MetLife ordered to reverse denial of long-term disability insurance benefits
Once again, long-term disability insurance provider Metropolitan Life Insurance Company (MetLife) has been ordered by the court to reverse a long-term disability denial because the Court found the grounds for denying the benefits were arbitrary and capricious. This is a far too common occurrence, and one that disability insurance attorneys see frequently. In MetLife denies long-term disability benefits to a consultant after approving them, we looked at background behind John Lanier’s claim.
Judge Lawson recognized that Lanier had a right under section 502(a)(1)(B) of the Employee Retirement Insurance Security Act (ERISA) to bring his case before the court. The evidence that could be presented by either side had to be limited to the information that was available to MetLife at the time it determined whether or not Lanier was eligible for long-term disability benefits. Lanier’s file, also known as the administrative record, would normally be the only evidence considered by the Court, though exceptions have been made if the evidence offered supports a challenge to the procedures used to reach the administrator’s decision. Lanier’s disability attorney would not need to ask for this concession.
Disability attorney agrees with arbitrary and capricious standard of review.
Judge Lawson began his review under the de novo standard which quickly gave way to the arbitrary and capricious standard of review, because MetLife had the authority to determine who is eligible for benefits and to interpret the meaning of terms within the plan. When Judge Lawson chose this as the standard of review, both Lanier’s disability attorney and MetLife’s attorneys agreed that this was the appropriate standard to apply.
The fact that Lanier’s disability attorney was willing to have his case considered under this least demanding form of judicial review indicates that he had considerable confidence that MetLife would not be able to present a reasoned explanation for their denial of Lanier’s long-term disability benefits. This could have been risky, because MetLife had chosen to rely upon the medical opinion of one doctor over that of another, and this does not necessarily mean that an administrator’s decision was arbitrary and capricious.
But Lanier’s long-term disability attorney recognized that MetLife had “cherry-picked” the evidence it found favorable to denying Lanier’s application for long-term disability. He understood that Judge Lawson would be obligated under ERISA to review the administrative record to evaluate the quality and quantity of the medical evidence and the opinions expressed on both sides of the issue.
MetLife argues disability denial was reasonable.
MetLife argued that it had made its decision upon evidence from medical consultants, who concluded that no objective evidence supported the level of disability Dr. Seidel said existed. Based on the opinions of these medical consultants, MetLife reached a reasonable conclusion – Lanier would be able to work in a sedentary position, and thus he did not fit the description in the plan of someone unable to work in any job for which he was reasonably qualified.
Disability insurance attorney points to evidence that decision was biased.
Lanier’s disability insurance attorney pointed to problems with this argument on several levels. The Court agreed. First, Lanier did not base his claim entirely on his diagnosis of fibromyalgia, though this was a component of his disability. Judge Lawson observed that fibromyalgia is a disease for which no objective tests have been developed. The sleep disorder as well as pain symptoms noted by Lanier’s primary treating physician, Dr. Geoffrey Seidel, were in harmony with the diagnosis of fibromyalgia. But this was of less concern to Judge Lawson, because the Lanier presented multiple ailments, many which were objectively confirmed through MRIs and EMG testing.
Judge Lawson also observed that the plan required Lanier to provide documented proof of his disability, but failed to specify what the documentation needed to include as valid objective evidence. While case law suggests it is entirely reasonable for an insurance company to request objective evidence that confirms a claimant’s functional capacity, standardization of what consists of valid evidence does not exist. It is common to use a formal functional capacity assessment, but a qualified physician can correlate clinical findings from objective medical tests and render an opinion regarding a patient’s ability to perform certain tasks.
Lanier’s disability attorney argued that Dr. Seidel had done this. Judge Lawson agreed.
MetLife hired specialist disregards evidence contrary to his own opinion.
Judge Lawson also found it disturbing that the conclusions drawn by the medical consultants MetLife hired, especially physical medicine specialist Dr. Sandar Pemmaraju, were inconsistent with Lanier’s medical record, even including internal inconsistencies. It was inconsistent to recognize that multiple abnormalities appeared in the MRIs, then to turn around and completely discount Dr. Seidel’s correlation of these abnormalities to his patient’s complaints as being merely subjective. The court also observed that Dr. Pemmaraju based his conclusions upon 2003 MRI results, when the more recent 2005 MRI results demonstrated deterioration of Lanier’s condition according to Dr. Seidel.
Interestingly enough, Dr. Pemmaraju drew the conclusion that Lanier was capable of medium duty work, without addressing the fact that Dr. Seidel claimed that Lanier could not sit for more than 20 to 30 minutes at a time. He totally discounted Dr. Seidel’s interpretation of the 2005 MRIs and EMGs which showed chronic radicular symptoms and a congenital narrowing of the spinal canal in the lumbar region, and reached the conclusion without ever seeing Lanier that he could work an entire eight hour day.
Disability insurance company fails to explore options for confirming its denial of disability benefits.
Judge Lawson recognized that when a file reviewer disagrees with the conclusions of a treating physician a disability insurance company isn’t always an error in relying on that medical review. But in this case, the decision based upon the medical review was critical to providing Lanier with a full and fair review. Dr. Pemmaraju never mentioned the fibromyalgia’s possible contribution to Lanier’s condition. He never spoke with Lanier or his treating physician. He also made his decision without the benefit of a full functional capacity evaluation. This is something he used to impeach Dr. Seidel’s report, yet he could have ordered it to confirm his evaluation of Lanier’s condition.
MetLife discounts Social Security benefits approval.
Judge Lawson then went on to consider the fact that Social Security had found Lanier disabled. While insurance plans can have different criteria for qualifying for long-term disability benefits, and thus a Social Security benefits approval may not have any weight before the Court, approval by Social Security for disability benefits is not meaningless. This is especially true if applying for Social Security is mandated by the plan administrator. Unless MetLife could provide a reasonable explanation for why it would not credit the Social Security approval, Lanier’s approval under Social Security disability could be used to demonstrate that MetLife’s decision had been arbitrary and capricious.
Lanier’s disability attorneys pointed to evidence presented at Lanier’s Social security disability hearing. Judge Lawson recognized that MetLife did not have to accept vocational expert Dr. Elaine Tripi’s testimony regarding Lanier’s vocational capacity during his Social Security disability hearing. Yet, the Court affirmed that MetLife was not free to dismiss this testimony.
Disability attorney’s argument that MetLife ignored treating physician’s opinion heard by Court.
And finally, Judge Lawson agreed with Lanier’s disability attorney that the evidence demonstrated MetLife gave no weight to Dr. Seidel’s opinion. He recognized that MetLife had no obligation to give more weight to Lanier’s treating physician’s opinions. At the same time, the disability insurance company was not free to ignore the opinion of a physician who had treated Lanier and knew his case. The disability insurance company was already operating under a conflict of interest as plan administrator and payer of benefits. It had the right to order a physical exam, and because the decision involved a critical credibility determination, Judge Lawson found that MetLife should have ordered an independent medical exam, rather than depending upon a review based upon an incomplete file.
MetLife justified rejecting Dr. Seidel’s opinions by stating that there was a lack of objective verification. Lanier’s disability insurance attorneys argued that choosing Dr. Pemmaraju’s opinions over Dr. Seidel’s was arbitrary. Judge Lawson agreed.
Court finds reversal of original long-term benefit approval arbitrary and capricious.
Finally, after reviewing the entire record, Judge Lawson concluded that when MetLife determined in June 2006 that Lanier was disabled within the meaning of the plan, and then reversed its decision eight months later, it acted in an arbitrary and capricious manner. The disability insurance company could not produce any evidence of improvement in Lanier’s condition that justified the reversal. This certainly didn’t suggest a careful, reasoned process.
The Court agreed that Dr. Seidel had the right to repudiate his report of August 2006 and clarify errors he felt it contained. Thus any transferable skills analysis or work capacity evaluations based upon this report should not have played a decisive role in determining Lanier’s qualification for long-term disability benefits. The Court found it impossible, even using the most deferential review possible, to not find MetLife’s denial of long-term disability benefits wrong. The court reversed MetLife’s decision and ordered MetLife to pay Lanier disability benefits in harmony with the KPMG Consulting, Inc. long-term disability benefits plan.
John Lanier refused to be a victim of an arbitrary decision by MetLife. With the assistance of his disability attorney, he will now receive the disability insurance benefits that rightfully belonged to him.
About the author: Gregory Michael Dell is an attorney and managing partner of the disability income division of Attorneys Dell & Schaefer. Mr. Dell shares these court cases so you can understand how complex representing disability insurance claimants actually is. Mr. Dell and his team of lawyers have assisted thousands of long-term disability claimants with their claims against every major disability insurance company. For a free consultation, please call 800-828-7583 or use our contact page.