate through the daunting, complex, labyrinth-like application process.

While the thought of facing the Social Security application process may drive away those who have other means of support, for many Americans, the disability benefits provided through Social Security will be vital to their ability to obtain even the most basic of human needs. Thus, the prospect of having an application take several months or longer to even begin to be reviewed will not dissuade those in dire need from submitting applications. When the field offices begin to re-open, the net result may very well be a backup of applications for which the system could not possibly be prepared, given the glacial pace of the machine on even its best day in non-pandemic circumstances.

Those able to have their applications reviewed will still face an uphill battle: the symptoms of long-haul COVID-19, which include chronic fatigue, nonspecific pain, headaches and “brain fog” are difficult to quantify and do not show up in medical tests, resulting in many denials of benefits based on a lack of tangible evidence regardless of the amount of pain or fatigue applicants actually experience.

While the Social Security Administration claims it evaluates applications based on function over diagnosis and that workers unable to work should receive benefits. It has also created a database of common symptoms of long-haul COVID-19, which will provide some guidance for judges ruling on appeals of benefit denials. But getting to a point where a worker’s appeal is reviewed by a judge can already take months or years, even without a massive back-up of applications.

Only time will tell how well the Social Security Administration handles the issues presented by long-haul COVID-19. If the current state of the system is an indicator, we anticipate long-haul COVID-19 workers applying for disability benefits to experience as much fatigue and headache from the application process as they do from the virus itself.

We believe this issue is not confined to the Social Security Administration. Along with Social Security applications will likely come a corresponding increase of claims for short-term disability and long-term disability benefits by workers through their respective insurance providers. Additionally, we believe that with such an increase in applications, both the Social Security Administration and insurance providers will be motivated to find any justification for denying workers benefits due to the impending surge in applications and the inevitable financial impact payment of so many claims could have for them. Accordingly, we recommend that if you have an individual disability policy or a group disability policy obtained through your employer, you should review your policy terms to determine what benefits, if any, may be available in the case you contract COVID-19 and have a resulting disability.

The experienced attorneys at McKennon Law Group PC have a long and successful track record of representing disability claimants in all aspects of the claim process, from appealing the initial denial of benefits and, if necessary, through each stage of litigation. If you have been denied benefits under an employee benefit plan, contact our office today for a free initial consultation.

If you need long-term disability benefits after a disabling sickness or disabling injury, you should be advised and represented by a California disability insurance claims attorney with the McKennon Law Group. For more than seventy years, the McKennon Law Group has advised and represented California families and consumers whose claims for insurance benefits have been wrongly and unfairly denied.

The California State Disability Insurance program provides short-term disability insurance benefits to eligible workers who are unable to work because of a non-work-related illness or injury, pregnancy, or childbirth. While that program pays most workers 60 percent of their wages for up to a year, this state does not have a public, long-term disability insurance program.

Do You Have Private Long-Term Disability Coverage?

Many private insurance companies offer long-term disability insurance coverage, but even if you are a paid-up policyholder, an insurance company may reject your claim for long-term disability benefits or expect you to provide extensive and detailed evidence of your disability.

Individual disability insurance policies are usually governed by state laws, while most of the group insurance policies that are provided by employers in California are governed by the federal Employee Retirement Income Security Act of 1974 (ERISA).

When Should You Contact an Attorney?

If you believe that an insurance company or employer has wrongly denied your disability benefits claim under ERISA, you should consult an attorney – at once – at the McKennon Law Group. We’ve handled thousands of disability insurance claims, and we know how to resolve disability claim disputes that involve both individual policies and ERISA-governed group policies.

If your claim for long-term disability benefits under an ERISA group plan is denied, you must pursue at least one appeal directly with the insurance company before you will be allowed to file a lawsuit. Let a California disability insurance attorney at the McKennon Law Group handle that appeal on your behalf.

What Compensation Can a Lawyer Help You Recover?

If your claim for disability benefits through an individual insurance policy is denied, you may be able to bring a bad faith lawsuit against the insurance company, and you may also be entitled to substantial further compensation for the suffering caused by the wrongful denial of your claim.

However, if your claim for long-term disability benefits is based on an ERISA-governed group plan, there will be some restrictions on the compensation you may recover. With either type of insurance policy, an attorney for insurance claims at the McKennon Law Group can offer you reliable, comprehensive legal advice regarding the best way to move forward.

There is No Charge for Your First Legal Consultation

If your claim for long-term disability benefits has been rejected – or if your claim has been delayed for no apparent or discernible reason – call the McKennon Law Group today to learn more or to schedule a no-cost, no-obligation initial legal consultation. Take advantage of the opportunity to learn where you stand legally and to receive sound, personalized legal advice.

Let us put more than seventy years of legal experience to work on your behalf. You can contact the McKennon Law Group by calling (800) 682-4137 or by completing the contact form on this website. Our law offices are located in San Francisco, San Diego, Los Angeles, and Newport Beach.

According to the California Department of Insurance, most Californians cannot afford nursing home care – at an average cost of $6,000 per month – and are worried about the cost of growing older. Purchasing a long-term care insurance policy is one solution to this dilemma facing an aging California population. Long-term care insurance can be invaluable to elderly persons who can no longer care for themselves. These insurance policies typically cover nursing home costs and in-home care at your own residence if you are unable to care for yourself. But even if you are one of the lucky few that has LTC insurance, unfortunately, we regularly see long-term care insurers that do not honor their policy obligations.

The California legislature recently created a Long-Term Care Insurance Task Force within the Department of Insurance. California Insurance Commissioner Ricardo Lara just appointed six members to the Task Force with preeminent credentials. The Task Force will explore how to design a statewide affordable long-term care insurance program including whether an increase in payroll taxes might allow for the program to be publicly subsidized. An article on the Task Force is copied below. You can learn more about the Task Force at http://www.insurance.ca.gov/0500-about-us/03-appointments/ltcitf.cfm#about.

Hopefully, the Task Force will result in long-term care insurers honoring their contract obligations more frequently. That is doubtful in our opinion. That is not the goal of the Task Force. Moreover, insurers are in the business of making money. To do that successfully, an insurer must take your premiums and pay out as little in claims as possible. In our experience, Department of Insurance actions usually do not change an insurer’s conduct in a particular claim.

So, what should you do if your long-term care insurer wrongfully denies your claim? Relying on this new Task Force will not change your claim denial, and the Task Force is not even scheduled to create a potentially publicly subsidized long-term care insurance program for several years. You should hire an experienced California insurance bad faith or ERISA lawyer to represent you. If your claim for long-term care, long-term disability, life, accidental death, retirement or health benefits has been denied, you can call (949) 387-9595 for a free consultation with the attorneys of the McKennon Law Group PC, several of whom previously represented insurance companies and are exceptionally experienced in handling both ERISA insurance claims and non-ERISA California insurance bad faith claims.

Commissioner Lara Appoints Members to the California Long Term Care Insurance Task Force

SACRAMENTO, Calif. — Insurance Commissioner Ricardo Lara today announced his six appointments to the new Long Term Care Insurance Task Force, established within the California Department of Insurance by legislation that he strongly supported to help address the long-term care services and insurance needs of older Californians.

“Our new Long Term Care Insurance Task Force will explore greater options for Californians to help them age with dignity and security,” said Commissioner Lara. “With their deep experience in insurance, culturally competent care and services, and the health needs of older Californians, these Task Force members are ready for the challenge of envisioning a statewide insurance program that is sustainable and meets the needs of our growing diverse population. The health disparities exposed by the current pandemic on our aging population and the services and supports they will need in coming years make this Task Force even more critical today.”

Created by the legislative passage and Governor Gavin Newsom’s signing of AB 567 (Calderon, Chapter 746, Statutes of 2019), the Task Force will, under Commissioner Lara’s leadership, explore how a statewide long-term care insurance program could be designed and implemented to expand the options for people who are interested in insuring themselves should they encounter functional or cognitive disability that requires long-term care, services, and supports. The 15-member Task Force includes the Insurance Commissioner, who will serve as its Chair, as well as the Director of the California Department of Health Care Services (DHCS) or his designee, the Director of the California Department of Aging or her designee, six individuals appointed by the Commissioner, four individuals appointed by the Governor, one appointment made by the Speaker of the Assembly, and one appointment made by the Senate Committee on Rules.

“The lack of affordable long-term care is a serious threat to the well-being of many Californians, and yet another symptom of the systemic inequities in our health and social support systems,” said DHCS Director Will Lightbourne. “I’m pleased to join this task force and work on solutions that will increase access to long-term care and help provide healthy and dignified lives for our aging populations.”

“Affording the care we need as we age, so we can live where we choose in the community, is a top priority for the thousands of Californians we heard from in developing the Governor’s Master Plan for Aging, released in January,” said California Department of Aging Director Kim McCoy Wade. “Innovative public private leadership and partnership, such as this new Task Force provides, are essential to developing effective and equitable solutions. I’m eager to work with Commissioner Lara and members of the Task Force to move this important work forward.”

Over the next two years, the Task Force will meet to discuss establishing a statewide long-term care insurance program and prepare a feasibility report for the Commissioner, the Governor, and the Legislature by January 1, 2023. The recommendations made by the Task Force in the feasibility report will then be analyzed in an actuarial report to ensure an adequate benefit within a solvent program which, if approved by the Task Force, will be submitted to the Legislature by January 1, 2024.

The first meeting of the inaugural Task Force is expected in early spring 2021. More details are available at http://www.insurance.ca.gov/0500-about-us/03-appointments/ltcitf.cfm.

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Media Notes:

Newly appointed members include:

Dr. Lucy Andrews, is Director of Nursing and CEO for At Your Service Nursing and Home Care. Dr. Andrews presently serves as Board Chair for the California Association for Health Services at Home (CAHSAH) and is the former Vice Chair of the National Association for Home Care and Hospice in Washington, DC. She is also a recipient of the Lois Lillick Award, which honors advocacy and expertise in the home care industry. Dr. Andrews joins the Task Force as a representative of hospice and palliative care providers.

Grace Cheng Braun, MSPH is President and CEO of WISE & Healthy Aging, which administers the City & County of Los Angeles’ Long-Term Care Ombudsman Program (the largest Ombudsman program in the state, and second in the nation) and Elder Abuse Prevention Services. The community-based, nonprofit social services organization also operates two adult day care centers and other care coordination and enrichment programming for older adults and caregivers of the elderly in Los Angeles. She is also a member of the Steering Committee of both the Los Angeles Alliance for Community Health and Aging (LAACHA) and the Westside Older Adult Services Network, which promotes health and service equity in the Los Angeles community. Cheng Braun joins the Task Force as a representative of adult day services providers.

Michael Mejia is Senior Vice President, Operations for Atria Senior Living where he leads Atria’s operations in the Western U.S. and currently oversees operations at 43 Atria communities in California, including 33 with memory care neighborhoods. He joined Atria in 1998 and since then has overseen operations in Texas and Kansas as Regional Vice President and served as Senior Vice President previously in the Central, Southeast, and Southwest divisions. He is also a member of the California Assisted Living Association (CALA) Board of Directors. Mejia joins the Task Force as a representative of residential care facilities for the elderly.

Doug Moore is the Executive Director of the United Domestic Workers of America (UDW/AFSCME Local 3930) which represents more than 140,000 In-Home Supportive Services (IHSS) providers and family child care providers across California. Moore also serves as International Vice President of AFSCME. He was appointed by the State Assembly to the California Task Force on Family Caregiving in 2017. In 2019, he was appointed to the Governor’s Task Force on Alzheimer’s Prevention and Preparedness. Moore joins the Task Force as a representative of independent providers of in-home personal care services.

Dr. Karl Steinberg, M.D., C.M.D., has been a skilled nursing facility and hospice medical director in San Diego County for over 25 years and cares for patients in nursing homes, assisted living facilities, and small board-and-care facilities. He is President-Elect of AMDA – The Society for Post-Acute and Long-Term Care Medicine, a national organization representing physicians and medical directors working in various post-acute and long-term care settings, and is a delegate to the American Medical Association and the California Medical Association. Dr. Steinberg joins the Task Force as a representative of long-term care health professionals.

Tiffany Whiten is Senior Government Advocate at SEIU California State Council where she oversees and coordinates state legislative and administrative policy development on many SEIU-California policy priorities, including assisted living, IHSS, nursing homes, adult day care, developmentally disabled, and other long-term care sectors as well as racial and social justice issues. She not only represents and advocates on behalf of long-term care providers, workers, and consumers, but is also a family caregiver to her mother with Alzheimer’s. Whiten’s previous roles include working as an Associate with Niemela Pappas and Associates, a Consultant for Senator Mark DeSaulnier, a Legislative Aide to Senate Majority Leader Ellen Corbett, and a Legislative Aide to Senate President pro Tempore Don Perata. Whiten joins the Task Force as a representative of family caregivers.

Insurance companies often base denials of disability claims on the mere review of the available documentation in the existing claims files. It is cheaper for them to do so and by using their own paper reviewer, they reduce the risk of an unfavorable report after completion of a significantly more expensive independent medical examination. By carefully selecting the paper reviewers, the insurance companies can obtain some “evidence” of a basis for denial of claim benefits. But how much value do such reports have, particularly if they conveniently fail to address substantial evidence of disability in the reports of the claimant’s treating physicians in the claims file?

In a recent disability benefits decision involving Unum Life Insurance Company (“Unum”), Rios v. Unum Life Ins. Co., 2020 WL 7311343 (C.D. Cal. Dec. 10, 2020), the court reviewed the denial of a disability claim under a de novo standard of review and determined that the claimant was entitled to disability benefits.

Claimant Yolanda Rios worked as a User Support Specialist for large national law firm, Arnold & Porter Kaye Scholer, L.L.P., until she made a claim for disability benefits with Unum. Claimant’s specific job at Arnold & Porter required constant sitting as well as intense concentration and logical thinking. Her Regular or Usual Occupation in the national economy required “constantly sitting” for more than 5.5 hours in an 8-hour day, and it required “focus and concentration.” Rio’s primary disabling condition was “back and leg pain (sciatica) related to multi-level degenerative lumbar disc disease, stenosis, radiculopathy, and ‘severe disc narrowing at L4/5.’” Unum initially approved and paid long-term disability benefits based only on her anxiety and depression and not on any physical impairment, but Unum agreed to further evaluate her physical complaints.

Unum based its denial on a “paper review” of the records which arbitrarily failed to adequately address the claimant’s own testimony regarding pain. The medical reviewer ignored substantial evidence of “excess pain” throughout the claimant’s medical records. Unum had the opportunity to medically examine the claimant and chose not to do so while knowing of the evidence of Rio’s significant pain in the medical records. The court’s disability finding was further supported by the Social Security Administration’s determination that the claimant was “less than sedentary” and, therefore, disabled from “any gainful occupation.” Although the favorable SSA ruling was not dispositive, the court, following applicable Ninth Circuit precedent, found it to be relevant.

The Rios court criticized Unum’s paper review because it conflicted with substantially all the medical evidence, and it faulted Unum for failing to conduct a medical examination of the claimant. The court held that Rios was disabled under both the “own” and “any” occupation standards and faulted Unum’s reviewer for numerous misstatements and inaccuracies. It noted that at least five treating doctors or health care providers had documented that she was taking drugs that affected her concentration, that she had memory problems and that her muscle relaxant did not allow her to work. Because her current job required the ability to focus on a task for some length of time and the ability to use reasoning consistently in her regular and usual occupation as required in the national economy, Rios was disabled under both standards.

The court found that Unum arbitrarily discredited Rios’ testimony of her pain, and her testimony was supported extensively in the medical records. And, Unum did not bother to conduct its own medical examination of the claimant. Unum’s failure to do so “‘raise[s] questions about the thoroughness and accuracy’ of its benefits determination.” Rios, 2020 WL 7311343, at *3, citing Montour v. Hartford Life & Acc. Ins. Co., 588 F.3d 623, 630, 634 (9th Cir. 2009). The court was skeptical of the opinions of Unum’s non-examining experts because it found that the opinions of the examining physicians were “entirely one sided in favor of [Plaintiff’s] claim.” Rios, 2020 WL 7311343, at *3, citing Salomaa v. Honda Long Term Disability Plan, 642 F.3d 666, 676-679 (9th Cir. 2011).

Rios is instructive in demonstrating the relative lack of evidentiary value a court should attribute to such one-sided paper reviews. The ruling recognizes that the insurer had the opportunity to obtain better evidence of the actual current condition of the claimant through a medical examination, and that the insurer should not benefit from its failure to engage in such examination. And, of course, one-sided paper reviews that completely fail to consider abundant evidence of disability are entitled to little, if any, consideration. In addition, Rios underscores the need for claimants to supplement the evidence in the claim file with additional favorable evidence. In particular, Ms. Rios benefited from the supplementation of the record to include the approval of her SSA benefits, which approval occurred after her claim was submitted and was, therefore, not available for consideration at the time of the insurance company’s denial of benefits.

The involvement of skilled ERISA attorneys can make an important difference in the likelihood of a favorable outcome in these matters. McKennon Law Group PC focuses its practice on assuring the most favorable presentation of such reasonably available evidence to the court and the opposing party. Its expertise in handling these matters can be seen in the numerous rulings in favor of claimants. If you believe that an insurance company or benefits administrator has unfairly handled your claim for disability benefits, we urge you to contact us for a free, no-obligation, case evaluation. Let us see what we may be able to do to help you get the benefits you deserve.