A disability attorney recently filed a federal ERISA lawsuit against the CIGNA Life Insurance Company of New York (CIGNA). The Plaintiff was forced to file suit after CIGNA repeatedly denied her disability claim.
The Facts of the Case Against CIGNA Life Insurance Company
Plaintiff suffered injuries that included bulging and herniated disks in her back in January 2004. She was examined and treated until it was determined that surgery was needed, resulting in her having a laminectomy to L4-L5 on March 21, 2005. This surgery was unsuccessful, which led to spinal fusion on L4-L5 on April 4, 2005.
After recovery from the above procedure, Plaintiff was hired as a Class I salaried employee by Ladenburg Thalmann & Co., Inc. on a full-time basis on or about June 15, 2005. Plaintiff was hired as a “Registered Representative and Branch Manager of Portfolio Management, Private Client Services.”
This job required her to do the following tasks:
- Generally travel between 3 to 4 hours each day to go to and from work, as well as work between the hours of 8 A.M. to 6 P.M. on all Mondays through Fridays when the stock market was open
- Be required to be at her desk and computer and/or on the telephone between the market hours of 9:30 A.M. to 4 P.M. because of her role as a licensed registered representative and her role in portfolio management
Plaintiff had a Long-Term Disability Insurance Benefits Plan that was insured and administered by CIGNA. She became fully covered by this plan according to its terms on or about January 1, 2006.
On or about May 19, 2006, Plaintiff became totally disabled due to what was diagnosed as failed back syndrome.
On June 7, 2006, Plaintiff filed notice and proof of claim for disability benefits with The Hartford, which was the short-term disability insurance carrier for LTC. This disability insurance covered Plaintiff for the first 180 days of disability. The period where she received payments was from May 27, 2006 to November 24, 2006.
On November 23, 2006, Plaintiff filed an application for LTD benefits; the application that included “Proof of Loss” did not define exactly what proof of loss or when it was due.
Denial of CIGNA Disability Benefits Claim
On January 2, 2007, CIGNA denied Plaintiff’s claim on the basis of the Policy’s pre-existing condition provision.
Plaintiff appealed that decision by letter via certified mail on February 14, 2007.
Social Security Disability Benefits were awarded to Plaintiff on April 29, 2007.
On June 27, 2007, the New York State (NYS) Court of Appeals ruled that N.Y. Insurance Law Section 3234(a)(2) “allowed insurers to limit benefits during the first 12 months of coverage, but not permit them to deny all benefits for disabilities stemming from preexisting conditions and arising during that 12-month period.”
On July 31, 2007, after the 90 days allowed by the ruling, CIGNA reaffirmed its prior denial of LTD Insurance Benefits based upon Plaintiff’s pre-existing condition.
On October 11, 2007, Plaintiff requested a review of that decision.
On October 29, 2007, defying the NYS Court of Appeals ruling, CIGNA does not accept Plaintiff’s appeal of CIGNA’s previous denial of LTD insurance benefits.
On February 14, 2008, CIGNA recanted its former administrative claim position about the policy’s pre-existing condition provision as a basis for the denial of disability benefits and due to the NYS Court of Appeals ruling would request additional information to determine if Plaintiff was disabled and entitled to LTD insurance benefits.
CIGNA took 493 days longer than allowed by ERISA to request for more medical information from the Plaintiff and to receive an Independent Peer Review from a board certified physician. Michael J. Sukoff, M.D., (Sukoff) a physician licensed to practice in California expressed his opinion that Plaintiff was able to return to work and that her pain syndrome was not supported by all examinations. This opinion differed from every other physician who submitted a report to CIGNA.
Based on Sukoff’s review, CIGNA refused the claim of the Plaintiff and advised her that she can submit a written appeal within 180 days to appeal this decision.
Plaintiff submitted appeal and submitted documents regarding her right knee, right hand, lumbar spine, carpal tunnel surgery on right hand, discography of lumbar, cervical spine, and 2 epidural injections to the cervical spine.
CIGNA upheld its decision to deny Plaintiff’s claim on December 11, 2008, again advising her of the option to appeal this decision within 180 days.
Again, Plaintiff appealed, this time via letter on May 24, 2009. She also included the following with her appeal:
- Plaintiff’s physician letter from May 19, 2006
- Physician letter from August 10, 2006
- 6-page Physical Residual Functional Capacity Assessment from April 10, 2007
- All medical tests performed from May 2006 to May 2009
- All medications taken from May 2006, including the amounts prescribed
CIGNA claims that it tried to contact Plaintiff by phone to discuss her appeal, but that the phone number was “no longer in service.” Plaintiff disputes this by stating that the phone has been in service for “more than 14 years.”
On September 2, 2009, CIGNA again affirmed its earlier denial of Plaintiff’s benefits claim and that no further appeals will be considered.
Disability Lawyer Files Lawsuit Against CIGNA
According to the lawsuit, Plaintiff alleged that CIGNA failed to provide the following to the Plaintiff:
- Information requested by the Plaintiff
- All documents pertinent to the denial of Plaintiff’s claim for LTD Benefits, which interfered with and delayed her ability to gather documents to present her position and to prepare a claim against Defendant CIGNA
- Copies of all communications and written notes pertinent to Plaintiff’s claim for benefits involving CIGNA and its Peer Review Physician, Dr. Sukoff
Plaintiff claims that CIGNA committed the following illegal acts:
- Unlawful denial of Policy benefits
- Willfully postponed and delayed handling procedures that prevented Plaintiff from receiving a full and fair review on the merits of her claim, as required by law
- Plaintiff suffering monetary loss and other damages
- Plaintiff delayed in gathering complete information necessary to prepare this claim, increasing attorney’s fees and court costs
- Conflict of interest due to having an adverse financial interest in the outcome of Plaintiff’s claim and exposure to substantial future expense
Relief Sought By The Plaintiff In The CIGNA Lawsuit
Due to CIGNA’s actions, Plaintiff is seeking the following from the Court:
- Declaration that CIGNA failed and/or refused to supply requested information
- Declaration that CIGNA’s willful failure and/or refusal to provide Plaintiff with all pertinent documents interfered with and delayed her ability to gather the necessary documents to present her position and prepare a claim against CIGNA
- Declaration that CIGNA’s requests for extensions of time did not fall under “Special Circumstances,” putting CIGNA in violation of ERISA’s terms of fulfilling requirements for timely submittal of documents to Plaintiff
- Declaration that CIGNA failed to establish and/or follow reasonable claims procedures that would yield a decision on the Plaintiff’s claim
- Declaration that CIGNA violated its LTD Benefits contract with Plaintiff
- Declaration that CIGNA’s actions were unconscionable
- Declaration that CIGNA is responsible for damages that include, but not limited to, past due contractual benefits, future benefits, present and future attorney’s fees, court costs, disbursements, and pre-judgment interest as allowed by law
- Any other and further relief that the Court deems proper and just.