Court Orders Western & Southern Financial Group to Pay Short Term Disability Benefits
Author: Attorney Rachel Alters
In Devono Watson vs. Western & Southern Financial Group Flexible Benefits Plan (Plan), Plaintiff had been employed for more than 28 years as a Senior Case Analyst at Western & Southern Life Insurance Company when she became unable to work. She applied for short term disability (STD) benefits in August 2017 under her employee benefit plan provided by her employer. According to the terms of the Plan, she was entitled to STD benefits if she was “unable to perform the normal duties of her [their] regular occupation for any employer.”
Plaintiff’s regular occupation as presented in her job description required her to sit in a stationary position for long periods of time. She worked at a computer or other standard office equipment. Occasionally, she was required to work “extended hours” during “peak workloads or special projects.” She was also required to attend meetings.
In August 2017, Plaintiff was diagnosed with Grade IV osteoarthritis of her knees which was compounded by her morbid obesity. Her rheumatologist recommended she undergo bariatric surgery to help her lose weight. Then, she might be able to have both knees replaced. If that treatment plan was not possible, then the doctor concluded, “I’m going to have to put her on disability.”
On August 25, 2017, Plaintiff’s rheumatologist submitted a healthcare provider certificate to the Plan with her job description attached. He noted that she was unable to perform her job duties since she was “unable to attend meetings/get to her desk/or sit for extended periods of time.” He estimated she would need at least six months off work to see if limited ambulation would ease her constant pain.
At the request of the Plan, Plaintiff was evaluated by an orthopedic surgeon. The surgeon agreed with Plaintiff’s treating physician’s diagnosis and agreed “it is really difficult for the patient to ambulate due to her size.”
Shortly thereafter, a registered nurse employed by the Plan’s Benefits Department sent a denial to Watson stating that the “medical documentation submitted fails to support your claim for short-term disability benefits under the Plan.” Plaintiff was advised of her right to file for an administrative appeal with the Benefits Appeal Committee (Committee).
The Committee reviewed her appeal, but it did not solicit the opinion of another physician. The Committee itself reviewed her medical records and again denied her STD benefits on the same basis as its original denial. Plaintiff then filed this ERISA lawsuit on April 24, 2018.
In its decision finding in favor of Plaintiff, the Court stated “There is nothing debatable about Watson’s proof.” The Court ordered the Plan to award her STD benefits for the six months to which she was entitled benefits as well as prejudgment interest accrued beginning with the administrative appeal denial of benefits which occurred on November 15, 2017.
Western & Southern’s Decision Denying Plaintiff STD Benefits Was Arbitrary and Capricious
The Court held that Western & Southern’s decision denying Plaintiff STD benefits was arbitrary and capricious when the Plan:
Failed to consider Plaintiff’s relevant job duties. The Court stated that when an administrator fails to discuss the claimant’s job duties and its reasons for concluding the claimant is nor precluded from working, “this strongly suggests that the decision is arbitrary and capricious.” The Plan’s denial of benefits did not contain any analysis of her job duties or why it felt she could perform them.
The Plan, in conclusory terms, stated that she could perform the sedentary work of her job. “Sedentary” did not appear in the Plan’s terms. It required her to prove that she was unable to perform the “normal duties of her regular occupation for any employer.”
The Plan also said she did not prove that she could not work even with accommodations. “Accommodations” also is not mentioned anywhere in the Plan requirements. The conclusory denial letter issued by the Plan was arbitrary and capricious.
Failed to offer any reason for rejecting the opinion of Plaintiff’s treating physician. Although “plan administrators are not obliged to accord special deference to the opinions of treating physicians,” they must give reasons for “adopting an alternative opinion.” The reasons must be supported by the record.
The Plan acknowledged it had received the opinion of the treating physician that Plaintiff could not work but rejected his conclusions without any explanation as to why. This was arbitrary and capricious and a “plan administrator may not arbitrarily disregard reliable medical evidence proffered by a claimant including the opinions of treating physicians.”
Selectively reviewed the evidence. The Court noted previous cases have found that “an administrator acts arbitrarily and capriciously when it ‘engages in a selective review of the administrative record to justify a decision to terminate coverage.” In this case, the Plan found one phrase in the medical record where the treating physician said, “once she gets to her desk she is able to do her work” and used it as the basis for denying her claim.
The statement was taken out of context, in that the next phrase said, “but if she has to do any more walking during the day it is very difficult.” Additionally, the fact that claimants may be capable of sedentary work does not answer the question of whether they can perform the regular duties of their occupation when those duties include some degree of walking and standing.
Failed to conduct an independent medical examination (IME). When a Plan administrator accepts the opinion of a reviewing physician who has never examined the claimant over the opinion of the treating physician, without conducting an IME, it is yet another reason to conclude that the benefits determination was arbitrary and capricious.
Conducted its own file review without the aid of a physician. When deciding on an appeal from an adverse benefit determination, federal regulations require, at a minimum, that the medical file be reviewed by a health care professional who has appropriate training and experience. Here, the medical file was not reviewed by a physician or a nurse, but the Committee. There is no evidence that any physician is on the committee. This factor alone is enough to conclude the denial was arbitrary and capricious.
Remedy is Award of STD Benefits with Prejudgment Interest
The Court held that Plaintiff’s “disability is clearly supported by objective medical evidence and therefore remand would ‘be a useless formality.'” In this case, “the objective medical evidence is so clearly one-sided, Watson is entitled to her STD benefits.”
This case was not handled by our office, but we have handled many similar cases that have had similar positive outcomes. If you have any question about your disability claim or benefits to which you are entitled, contact any of our attorneys at Dell & Schaefer for a free consultation.