Conclusory Medical Opinions Regarding Disability Status Will Not Carry the Day for ERISA Insurers

An individual suffering from a disabling condition undoubtedly has many concerns. In addition to dealing with physical pain and emotional distress, there is always the thought of how to pay for medical bills and sustain a living if the disability prevents a person from continuing work in the occupation he or she had before the injury or sickness causing the disability occurred.

It can be stressful, time consuming and expensive to be awarded long-term benefits (“LTD”) under an employee benefit plan. However, a recent district court case, Carrier v. Aetna Life Insurance Company, 2015 WL 4511620, may help insureds in this regard by making it more difficult for insurance companies who have issued plans governed by ERISA to summarily deny an insured’s claim without proof of specific findings and detail as to how they reached their conclusion to deny benefits.

In this case, the plaintiff, Gloria Carrier, was employed by Bank of America as a Credit Administrator. Her job duties included, in part, clearly communicating risk analysis, identifying problems on credit-related issues, guidelines & policies, performing research on closed loans, and supervising between twenty and 100 people across multiple states.

After being diagnosed with uterine cancer, she had to have her uterus removed and subsequently underwent three cycles of chemotherapy. After her surgery and chemotherapy, her cognitive abilities were severely affected and, according to her treating physician, she suffered from severe depression and suicidal thoughts.

She initially received short-term disability (“STD”) benefits under her employee benefit plan with Aetna Life Insurance Company through Bank of America. After the expiration of her STD benefits, she applied for LTD benefits under the plan. To receive LTD benefits, she was required to demonstrate that she met the definition of “disability” under the policy:

To be eligible for LTD benefits, an employee must meet the definition of “disability” under the policy: From the date that you first became disabled and until monthly benefits are payable for 18 months you meet the test of disability on any day that:

  • You cannot perform the material duties of your own occupation solely because of an illness, injury or disabling pregnancy-related condition; and
  • Your earnings are 80% or less of your adjusted predisability earnings.

Although Carrier was initially awarded LTD benefits, Aetna decided to terminate them a few months later “based on its determination that she no longer met the definition of disability,” despite her treating physician’s opinion that she continued to suffer from major depression and cognitive disorder that prevented her from performing her normal job duties. Aetna’s decision was based on peer evaluations conducted by three Aetna retained doctors of the plaintiff’s treating physician’s records and office notes.

Carrier initially appealed the denial with Aetna, however, the termination of her LTD benefits was upheld by the plan administrator. Pursuant to her rights under the ERISA policy, Carrier filed a civil action in the district court of California. After conducting a de novo review of the case, the court determined that Carrier’s benefits were improperly terminated.

The primary factual issue was whether Carrier “satisfied her burden of establishing that she fit[] the definition of disability under the ‘own occupation’ standard” in the policy, which was defined as “the occupation that [the insured was] routinely performing when [the] period of disability beg[an].” Throughout the duration of her disability, Carrier continued to be treated by the same physician, who continued to communicate to Aetna that she was not fit to return to work because of her psychological and cognitive conditions.

In finding that plaintiff’s LTD benefits were wrongfully terminated and withheld, the court reasoned that the opinions of Aetna’s physicians were “presented in a conclusory fashion, making it unclear how they reached such starkly contrasting results from those of [plaintiff’s treating physician], despite reviewing the same materials.” The court found the opinions of plaintiff’s treating physician that she suffered from severe depression and cognitive disabilities that prevented her from performing her job under the “own occupation” definition of “disability” to be more compelling. Although it indicated that there was no legal deference to the treating physician’s opinion, the court’s ruling demonstrates that insurance companies who rely upon peer-to-peer evaluations in evaluating and potentially denying a LTD claim must ensure that a detailed analysis has been conducted, rather than a simple blanket conclusion made without meeting or treating the insured.

The court awarded Carrier LTD benefits for a portion of the period she was wrongfully denied benefits and remanded the action to the plan administrator to resolve a secondary issue regarding a change in the policy’s language from “own occupation” to “any occupation” that went into effect while the initial dispute was being litigated.

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