Federal Judge orders Union Security (Assurant) to re-evaluate disability denial due to failure to consider risk of substance abuse relapse as disabling condition

In any claim for any disability benefits, the deciding factor which disability insurance companies will decide on will be whether you are what they define as being “disabled” or not. Most insurance companies however, will try to define the scope of what constitutes “disabled” as narrowly as possible to their advantage. The situation is especially compounded when a claimant is disabled due to substance abuse. Substance abuse cases involved both physical disabilities and mental disabilities. However, insurance companies will try to distinguish between a physical disability and a mental disability as they tend to regard risk of relapse into substance abuse more as a matter of choice to overcome temptation rather than a physical disability.

In Dr. Julie Colby v. Union Security Insurance Company and Management company (Assurant Benefits) (USIC), the plaintiff, Dr Colby through her disability attorney, filed a lawsuit against USIC to claim for long term disability (LTD) benefits under Merrimack Anesthesia Associates Long Term Disability Plan. The plaintiff claimed that USIC’s decision to deny her claim for LTD benefits were arbitrary and capricious and it was acting in contravention of the Employment Retirement Security Act of 1974 (ERISA).

The Facts of this Long Term Disability Case

Dr. Colby was an anesthesiologist who in 2004 became addicted to a powerful opioid called Fentanyl. She had been using this drug as a mean for her to cope with chronic back pain. In the course of her duty, she also administered the same drug to some of her patients. Subsequently, her coworkers discovered her addiction which resulted in her quitting her job and losing her medical license. She then enrolled herself into an in-patient substance abuse recovery program on August 16th 2004 and claimed for LTD benefits under her LTD policy with USIC on September 24th 2004. USIC granted Dr Colby benefits during the duration of her stay at the substance abuse rehabilitation center but terminated them when she was discharged on November 20th 2004.

USIC claimed that the plaintiff, with her discharge from the rehabilitation center, she no longer displayed any symptoms of active substance abuse. Their main justification for terminating her disability benefits was that “the risk of relapse into substance abuse is not the same as a current disability.” In short, USIC disregarded the “potential” risk of relapse into active drug abuse as a disability that will impair Dr. Colby from performing the material duties of her job as an anesthesiologist. Dr. Colby appealed twice to USIC’s decision to terminate her LTD benefits but was unsuccessful and as a result she filed a lawsuit to challenge USIC interpretation of the LTD Plan.

The District Court’s Ruling

The District Court ruled that USIC’s disregard of the potential risk of Dr Colby’s relapse back into active substance abuse in its determination to terminate Dr Colby LTD benefits under the terms of the LTD plan was indeed arbitrary and capricious.

The District Court reasoned that the LTD plan did not distinguish between a physical disability and a mental disability. And based on all the medical conclusions by the medical professionals who examined Dr Colby’s mental health, Dr Colby did suffer from opioid dependence which is a mental disorder that is recognized in the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders (DSM-IV). This was a conclusion (opioid dependence) which even USIC admitted in their letter terminating Dr. Colby’s benefits. In addition, USIC also admitted that if a person who is suffering from a physical sickness and if the person’s return to work would pose a high risk of relapse, that person would be covered under the LTD plan.

The courts around the country are split on whether a risk of relapse is a disabling condition.


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