In Cummings v. Hartford Life & Accident Ins. Co. (Hartford), Plaintiff was employed by the Free-Port McMoran Corporation (Plan) when he became disabled due to diagnoses of degenerative disc disease which caused him chronic debilitating pain and myofascial pain syndrome.
Plaintiff was covered under his employer’s Group Long Term Disability Plan through Hartford and received long-term disability (LTD) benefits from May 3, 2010, to January 19, 2018, when Hartford terminated his benefits.
The termination came after a year-long investigation of Plaintiff’s entitlement to benefits. Hartford based its denial on:
- A phone interview where Plaintiff said he was raising four children by himself and his claim for Social Security Disability Insurance had been denied.
- Surveillance video that took place over three days in March 2017 which showed Plaintiff engaging in activities which reflected a “greater functionality that [Plaintiff] had self-reported.”
- A face-to-face interview with Plaintiff on June 26, 2017, where he exhibited behavior inconsistent with his behavior captured by the surveillance videos.
- Review of Plaintiff’s medical records by a Medical Case Manager (MCM) who was a registered nurse on Hartford’s staff who concluded “observed activities exceed his reported abilities.”
- An independent third-party peer review by Dr. Joseph Rea, a board-certified Occupational Medicine physician. Dr. Rea spoke to two of Plaintiff’s treating physicians, reviewed all medical records and the surveillance footage and concluded that Plaintiff could work at a Light Physical Demand Level category of work.
- Employability Analysis Report (EAR) which identified several occupations that fit with Plaintiff’s education, work history, and abilities.
- Hartford attempted to have Plaintiff undergo an Independent Medical Exam (IME) but was unable to get Plaintiff to schedule it. Plaintiff appealed the termination of LTD benefits.
Plaintiff’s Administrative Appeal
On administrative appeal, Plaintiff submitted more documents including a Functional Capacity Evaluation report (FCE) conducted by a physical therapist and an IME report by Dr. Timothy Hall. Both concluded that Plaintiff was “incapable of full-time work.” Plaintiff also submitted medical articles related to chronic pain.
Hartford reviewed the submission documents, including the IME and FCE and concluded that both “identified some function consistent with sedentary to light work which is supported by the surveillance video and the Independent Medical Review [IME] by Joseph Rea.” Hartford then referred the entire administrative file to another independent, third-party vendor who assigned the review to Dr. Michael Jacobs.”
Dr. Jacobs, board-certified in Physical Medicine and Rehabilitation, Pain Medicine, and Occupational Medicine, reviewed all the information provided including three MRI reports and all office notes of all treating healthcare practitioners. He agreed with the two diagnoses but disagreed with opinions saying Plaintiff could not work at all. He opined that Plaintiff could work full-time with some accommodations.
Hartford conducted another EAR which identified several occupations that fit Plaintiff’s abilities. Based on all this information, Hartford denied Plaintiff’s appeal.
Plaintiff then filed this ERISA lawsuit in the U.S. District Court for the District of Colorado. The Court determined that the proper standard of review was arbitrary and capricious standard meaning that “the decision will be upheld so long as it is ‘grounded on any reasonable basis.’” The Court then upheld Hartford’s termination of Plaintiff’s LTD benefits finding it was not an arbitrary and capricious decision.
The District Court Analysis
In the District Court, the Plaintiff raised several issues. The Court dealt with each one, applying the facts of Plaintiff’s case to Tenth Circuit precedent.
Hartford’s conflict of interest. Plaintiff alleged Hartford had a conflict of interest since it was “both the administrator and insurer of the [plan].” The Court did not give much weight to this argument since Hartford took steps to “reduce potential bias” by hiring two independent, board-certified physicians to conduct a peer review.
Plaintiff’s self-reporting was not credible. The Court gave Plaintiff little credibility when, for just one example, Plaintiff was seen on the video surveillance standing on a chair leaning over the engine of his care with a socket wrench in his hand working on the engine of his car. In a face-to-face interview with Hartford, Plaintiff “denied being able to do any maintenance or repairs on a vehicle.”
Medical opinions based on Plaintiff’s self-reporting were given little weight. The peer review reports generally agreed with the treating physicians’ diagnoses, but disagreed with the characterizations of Plaintiff’s functionality, which “heavily relied on his self-reporting.” The Court determined that Hartford, considering the video surveillance, reasonably placed greater value on the opinions of the reviewing physicians than the treating physicians.
Lack of an IME. Plaintiff, who had refused to schedule a physical exam, argued to the Court that Hartford should have conducted an IME. The Court noted that an IME is not required “to uphold the denial of ERISA benefits” particularly in this case where Hartford made a good faith effort to schedule such an exam.
Hartford reasonably relied on reports of insurance peer reviews by physicians Dr. Jacobs and Dr. Rea. Plaintiff argued that it was arbitrary and capricious for Hartford to rely on the reports of the peer review doctors instead of his treating physicians. The Court noted that “plan administrators are not obliged to accord special deference to the opinions of treating physicians.” The Court also noted that the reports reflected thorough review processes and that “Hartford’s reliance upon the peer review reports of Drs. Rea and Jacobs was reasonable and supported by substantial evidence.”
Prior approval of benefits. Plaintiff argued that evidence of Hartford’s prior payment of benefits should weigh in his favor. The Court held that prior paying of benefits does not prevent an administrator from denying benefits when the administrator receives new information.
Here, Hartford received new information with the surveillance footage, the face-to-face interview with Plaintiff, and the peer review reports. These all weighed in Hartford’s favor.
Plaintiff also argued Hartford erred by not reviewing the supplemental medical materials he provided and by not listing the occupations it believed met the Plan’s financial requirements. The Court determined that neither issue made the termination of benefits arbitrary or capricious.
Ultimately, the Court held in favor of Hartford on each issue and ruled its termination of benefits was reasonable and based on substantial evidence.
This case was not handled by our office, but we believe it can be instructive to those who have had their LTD benefits terminated after receiving them for many years. If you have questions about this case, or any question about your claim for short-term disability benefits or LTD, contact one of our disability attorneys at Dell & Schaefer for a free consultation.