Routinely, disability insurance companies in their bid to reduce the amount of disability benefits to be awarded to disability benefits claimants will require the claimants to first apply for Social Security Disability benefits. If the claimant happened to be successful in his or her claim for Social Security Disability benefits, the insurance companies will then offset the amount of disability benefits awarded by the amount of disability benefits that the claimant received from the Social Security Administration (SSA). However, when it comes to losing out due to an SSA determination of the definition of “disability”, insurance companies will try their best to disregard the SSA determination as it is unfavorable for them financially to follow the SSA determination.
The case of Ricky A. Dickens v. AETNA Life Insurance Company is a very good example of how the AETNA Life Insurance Company (AETNA Life) in terminating the long term benefits of Mr. Dickens, tries to brush aside the fact that the SSA still considered the plaintiff a disabled person during the period in question.
The Facts of the Case
The plaintiff R.A Dickens was a senior territory business manager for Bristol-Myers Squibb Company (BMS). The scope of the plaintiff’s occupation involved traveling and marketing drugs to doctors and the medical establishments. When hired by BMS in 2002, the plaintiff participated in a long term disability (LTD) plan offered by BMS and administered by AETNA Life. In early 2004, the plaintiff suffered clinical depression, anxiety, insomnia and suicidal ideations. Due to his disabling medical conditions, the plaintiff applied and received LTD benefits under the plan in 2004. The plaintiff was considered disabled under the LTD plan’s definition and received benefits until August 2008. In August 2008, AETNA Life terminated the LTD benefits of the plaintiff on the ground that the medical evidence demonstrated that the plaintiff was “…no longer suffering from a debilitating injury or illness.”
The plaintiff appealed several times but to no avail. One of the arguments put forward by the plaintiff was that the SSA continued to regard the plaintiff as being disabled under the relevant laws. The plaintiff argued that the definition of disability used by the SSA for determining whether a person is considered disabled or not is similar to the corresponding definition used under the LTD plan. As such, the plaintiff contested that AETNA Life had to give significant weight to the SSA’s disability determination while making its own determination of what is defined as disabled under the LTD plan.
AETNA Life’s reply to the plaintiff upholding the denial of LTD benefits stated that:
We also reviewed documentation from the Social Security Administration dated 9/20/04, which advised of your monthly disability benefit, and correspondence dated 6/11/07, which indicated continuation of those benefits. However, in order to be eligible for continued benefits under your LTD plan, we must conclude that you were unable to perform the essential functions of any job for which you are reasonable qualified because of your education, training or experience, effective 9/1/08.
The plaintiff’s disability lawyer filed a lawsuit against Aetna.
The District Court Ruling
Before making its ruling, the district court had to first decide if the SSA definition and LTD definition of “disabled” was similar. It does this by looking at three elements of the definition:
- The Causal component
- The Impairment component and
- The Scope component
It found that the two definitions were similar and in fact that the SSA definition was more resistive as it was more difficult to prove disability under the SSA definition. As such, it ruled that the SSA determination of disability in this case carries substantial weight. Thus, in order for AETNA Life “to observe principled and fair procedures, AETNA had to first consider the SSA’s disability award to the plaintiff before it can decide on its own disability determination.
The court ruled that Aetna’s action of providing “lip service” and mere acknowledgement of the Plaintiff’s SSA award does not constitute giving any weight to the SSA determination of disability at all. AETNA Life’s “cursory treatment of the SSA decision” only indicated it going through the motions rather than actually considering the evidence that it has before it. As such, the court ruled that AETNA Life’s decision to terminate the plaintiff’s disability benefits was an abuse of its discretion and therefore remanded the case back to AETNA Life requiring it to consider the relevant information which it had disregarded in making its disability determination the first place.
The court has given Aetna another chance to approve or deny disability benefits rather than exercise the discretion to award benefits.