LINA (CIGNA) denies long-term disability benefits to yellowbook Account Executive

The case we will look at here demonstrates once again how reviewing a disability denial under the abuse of discretion standard can favor an insurance company’s disability denial. All the insurance company must prove is that the process used to come to a claims decision was logical and reasonable. As you read the following case, it might seem that Jerry Darvell and his disability insurance attorney had good reason to believe he had been denied benefits wrongfully. You will discover why two federal courts decided otherwise.

Background Behind Long-Term Disability Claim.

Jerry B. Darvell began working for Yellow Book USA, Inc. in May of 2003 as an account representative. This job involves making in-person calls to businesses within the Duluth, MN area. In order to sell the new advertising, Darvell carried a book with advertising and account information that weighed about 35 pounds. He already had a history of shoulder, arm and hand pain that carried over from a 1980 car accident.

In October 2004, his symptoms were severe enough that he went to see three physicians: Dr. Douglas Johnson, a family practitioner; Dr. Raymound Hausch, a rheumatologist; and Dr. Thomas Kaiser, an orthopedic surgeon. All three doctors confirmed his diagnosis. He suffered from reflex sympathetic dystrophy (a pain syndrome), osteoarthritis in both shoulders, and clinical depression.

In response to claims that he was having trouble with pushing, pulling, and lifting, and that he was having trouble lifting his right arm above shoulder level and experiencing grinding and cracking when he moved his shoulders, he was scheduled for x-rays. These revealed that he had progressive osteoarthritis in both shoulders. Damage was significantly worse in the right shoulder than it was in the left, and the x-ray showed osteophyte formation in the right shoulder socket.

Both Drs. Hausch and Kaiser placed Darvell on restriction to sedentary work where he would not be required to lift more than 10 pounds and would only be required to walk and stand occasionally. As far as Dr. Hausch was concerned, there was no way that Darvell would be able to continue any work or sustained gainful employment when the amount of arthritis in his shoulder and his reflex sympathetic dystrophy (RSD) were taken into consideration.

Shortly after this diagnosis was given, Darvell went to see Dr. Johnson, who prescribed an antidepressant. Dr. Johnson noted that depression was “becoming a greater and greater part of his disability.”

Darvell’s doctors continue to restrict him to sedentary work for the next four months. On February 9, 2005, Dr. Johnson noted that the antidepressants had improved the symptoms of Darvell’s depression sufficiently to not require treatment by a psychiatrist, but that this still remained a disabling condition. He also noted that the reflex sympathetic dystrophy and osteoarthritis were of themselves separate disabling conditions.

In a follow-up visit on March 4, Dr. Johnson observed that Darvell’s right shoulder demonstrated a more limited range of motion than before, and that he was experiencing increased pain with any type of movement. Dr. Johnson ordered Darvell to stop working entirely. He wrote a second letter on March 30, that essentially duplicated his conclusions from his February 9 letter– Darvell was unable to work as a result of each of these three conditions, and he doubted that Darvell would be able to return to work as an account executive.

Three Doctors Agree on Disability Status.

Dr. Johnson was not alone. Darvell’s other two doctors agreed that he was disabled and should not be working. Darvell stopped working on March 3, 2005 as recommended by his physicians. He applied for short-term disability benefits under his policy with Life Insurance Company of North America (LINA) , and his claim was approved.

Meanwhile, Darvell continued to see the three doctors who were treating him. His symptoms were more severe at sometimes than others, requiring his doctors to adjust his pain medications. In May 2005, Dr. Kaiser noted that Darvell was unable to use his arms at all, but that the limitation appeared more connected to his RSD than to actual joint damage. His actual range of motion was excellent in both shoulders.

Dr. Kaiser noted after a June visit that Darvell’s neck x-rays showed signs of radiculopathy with significant degenerative changes in one area of his vertebrae. On the other hand, Dr. Hausch felt the x-ray appeared normal.

Darvell went to see Dr. Edward Martinson, physical medicine and rehabilitation specialist in July. His notes recorded that there were no significant radicular type features to his pain. After a later visit in October, Martinson saw no clinical evidence to suggest surgical myelopathy/radiculopathy.

Physical Ability Assessment Used To Prove Lack of Disability.

That same month, on October 21, Dr. Johnson filled out a physical ability assessment form at the request of LINA. He indicated that during an eight hour workday, Darvell could be expected to lift 10 pounds continuously and frequently lift, carry, push or pull up to 20 pounds. He said that Darvell could occasionally lift and carry over 100 pounds. During this eight hour day, Darvell would be able to frequently sit, balance, stoop, kneel, crouch and crawl. He would also be able to work around machinery. He would be able to stand, reach, perform fine manipulations (such as typing) and perform simple and firm grasping tasks. He also stated that Darvell could occasionally withstand temperature extremes and work overtime occasionally.

It should be clarified that the form defined continuously as more than 5-1/2 hours each day. Frequently, meant that a task could be performed from anywhere between 2-1/2 to 5-1/2 hours. If the task was performed for less than 2 1/2 hours, this was considered occasionally.

LINA Gives Reasons for Long-term Disability Denial

Darvell’s short-term disability benefits expired in September 2005. He applied for long-term disability benefits. His application was denied on October 19, 2005. LINA gave the following reasons:

1. His symptoms were the same as he had been experiencing for years.
2. The documentation failed to support the significant physical limitations he claimed to have, including the loss of range of motion or strength in his shoulders.
3. The medical information failed to support his inability to perform the material duties of his regular occupation as defined by the Department of Labor’s Dictionary of Occupational Titles (DOT).

The denial letter included DOT’s description of the work demands connected with being an account executive. “This occupation requires light physical demands, which includes lifting, carrying, pushing, pulling 20 pounds occasionally, frequently up to 10 pounds. It includes occasional reaching, handling and fingering. It can include walking and/or standing frequently even though weight is negligible. It can include pushing and/or pulling of arm and/or leg controls.”

Darvell submitted additional records, including Dr. Johnson’s physical ability assessment of October 2005 in his appeal of the long-term disability benefits denial. LINA upheld its denial decision. Darvell’s long-term disability insurance attorney filed a suit in the District Court for the District of Minnesota.

Disability Insurance Attorney Argues Case before District Court, then Court of Appeals

Because LINA could demonstrate that the disability insurance company had followed a logical, principled course of action in determining whether or Darvell qualified for disability insurance or not, the District Court upheld LINA’s denial decision. Darvell and his disability attorney appealed.

In his appeal, Darvell’s disability attorney argued that LINA had abused its discretion when it rejected the opinions of three doctors who all agreed that he was disabled. LINA’s counter argument pointed to the fact that only one piece of evidence in the record actually addressed his ability to perform the duties of his job, the 2005 physical ability assessment completed by Dr. Johnson. LINA claimed that this assessment when compared with the DOT job description failed to prove his inability to perform the work of an account executive.

The disability attorney also argued that LINA’s use of the DOT job description instead of Darvell’s actual job description also abused the discretion of the disability insurance provider.

Court Applies Deferential Abuse of Discretion Standard

These were the matters before the Court of Appeals. The judges went through the steps established by case law to finalize upon the standard of review that applied to this case. Their review confirmed that the District Court had used the correct standard. This meant that the court would have to defer to LINA’s interpretation of the plan as long as it was reasonable. They applied what is known as the five-factor test:

1. Was LINA’s language in the denial contrary to the clear language included in the plan. The plan clearly stated that Darvell would not be entitled to long-term disability unless he was unable to perform all the material duties of his regular occupation. The question to be considered was whether DOT’s job description or his employer’s job description was the correct one for determining his eligibility. Case law is split on this issue. The judges chose to defer to LINA’s interpretation of Darvell’s regular occupation, finding it reasonable to use the DOT description, especially when using Yellow Book’s job description failed to help Darvell when compared to Dr. Johnson’s physical ability assessment.
2. Did LINA’s interpretation conflict with the substantive or procedural requirement of ERISA? The judges said no. Even Darvell’s disability attorney felt this and the following three questions didn’t apply to Darvell’s case.
3. Did LINA’s interpretetation of the policy render any language in the plan meaningless or internally inconsistent? The judges saw no evidence of this, and neither had Darvell’s disability insurance attorney.
4. Was LINA’s interpretation consistent with the goals of the plan? No inconsistencies were presented by Darvell’s attorney.
5. Had LINA followed the interpretation consistently? It appeared so.

Under the abuse of discretion standard, LINA had successfully demonstrated that the disability insurance company had reached reasonable conclusions. Also, it had interpreted the policy language in a way that was also reasonable. The Court of Appeals affirmed the District Court’s ruling.