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Reliance Standard long-term disability benefits decision affirmed by Circuit Court

When an insurance company uses a deliberate, principled reasoning process, supported by enough evidence, the United States court system will stand behind them. This fact is highlighted by a case that was argued before the United States Court of Appeals, Sixth Circuit, which covers the states of Kentucky, Michigan, Ohio and Tennessee. Arguments were heard by the judges on December 1, 2009 and a decision was filed on February 5, 2010.

First we should begin by looking at the claim history in Balmert’s case

Maribea Balmert, an employee at Big Lots, participated in a long-term disability insurance plan through their employer. Reliance Standard Life Insurance Company (Reliance Standard) administered the plan. Her position as an accountant/tax analyst required long hours at a computer. Balmert, who suffered from rheumatoid arthritis, complained in August 2004 that her symptoms had intensified to the point she could no longer work.

When her rheumatologist, Dr. Kevin Hackshaw examined her on August 26, he felt that she was complaining of pain that was disproportionate relative to the synovitis that he could see. He suggested that her symptoms of pain could be connected with another etiology, such as stress. He referred her to a neurologist and a psychologist and placed her on temporary medical leave.

During an August 30 visit, Balmert told her psychologist, Dr. Wanda McIntyre, that she had been experiencing pain for a number of years, but that her pain level had intensified. Dr. McIntyre noted that Balmert indicated her desire to return to work, but not under the hours, pressure and stress that she had been handling. Balmert continued to see Dr. McIntyre every two weeks until she discontinued counseling in December 2004. The primary focus of each session was stress management in an effort to prepare Balmert for her return to work.

On October 21, Dr. Hackshaw evaluated Balmert’s condition. At this point, he noted that her rheumatoid arthritis appeared to be under good control. He cleared Balmert’s return to work with some limitations. He recommended she explore some type of flex plan that would allow her to take some of her computer work home or that she seek a less stressful position. Balmert reported this news to Dr. McIntyre, voicing her concerns that she would be unable to return to work.

Dr. Hackshaw again evaluated Balmert’s condition on February 10, 2005. During this visit he noted that she had no tender points and no detectable synovitis. He noted that she had told him that Big Lots would not accommodate her limitations. A May 19 visit resulted in the same evaluation, as did her subsequent visits on August 18 and November 21.

Now let’s examine the evidence that led to Reliance Standard’s denial of long-term disability benefits to Balmert

Balmert filed a long-term disability benefits claim with Reliance Standard on February 15, 2005. She received a letter on June 2, 2005 denying her claim for long-term disability. The letter stated that her documentation did not demonstrate that she had a physical condition that would preclude her from performing the material duties of her own occupation. She appealed, providing additional medical and supplemental information pertaining to her claim.

The most important evidence submitted by Balmert in support of her appeal was a modified functional capacity evaluation conducted on March 15, 2006 by physical therapist Matthew Crill. This report stated she was experiencing a lack of sitting tolerance and standing tolerance, a severe deficiency in upper extremity strength, a severe deficit in her fine motor skills and a chronic and intractable subjective pain rating. This report was forwarded to Dr. Hackshaw. He responded, in a letter dated July 25, 2006, that he had been following Balmert since 2004 and agreed that her condition had not changed since that time.

Reliance Standard responded by requesting that Balmert be seen an independent medical examiner, Dr. Marvin Thomas. The results of the independent review paralleled that of Dr. Hackshaw. He confirmed that she did have rheumatoid arthritis, but there was little evidence that the disease was active. He found that her rheumatoid arthritis appeared to be controlled, and he could see no reason why she would be unable to continue her present position. He could not find a rheumatological basis for her disability. He also reviewed the administrative record, and stated on November 2, 2006 that while her initial records indicated that she would have had difficulty keyboarding, he saw no evidence that this should still be a problem.

After reviewing the record, Reliance Standard determined that between August 26, 2004 and September 29, 2006, Balmert would have had trouble performing her own occupation. They determined to grant her benefits during this time period only. They notified Balmert by letter on December 14, 2006 of their decision, noting that she was not qualified for benefits beyond September 29, 2006. She was advised that her case was now closed, and that their claim decision was final.

Balmert filed an ERISA claim against Reliance Standard on February 8, 2007. Her claim challenged the limited grant of long-term disability benefits. The District Court granted judgment on the administrative record to Reliance Standard on September 22, 2008 and Balmert appealed.

The Appeals Court reviewed the District Court’s ruling based on a standard known as the arbitrary-and-capricious standard of review because Reliance Standard as the plan administrator had discretionary authority to interpret the terms of the plan and to determine who is eligible for benefits. Under this standard, the court upholds the plan administrator’s decision as long as it was reached by a deliberate, principled reasoning process, and the decision was supported by substantial evidence.

Balmert claimed that she had not received a full and fair review because the final reason for denying her benefits was different from the initial reason Reliance Standard provided. The court found that this contention meritless. They found that the original denial letter of June 2, 2005 stated that Reliance Standard was denying long-term disability benefits because there was no documentation that supported her claim. In their December 14, 2006 letter, Reliance Standard once again pointed to a lack of evidence for her disability.

Balmert also argued that she was not given an opportunity to respond to the independent medical examiner’s report, denying her a fair hearing. Reliance Standard argued that there was no legal precedent requiring them to do so. The court chose not to consider the matter, because Balmert had made no attempt to rebut Dr. Thomas’ medical opinion, which was attached to the December 14, 2006 denial letter. The administrative record provided no evidence that she had requested a copy of his report or that she had made any effort to rebut it.

Balmert next tried to argue that a willingness to provide benefits during the closed time period but to then deny continuing long-term disability was arbitrary and capricious. The court disagreed. The court found that her own treating physician’s reports backed up the independent medical review. The court would have found a complete denial of long-term disability benefits reasonable. With the administrative record based entirely on supporting her disability on the basis of rheumatoid arthritis, the court found the evidence of the disability was insufficient. The court found Reliance Standard’s decision was not arbitrary or capricious.

So why did Balmert lose? She lost because she had not provided compelling evidence of her disability and she never challenged the IME report prior to filing a lawsuit.

Comments (6)

  • Vonnie,

    It is unusual that Reliance Standard would forward you benefits through August 2014 at this point and time. I would assume your policy has a two year “own occupation” definition of disability, and as such they are essentially deeming you disabled from your own occupation, but not from “any occupation.” The outcome of your SSDI hearing could have a very important impact on the future of your claim with Reliance Standard. Please feel free to contact our office to discuss your options.

    Stephen Jessup Dec 31, 2013  #6

  • I was receiving long term disability from reliance Standard since August 2012. I just received a call from Reliance stating that my case will be closed because they stated that after their medical review I can do sedentary work. They gave me a lump sum check that will pay me up until August 2014. My condition has not changed so I don’t understand. I also have a SSDI hearing next month. If I win, will I still have to pay Reliance back pay? Or if I lose will I still have to pay back pay? Should I appeal Reliance’s decision to close my case?

    Vonnie White Dec 30, 2013  #5

  • Regina,

    Congratulations. Once you win a case a trial by a judge, the company then has 30 days to decide if they want to appeal the decision. If they appeal, then you will not get paid until the appeal is over. If the company decides not to appeal, then you could be paid within 30 days of a Judge’s final order.

    Gregory Dell Mar 8, 2013  #4

  • I was just recently approved for disability by a judge. How long does it take to start getting my disability check and backpay? Who should I contact to find out?

    Regina Moore Mar 7, 2013  #3

  • Michael,

    It is very common to have a disability insurance policy where the definition of disability changes after 24 months of benefits. The definition of disability usually changes from Own Occupation to Any Occupation. However Any Occupation is not as simplistic as “flipping burgers”. It must be a job that you could perform with reasonable continuity. Also the definition of “Any Occupation” is different with every policy. Please contact us if you have any questions. You need to anticipate the change in definition as the disability company will start their change of definition evaluation at about the 18 month mark.

    Gregory Dell Jul 7, 2011  #2

  • I received a lump sum from Reliance Standard for 2 years of disability: 09-11. After that, they say the disability standard must be that you can’t work at any kind of job. The first 24 months standard is that you can’t work at your current occupation. Is this correct?

    Michael Kanaly Jul 7, 2011  #1

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We represent Reliance Standard clients nationwide and we encourage you to contact us for a FREE immediate phone consultation with one of our experienced disability insurance attorneys.

Can you help with a Reliance Standard disability insurance policy?

Our disability insurance lawyers help policy holders seeking short or long term disability insurance benefits from Reliance Standard. We have helped thousands of disability insurance claimants nationwide with monthly disability benefits. With more than 40 years of disability insurance experience we have helped individuals in almost every occupation and we are familiar with the disability income policies offered by Reliance Standard.

How do you help Reliance Standard claimants?

Our lawyers help individuals that have either purchased a Reliance Standard long term disability insurance policy from an insurance company or obtained short or long term disability insurance coverage as a benefit from their employer.

Our experienced lawyers can assist with Reliance Standard:

  • ERISA and Non-ERISA Appeals of Disability Benefit Denials
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Yes. We are a national disability insurance law firm that is available to represent you regardless of where you live in the United States. We have partner lawyers in every state and we have filed lawsuits in most federal courts nationwide. Our disability lawyers represent disability claimants at all stages of a claim for disability insurance benefits. There is nothing that our lawyers have not seen in the disability insurance world.

What are your fees?

Since we represent disability insurance claimants at different stages of a disability insurance claim we offer a variety of different fee options. We understand that claimants living on disability insurance benefits have a limited source of income; therefore we always try to work with the claimant to make our attorney fees as affordable as possible.

The three available fee options are a contingency fee agreement (no attorney fee or cost unless we make a recovery), hourly fee or fixed flat rate.

In every case we provide each client with a written fee agreement detailing the terms and conditions. We always offer a free initial phone consultation and we appreciate the opportunity to work with you in obtaining payment of your disability insurance benefits.

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No. For purposes of efficiency and to reduce expenses for our clients we have found that 99% of our clients prefer to communicate via telephone, e-mail, fax, GoToMeeting.com sessions, or Skype. If you prefer an initial in-person meeting please let us know. A disability company will never require you to come to their office and similarly we are set up so that we handle your entire claim without the need for you to come to our office.

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When you call us during normal business hours you will immediately speak with a disability attorney. We can be reached at 800-682-8331 or by email. Lawyer and staff must return all client calls same day. Client emails are usually replied to within the same business day and seem to be the preferred and most efficient method of communication for most clients.

Dell & Schaefer Client Reviews   *****

Jeff S. (Kansas)

Due to my vision and health issues testimonials are not typical of me. Dell & Schaefer however did such a sensational, and professional job we felt it absolutely necessary to share the experience.

I had been thinking of pursuing a lump settlement on long term disability with the insurance company for some time. Decided on Dell & Schaefer after much research on several firms across the country. Residing in the Midwest did cause some reservations about choosing a firm around 1500 miles away. However shortly after choosing Dell & Schaefer my concerns where quickly put to rest by how proficient the team is, and how they are always there with you. Never waited for a response and always felt like we knew exactly what was going on every step of the way.

I got the pleasure of working with Mr. Stephen Jessup Esquire, along with Sonia R. Nogueira, and team on my case. After contemplating my situation Steve was contacted to let him know it would be about three months before moving forward. I mention this because no pressure was ever felt to pursue or take a settlement and the firm awaited me to contact them again. No annoying emails, calls, letters, or any type of pressure to hire them. When questions arose the team was right there for me through the entire process and only a phone call or email away. Never had to wait for a response before or after retention. Mr. Jessup at one point during my case was out of country and still offered guidance when needed, almost immediately after emailing. Sonia also went above and beyond and took my call around six P.M. on a Friday to help me with some document questions. Simply an incredible level of service that seems rare anymore. I always felt truly comfortable!

Mr Jessup and everyone with the firm seemed to have a very good rapport with the insurance company. I mention this because within about two weeks of retention we had the first offer. Within less than four weeks we had reached a settlement agreement, and funds where in my account about two hassle free weeks later. This all transpired even with delays of the insurance rep taking vacation twice. Overall my settlement expectations where far exceeded. During the original consultation Mr. Jessup mentioned a monetary figure that was lower than the actual final settlement. There where no false promises or over inflated estimates as sometimes found elsewhere. Just an upfront honest answer of what could be to come. During the process I still received my monthly benefit and never had to deal with the insurance company directly. This in itself took so much stress out of my life. After three years I no longer had to continually jump through hoops when the insurance company requested something or worry that I might undeservedly lose benefits.

The above is just a small part of my experience on how I felt the professional and courteous team was always willing to go the extra mile. If you or someone you might be concerned about are in need of guidance my opinion is a better choice could not be made than contacting the team at Dell & Schaefer about options.

Because of the work done by those at Dell & Schaefer I now have the funds to live while attempting medical procedures that insurance will not cover. Hopefully because of this someday I can return to a career as I’m still almost twenty years from retirement age.

Thank you all at the firm again for returning some normalcy to my life and treating me like a person not a case!

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