Are The Medical Opinions From Doctors Hired By Hartford Insurance Company “Bought And Paid For”?
In Mary Carten vs. Hartford Life and Accident Insurance Company, Group Long Term Disability Plan for Employees Of FMR Corporation, the plaintiff brought the civil lawsuit in a California Federal Court under the Employment Retirement Income Security Act (ERISA) to challenge a denial of disability benefits made by the Hartford Life and Accident Insurance Company (Harford). The plaintiff requested an opportunity to conduct discovery into Hartford’s claims handling practices in order to determine if Hartford’s wrongful denial her long term disability benefits was done with a conflict of interest. It is ironic that Harford denies disability benefits and then tries to do whatever they can to hide the existence of their financial relationship with the doctors they hire. Hartford is suppose to be the fiduciary of Ms. Carten. Hartford’s actions clearly suggest that they are not acting in the best interest of Ms. Carten.
The Facts of the Disability Case Against Hartford
The plaintiff Mary Carten was formerly employed at FMR Corporation as a Vice President/Account Executive. While employed with FMR Corporation, the plaintiff participated in FMR’s Group Long Term Disability Plan for Employees, which was insured and administered by Hartford.
In March 2005, the plaintiff stopped working and applied for short term disability benefits which was approved and lasted for six months. Upon the expiry of her short term disability benefits in September 2005, the plaintiff made an application for long term disability benefits under the above mentioned plan. She received payment for long term disability benefits for approximately 4 years, which were then denied in September 2009.
Termination Of Disability Benefits by Hartford After Paying for 4 Years
In September 2009, the plaintiff’s long term disability benefits were terminated by Hartford. It was stated that the termination was based on a review of the plaintiff’s claim file which indicated that she did not meet the newly triggered definition of disabled. The plaintiff was only entitled to further disability benefits only if she was unable to perform “one or more of the Essential Duties of Any Occupation”
In March 2010, the plaintiff appealed Hartford’s termination decision which Hartford affirmed in June 2010. Hartford’s decision to affirm the termination was based on a second review of the plaintiff’s claim file. Both of the reviews were conducted by a different reviewing physician employed by different consulting companies. Hartford never examined the Plaintiff and relied exclusively on review of medical records.
In August, 2010 the plaintiff filed the legal action seeking a further review of Hartford’s termination decisions. The plaintiff alleged then that Hartford had wrongfully denied the plaintiff’s long term disability benefits under the ERISA plan. The plaintiff also alleged that Hartford had breached its fiduciary duties to plan participants and beneficiaries with respect to its management of the plan.
The Court’s Analysis of the facts of the Case
The arguments presented in the action clustered on two main questions:
- The sufficiency of plaintiff’s proof of her disability.
- The unfairness of Hartford’s claims administration.
To review the matter before it, the Court had to consider several issues:
- The applicable Standard of Review applicable, a de novo standard or an abuse of discretion standard.
- The language contained in the plan unambiguously conferred discretion on Hartford to determine eligibility for benefits and to interpret the plan. The relevant provision of the plan stated:
“We have full discretion and authority determine eligibility for benefits and to construe and interpret all terms and provisions of the Group Insurance Policy.”
- The discretionary authority accorded to Hartford triggered “”¦a deferential standard of review” and accordingly the abuse of discretion standard apply in this case.
The Abuse Of Discretion
To determine if there was an abuse of discretion on Hartford’s part, the court stated that it had to also consider the fact that Hartford acted both as the claims administrator and as the payer as this created a structural conflict of interest, which must be factored into the abuse of discretion analysis.
Hartford Insurance Company’s Structural Conflict Of Interest
Because Hartford has a structural conflict of interest, the plaintiff argued that Hartford’s decisions should be reviewed with heightened skepticism and provided a variety of evidence outside the administrative record to support her arguments that Hartford’s structural conflict of interest was exacerbated by bias.
The plaintiff argued that the file reviewing physicians whose reports were the basis for Hartford’s decisions to terminate plaintiff’s benefits and affirm the termination-were biased by improper financial incentives and pressures. Although, Hartford objected to this evidence being presented, the Court, without ruling on the ultimate admissibility of any materials at trial, found that the plaintiff had produced evidence showing that discovery could well reveal that the file reviewer reports on which Hartford based its actions were “bought and paid for.”
The showing of improper financial influence indicated that Hartford’s structural conflict of interest deserved a closer scrutiny in reviewing the termination of the plaintiff’s long term disability benefits. As such the Court ruled that some discovery is warranted as to allow the plaintiff to try to demonstrate with admissible evidence how conflicts of interest may have infected Hartford’s denial of her claim and subsequent affirmation of the denial.
This ruling is a temporary victory for the claimant, as conflict of interest is one of many factors factor that the court will consider when reviewing a disability denial. It will be interesting to see te results obtained from the discovery into Hartford’s relationship with the physicians they often hire to review disability insurance claims.