Prudential ordered by Michigan Court to reconsider long term disability insurance denial

A Michigan Federal Judge recently ruled that Prudential Insurance Company Of America’s denial of long term disability benefits was arbitrary and capricious. The court found that Prudential ignored the claimant’s complaints of pain, failed to evaluate his occupational duties, ignored the opinions of his treating physicians, relied exclusively on a paper review of the medical records rather than examining the claimant, and failed to explain why the claimant could not work.

Despite Prudential’s wrongful denial of disability insurance benefits, the court sent the case back to Prudential for further review instead of awarding disability benefits to the claimant. and told them to reevaluate the case. Hopefully this disability claimant will be awarded disability benefits after Prudential conducts another review of the file. Lets take a look at the history of this case against Prudential and how a Michigan Court determined Prudential acted arbitrary and capricious.

Background of the Case

Alphons Bladowski, a computer-assisted design (CAD) technician at Midwestern Consulting L.L.C., was covered under disability insurance issued by Prudential Insurance Company of America (Prudential) as a part of his employment, and the benefits plan was governed by the Employee Retirement Income Security Act of 1974 (ERISA).

Bladowski had a hip replacement on his left side in 1989, a car accident in 2001, and cervical fusion surgery in 2002. Due to his complicated medical history, Bladowski was experiencing neck pain. In 2005 he complained of right shoulder pain and his x-ray revealed Bladowski suffered from AC joint DJD, supraspinatus tendinosis, and biceps tendonesis versus tear. Based on this report, Dr. Mark Pinto advised him not to lift, push or pull anything greater than ten pounds, and not involve in other activities which required his arms to able above chest height.

Bladowski had a right shoulder surgery including a rotator cutoff repair in 2006, and in his second follow up, Dr. Pinto reported that Bladowski was doing exceptionally well and could do most of his daily activities without difficulty, problems, complaints, or symptoms. Bladowski underwent arthroscopic rotator cuff re-repair in 2007, stopped working and applied for short-term disability benefits. Prudential approved Bladowski’s short-term disability from January 26, 2008.

When Bladowski reported that he was experiencing numbness and tingling in both his upper extremities, Dr. Susan Sullivan obtained and reviewed Bladowski’s MRI, which showed cervical spondylosis and postoperative changes, with associated foraminal narrowing at multiple levels, but without severe stenosis of the cervical spinal canal. Dr. Sullivan advised Bladowski to follow up through the Spine Clinic at the University of Michigan. Dr. Yang at University of Michigan found that Bladowski’s shoulder was doing well following his rotator cuff surgery, Bladowski was experiencing neck pain radiating down both arms.

Dr. Pinto’s report of February 2008 showed that despite some pain in his neck, shoulder pain and weakness, Bladowski had made improvements, and stated that these impairments were temporary and likely to improve with time and medical intervention.

Based on this medical information in Bladowski’s claim file, Prudential approved his long-term disability (LTD) benefits through April 3, 2008. Dr. Pinto reported that Bladowski would remain totally disabled until May 15, 2008, and Prudential subsequently extended his long-term disability benefits through that date.

Dr. Rodney Dewyer at the University of Michigan Pain Clinic reviewed Bladowski, and only commented that Bladowski was out of work for one more month as per orders from Dr. Pinto. Dr. Pinto’s report that Bladowski was experiencing numbness and tingling was supported by evaluation of Dr. Pankaj Guglani from the University of Michigan Pain Center, who scheduled a series of medical branch block injections to treat Bladowski’s symptoms.

Prudential extended Bladowski’s LTD (Long Term Disability) benefits throughout July and subsequently in August 2008 asked for an update on his condition. Bladowski indicated that his right shoulder was completely incapacitated and he was about to receive injections. Prudential informed that it would not approve further benefits until it receives additional medical records. In August 2008, Dr. Pinto indicated that Bladowski was doing well and recommended Bladowski “to increase activities as tolerated.”

Prudential informed Bladowski that his benefits were terminated effective September 1, 2008, as he no longer met the requirements for additional LTD benefits. Prudential explained that a claimant was ‘disabled’ when he or she was unable to perform the material and substantial duties of his or her regular job and had a 20% or more loss in monthly earnings due to sickness or injury to meet the requirements for disability. Based on a review of Bladowski’s medical records, Prudential asserted that Bladowski failed to show that he was unable to perform the duties of a CAD engineer, whose job was largely sedentary and would occasionally require lifting, carrying, pushing or pulling objects.

Prudential Denied Bladowski’s ERISA Appeal

Bladowski filed an ERISA appeal against Prudential’s termination of his LTD benefits and wrote to them about his schedule for hip surgery. Prudential received medical records of Bladowski’s hip surgery in January 2009, and as part of its second review, sent the file for an external review by its physician Dr. Kelly Agnew to comment on Bladowski’s impairment after September 1, 2008.

Dr. Agnew reported a 30 to 40 % reduction in Bladowski’s left-sided pain and noted right-sided numbness and tingling. Bladowski was subsequently diagnosed with carpal tunnel syndrome. Dr. Agnew indicated that Bladowski was unable to return to work due to diffuse pain and inability to perform for more than two to three hours of computer work at any given time. Dr. Agnew reported that Bladowski should not engage in repetitive extension, flexion, or rotation of his cervical region, and stated that Bladowski was not subject to any specific limitations with regard to sitting, walking, standing or driving and that barring any complications. According to Dr. Agnew, Bladowski was able to resume these activities without any restrictions within three months of his hip surgery.

Dr. Agnew admitted that it was difficult to tell what Bladowski’s self reported chronic pain might be from the review of medical records alone. There were multiple and significant diagnoses that could cause those complaints. Finally, Dr. Agnew asserted that Bladowski would be able to functions in the light duty range on a permanent basis and he would be permanently restricted for his lifetime.

Dr. Agnew confusingly asserted that after his hip surgery in November 2008, Bladowski would have been totally impaired for three months of post-operative recovery, and could function in a full-time sedentary capacity as on September 2008, and would be able to move into the light work range after three months of recovery.

Relying on Dr. Agnew’s report, Prudential informed Bladowski that his appeal had been denied. Prudential explained that Bladowski’s restrictions in September 1, 2008 would not have precluded him from performing the material and substantial duties of his occupation and affirmed its decision to terminate Bladowski’s benefits.

Left with no choice, Bladowski filed an ERISA lawsuit against Prudential

Bladowski argued that Prudential’s decision was arbitrary and capricious because it failed to consider the effect of his medications on his job performance, and it had a conflict of interest because it was both the plan administrator and the benefits provider.

Prudential Resorted To File review Instead Of Conducting Physical Examination:

In his ERISA lawsuit, Bladowski asserted that Prudential chose only to conduct a file review of his physician’s assessments, even when the Plan allowed Prudential to conduct physical examination to determine his pain levels or his specific job requirements. Bladowski argued that the Court should give less deference to Prudential’s termination of his benefits.

The Court stated that the file review by a qualified physician was not inherently objectionable. It agreed with Bladowski’s argument, relied on Calvert v. Firstar Fin., Inc., 409 F. 3d 286, 296-97 (6th Cir. 2005), and opined that “the failure to conduct a physical examination – especially where the right to do so is specifically reserved in the plan – may in some cases, rise questions about the thoroughness and accuracy of the benefits determination.”

Prudential and Its Physician Failed To Address Determinations By Bladowski’s Physicians

The Michigan Court found that several perplexing omissions existed, both in Dr. Agnew’s and Prudential’s assessments:

1. Both Dr. Agnew and Prudential failed to address determinations by Bladowski’s treating physicians that he was unable to work as of September 1, 2008, the date of termination of benefits.
2. Both Dr. Agnew and Prudential didn’t provide any explanation as to why they concluded that Bladowski would be able to function in a light range on a permanent basis, when Dr. Agnew’s summary of medical records clearly showed that Bladowski was unable to return to work due to diffuse pain and was unable to perform more than two to three hours of computer work at any given time.

Relying on Glenn v. Metlife, 461 F. 3d 660, 665 (6th Cir. 2006), the Michigan Court stated that although a Plan administrator was not required to accord special deference to the opinions of the treating physicians, it cannot arbitrarily repudiate or refuse to consider the opinions of the treating physicians. Prudential could not simply cherry-pick the evidence from the record that was favorable to a decision to terminate benefits and arbitrarily disregard unfavorable evidence. The Court noted Prudential’s failure to provide any explanation as to why it concluded that Bladowski could not work, and stated that Prudential’s decision was arbitrary and capricious.

Prudential Failed To Address Bladowski’s Pain issue:

Both Dr. Agnews and Prudential neither discussed Bladowski’s statement that he could not work due to diffuse pain nor addressed Dr. Dewyer’s statement that Bladowski had borderline control over his neck pain and Dr. Guglani’s report that Bladowski told him that he could only work for three hours in his home office before running out of pain tolerance. The Court found that Prudential’s decision to terminate Bladowski’s benefits without giving any reasoned explanation for its determination that Bladowski could work despite his reported pain was arbitrary and capricious. The Court remarked Dr. Agnew was unable to evaluate Bladowski adequately because he had asserted that it was difficult for him to tell from the medical records review alone exactly what Bladowski’s self reported chronic pain might be.

Prudential and Dr. Agnew Failed To Address Assessments Of Bladowski’s Ability To Work, His Pain Levels And Evaluation Of Job Duties:

Although Bladowski’s job was sedentary, neither Dr. Agnew nor Prudential evaluated whether Bladowski could perform the essential duties of his job, including drafting detailed constructions drawings. Instead, Prudential just listed a series of limitations and restrictions and based on this list determined that Bladowski could perform full-time sedentary work. Dr. Agnew and Prudential did not provide any reasoned explanation for their determination although they admitted that Bladowski suffered from multiple impairments.

Prudential Failed To Take Note Of Baldowski’s Hip Surgery and Contradictory Statements by it’s Physician – Dr. Agnew

In his report, Prudential’s physician Dr. Agnew stated that Bladowski could function in a sedentary duty capacity, but contradicted his own assessment by agreeing that Bladowski required three months of postoperative recovery as he underwent hip revision in November 2008. Dr. Agnew’s statement that there was no specific limitations of walking, sitting, standing or driving were recommended after post operative recovery indicated that there were restrictions on Bladowski’s activities during the recovery period.

Seeing Dr. Agnew’s contradictory statements and confusing analysis of Baldowski’s hip surgery and Prudential’s failure to consider Bladowski’s doctor’s opinions, the Michigan Court opined that Prudential’s decision to terminate benefits lacked deliberate reasoning and was arbitrary and capricious.

Court Remanded The Case To Prudential For Proper Evaluation Of Bladowski’s Long-term Disability Benefits Claim

Although Bladowski did not get relief of summary judgment to recover long-term disability benefits, the Court determined that Prudential failed to engage in a deliberate and principled reasoning process, and ordered Prudential to reevaluate the claim. The Judge had the discretion to order Prudential to pay benefits, but the Judge did not believe he had sufficient evidence to determine if Bladowski was disabled. This is a partial victory for the Plaintiff as his claim is still alive, but Prudential now has another chance to possibly deny disability benefits again.