Cigna’s Termination of Disability Benefits was Arbitrary and Capricious

The case of Lani Kyle Moar v. Cigna Corporation, et al., demonstrates the lengths insurance companies will go to avoid paying long term disability benefits. This Plaintiff’s perseverance resulted in the Court ordering Cigna to pay past due benefits, but also gave Cigna a new chance to deny benefits in a way that will not be arbitrary and capricious.

It began in 2000 when Plaintiff, a flight attendant with United Airlines, was first awarded long term disability benefits when she developed lupus and congestive heart failure. Initially, she received benefits for 24 months when Cigna found she was disabled from working in her own occupation. Benefits continued even after the definition changed and Cigna agreed she was disabled from working in any occupation for which she was qualified.

In conjunction with Cigna paying her long term disability benefits, another policy issued by a company under the Cigna umbrella, also found she was eligible to maintain her life insurance policy, but not have to pay premiums under a waiver of premium (WOP) benefit for those found to be disabled.

Everything went well until March 2012 when Cigna terminated all benefits under both policies. On administrative appeal, after reviewing all medical records and conducting a three-day surveillance, both long term disability benefits and the WOP benefit were reinstated. This lasted until September 2015 when, once again, Cigna terminated all benefits. Her administrative appeal was denied and she filed this ERISA lawsuit.

The U.S. District Court for the Eastern District of Michigan ruled that the decision to terminate benefits was arbitrary and capricious and ordered the defendants to “pay Plaintiff any past-due benefits and commence paying the quarterly waiver of premium benefit and the monthly LTD benefit.”

Cigna’s Termination of Benefits was Arbitrary and Capricious

The Court did an in depth review of Plaintiff’s medical records and the reports of Cigna’s reviewing doctors and commented that “the case turns almost entirely on which doctors’ opinions should be privileged.” The Court also determined that Cigna’s reviewing physicians overlooked the conclusions that the Plaintiff’s lupus interfered with her ability to work, indicating the “denial was arbitrary.”

The Court acknowledged that “an insurer may change a disability determination based on [medical records], even if the claimant has received benefits for a long time…But, there must be a reason for the change.” In this case, there was “very little” to indicate that anything changed and that Plaintiff was no longer disabled.

The Court concluded that the reviewing doctors considering Plaintiff’s long-term disability benefits and her WOP benefit “relied on a fraction of the relevant medical evidence and failed to acknowledge the fluctuations that Moar’s lupus created. For those reasons, the denial was arbitrary and capricious.”

The Remedy

The Court ordered Cigna to pay Plaintiff past-due benefits. Unfortunately, the Court concluded that its ruling “does not confirm that Moar is or was disabled under the policies. Rather, the Court finds only that the decisions to deny Moar’s benefits were arbitrarily and capriciously made.” It essentially gave Cigna another opportunity to further review whether or not Plaintiff is still entitled to benefits.

This case was not handled by our office, but we feel it can be instructive to those who have received long term disability benefits and suddenly find themselves cut off by their disability insurer. For questions about this case, or any aspect of your disability claim, contact our disability attorneys at Dell & Schaefer for a free consultation.

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Charles A. M.D.

I am very humbled to have the privilege to write this testimonial on behalf of Dell & Schaefer and more specifically, Mr. Cesar Gavidia. Unfortunately, after suffering from Essential Benign tremors for numerous years I lost a career for which I dearly loved. I was a dental implant surgeon whose accomplishments are quite humbling. I devoted my entire career to my patients, employees, colleagues and students. Upon discovery of my disability, I contacted Mr. Cesar Gavidia for professional guidance. Upon meeting Mr. Gavidia, I inquired of his knowledge, years of experience, colleagues and most importantly his “Passion” to represent each and every client.

What I discovered was a very sincere Gentleman with a tremendous depth of knowledge regarding my disability policies and many others aspects of business law. During the last five (5) years of my career I could have increased the benefits of my disability policy. However, I failed to do so. I thought I had all of the answers. I was wrong! I would encourage each and every reader to consult with an expert such as Mr. Cesar Gavidia prior to entering into a “Disability Insurance Contract”. Or at least shortly thereafter. You will be enlightened to learn the details and how they will affect you if you incur a career ending disability. You owe it to yourself and your family to understand your DISABILITY POLICY. Mr. Gavidia’s ability to explain the most important details was masterful. My initial conversation with Mr. Gavidia reminds me of our patients and how we sometimes would fail to explain things in laymen’s terms. And we wondered why our patients were confused? Now I know.

I would further suggest that you conduct an annual review of your policy with Dell & Schaefer to ensure your understanding and expectations to protect yourself and your loved ones. I am fortunate. I thought I had performed my “Due Diligence”. I had to a minimal level. Had I taken the initiative to contact this excellent group of experts, early on I could have protected my wife and children like a responsible spouse and father should. However, we are fortunate and blessed in that my disability insurance covers our very nominal financial requirements.

We have no additional funds for our children’s college nor do we live a lavish lifestyle. I simply receive the “minimum” to get by each month. I am very fortunate to have a “true expert” to take care of me and an insurance company, who to date has honored their contract. I thought I had performed my due diligence. In retrospect I was simply naive. While considered an “expert” in my profession with the highest accolades in the world I finally realized that it is impossible to know everything. My encouragement would be to focus on your passion and expertise and let those who are experts in their field help you.

I am very, very fortunate to have sincere and professional colleagues, Mr. Cesar Gavidia and his paralegal, Ms. Danielle Lauria help me through some very difficult times. I have returned to school and recently earned my MBA so I can “get back on my feet” and continue to help those who have blessed me so much. Dell & Schaefer helped me with this too. They encouraged me to do so when I thought the world had ended. In medicine we take an oath, “Do No Harm”. That should also apply to ourselves. Make sure you take care of yourself and your loved ones. You deserve it!

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