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CUNA Mutual terminates disability benefits to woman suffering from depression and lyme disease

A Federal Appellate Court upheld an insurance company’s decision to terminate the long-term disability benefits of a woman who suffered from recurrent major depression. Although the woman claimed to now be suffering from Lyme disease, CUNA Mutual discontinued her benefits after two years due to the policy’s 24 month mental illness limitation. The Court agreed with CUNA Mutual that there was insufficient evidence to support her claim of disability due to Lyme disease. Let’s take a closer look to understand why the Court sided with CUNA Mutual.

Barbara Gent was the Vice President of Operations at Westerly Community Credit Union. A benefit of her employment was Credit Union’s long-term disability insurance plan. The plan’s benefits were paid under a long-term disability insurance policy issued by CUNA. CUNA also administered this ERISA-governed plan.

In March 2000, work-related stress led Gent is to see a therapist. There she expressed fears that the new president of her job was trying to take responsibilities away from her and ultimately fire her. Gent then met with her psychiatrist, Dr. A.H. Parmentier where she complained of depression, anxiety, sleep disturbance, poor energy, difficulty focusing, crying spells and the inability to think clearly. Dr. Parmentier diagnosed Gent with recurrent major depression and excused her from work.

In June 2000, Gent submitted a claim for long-term benefits under her disability policy. Dr. Paramentier’s required attending physician statement listed Gent’s diagnosis as recurrent major depressive disorder, and he indicated that Gent had a “Class 4” mental impairment, which meant that she was “unable to engage in stress situations or engage in interpersonal relations.” Dr. Parmentier did not mention any cardiac or physical impairments.

In August 2000, CUNA approved Gent’s claim for disability benefits. In the approval letter, CUNA prominently reminded Gent that her disability policy contained a mental illness limitation. The limitation stated that an insured who is disabled due to a mental illness may receive only a maximum of two years of disability benefits. It is very common for ERISA governed disability insurance policies to have a two years limitation for mental illness.

In April 2002, CUNA informed Gent that because of her mental illness limitation, her benefits would end in July 2002. After her benefits ended, Gent appealed claiming that the two year limitation did not apply because her disability now stemmed from a physical condition, Lyme disease. Gent alleged that she was bitten by a tick in 2001. CUNA asked Dr. Scott Yarosh, a psychiatrist, to review Gent’s medical records, and he concluded that the medical records do not document specific criteria to suggest that there were other disabling medical conditions. CUNA denied Gent’s appeal.

From 2002 through 2006, Gent appealed five more times where she sent medical opinions from various doctors who each came to different conclusions. Some found that Gent was disabled by Lyme disease; others said that if she was disabled, it was due to a depressive disorder. CUNA rejected all the appeals. In June 2006, Gent’s disability attorney filed an ERISA lawsuit in the Massachusetts Federal District Court. The district court agreed with CUNA and Gent’s Massachusetts disability lawyer filed an appeal with the Appellate Court.

The United States Court of Appeals Analysis:

The First Circuit Court of Appeals, using the preponderance of the evidence standard, found that CUNA’s evidence was much stronger than Gent’s evidence, and thus ruled that CUNA was correct in discontinuing Gent’s coverage.

The Court noted that while Lyme disease can be diagnosed using clinical evidence such as symptoms, objective physical findings such as a rash, facial palsy, or arthritis, and a history of possible exposure to infected ticks, it is also diagnosed using blood tests which measure the presence of Lyme antibodies in the patient’s blood. During such tests, doctors should first administer an “ELISA or IFA” test. If the ELISA is positive, doctors then administer a “Western blot test.” This test will typically be positive only if a patient has Lyme disease. The Court noted that the CDC has stated that, “(i)f the Western blot is negative, it suggests that the first test was a false positive, which can occur for several reasons.”

Although Gent reported an insect bite to one of her physicians in June 2001, and although she complained to various doctors of symptoms similar to those found with Lyme disease (Gent complained of fatigue, weakness, and achy joints), the Court noted that the Western blot test was negative for Lyme disease, as was a cerebro-spinal fluid test, which revealed no antibodies associated with the disease. The Court was also not persuaded by the four doctors that diagnosed Gent with Lyme disease. The Court noted that these doctors focused primarily on the clinical symptoms manifested by Gent. The Court noted that five other doctors involved in the case concluded that Gent did not have Lyme disease. These doctors focused largely on the laboratory data and clinical evidence.

Taking all the evidence into account, the Court found that CUNA’s argument was the better-supported position, and ruled that CUNA was correct in discontinuing coverage. The Court stated that “while one can reasonably interpret the clinical and neuropsychological evidence to either support or undermine a Lyme disease diagnosis, the laboratory data lines up almost uniformly against such a diagnosis.” Lastly, the court pointed out, that Gent’s history of depression makes the Lyme disease diagnosis more susceptible to questioning due to the overlapping of symptoms between the two disorders.

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