Michigan Court Remands Aetna to Reconsider Disability Benefit Denial

In Coulter v. Aetna Life Insurance Company, a Michigan federal court found that Aetna committed a number of errors in its review of claimant Sharon Coulter’s medical file. In addition, it misinterpreted three separate Functional Capacity Evaluations (FCE). The Benefit Appeals Committee (BAC) for Alcoa, Coulter’s employer, relied on the information provided to it by Aetna to terminate Coulter’s long term disability benefits.

After detailed analysis of Aetna’s reasoning behind its recommendation to BAC to terminate Coulter’s benefits, the court stated, “Certain erroneous assumptions underlying Alcoa’s final decision render it arbitrary and capricious, and the Court remands to the plan administrator for reconsideration of Plaintiff’s claim for benefits.”

Summary of Basic Facts

After working for six years in the manufacturing section of Alcoa, plaintiff Sharon Coulter quit her job and was awarded short term disability benefits due to her bilateral carpal tunnel syndrome medical diagnosis. She later underwent shoulder surgery and was left with chronic pain and inability to resume her own occupation, so she was granted long term disability benefits. Even when the definition of disability changed to require her to be unable to work at “any occupation for which she was reasonably suited…,” her long-term disability benefits continued.

When Aetna took over as plan administrator of Alcoa, they reviewed Coulter’s medical file. The BAC for Alcoa relied on the information it received from Aetna and terminated her long term disability benefits. She lost her administrative appeal and so brought this ERISA lawsuit.

Court’s Analysis of the Evidence

Here, the final decision to terminate benefits was made by the BAC. Therefore, the court only analyzed the information provided by Aetna to the BAC that the BAC relied on it in making its decision. The court found that the BACs “own independent analysis of Plaintiff’’ disability claim appears to rest on the mischaracterization of the medical evidence…” Specifically, Aetna reported that Coulter could do “light to medium work” when three FCEs and medical opinions all found her capable of only performing sedentary work.

In addition, Aetna’s analysis of other jobs available to the plaintiff was flawed and, according to the court, “not supported by the record.” The jobs Aetna claimed she could do had no openings and employers who were interviewed were “‘unsure’ of whether they would be hiring in the next six months. There is no other evidence of anticipated job opportunity.”

Court’s Decision to Remand

The court struggled with whether it should award benefits or remand for reconsideration. Ultimately, it decided that remand to the plan administrator for reconsideration was the proper remedy finding that, “On this record, there is no clear entitlement to benefits and, in light of the above-mentioned defects, the Court believes that there are additional facts to develop and findings to be made as to Plaintiff’s functional ability and whether she is physically suited for the jobs selected for her.”

This case was not handled by our office, but it may provide claimants guidance when their claim for benefits is unreasonably terminated. If you need assistance with a similar matter, please contact any of our lawyers for a free consultation.

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