When faced with a disability claim, the definition and interpretation of "totally disabled" under your assigned plan is central to the outcome of your claim. As portrayed in Derichs v. AT&T Services, Inc., a recent US District Court for the District of Kansas case, the ambiguity contained in many plans could either hinder or aid your success.
Daniel Derichs was a participant in an employee benefit plan ("the Plan") that was administered by AT&T Services, Inc., and whose claims were handled by Sedgwick Claims Management. In January 2015, Mr. Derichs could no longer work and applied for short-term disability benefits under the Plan. After much back and forth, Sedgwick denied his claim in December 2015. Mr. Derichs appealed and then filed suit pursuant to the Employee Retirement Income Security Act ("ERISA"). The Court issued an order noting that the parties' definitions of "totally disabled" under the Plan was ambiguous and both parties were ordered to submit supplemental briefs for clarity.
Under the Plan, a person is "totally disabled" if they are unable to perform all of the essential functions of their job because of illness or injury. As noted, this definition is subject to different interpretations. First, this definition could be interpreted to mean that a claimant is totally disabled if the individual is unable to perform any of his essential job functions - meaning a claimant is not totally disabled if he can perform one essential job function but not the other. Second, this definition could be interpreted to mean a claimant is disabled if he cannot perform any particular essential function of his job, as he would then be unable to perform all of the essential functions of the job - meaning if there is one essential job function that cannot be performed, then the claimant cannot perform all the essential job functions. AT&T and Mr. Derichs applied these definitions to determine Mr. Derichs' disability, respectively. Though the Court determined both interpretations to be reasonable, the ambiguity outweighed the court's ability to determine which definition should be applied resulting in the noted supplemental briefs.
Generally, the Plan's administrator is given the discretion to interpret and determine its terms of eligibility for benefits of those individuals it covers; thus, the Court would uphold a reasonable interpretation made by the administrator. In this circumstance, however, the Court found it was unclear what interpretation the Plan's administrator used to decide Mr. Derichs' claim. For one, in their supplemental brief, AT&T neither argued that it applied a particular interpretation of the definition, nor did they argue that they should have had another opportunity to interpret the definition. Second, in the supplemental brief, AT&T only cited two cases that support their interpretation and based upon these court decisions, AT&T urged the Court to follow these two cases. To the contrary, Mr. Derichs did not argue that AT&T's definition was wrong, but rather that it was unreasonable because if an employee is unable to perform any particular function that is essential to the job, then the entire job cannot be fulfilled and that employee is subject to dismissal based on a disability. Accordingly, the Court interpreted the Plan in favor of Mr. Derichs and against AT&T, the drafter of the ambiguous language. The Court concluded Mr. Derichs' interpretation of "totally disabled" was most reasonable in that it upheld the Plan's clear purpose of providing benefits, because if any one essential function of a job cannot be performed, the employee's ability to perform the job, as a whole, is defeated.
Although the Court, in this case, construed the definition of "totally disabled" in light most favorable to Mr. Derichs, it noted it could not decide whether the Plan's administrator, using the definition adopted by the court, would have determined that Mr. Derichs' was "totally disabled." The Court recognized that there was indeed reliable evidence to support Mr. Derichs' inability to perform his particular job; however, the court also recognized that an administrator is not required to give special weight to the opinions of Mr. Derichs' physicians, or explain when they recognize evidence that conflicts with those opinions. Accordingly, the court ordered the claim be presented to the Plan's administrator once again to determine if Mr. Derichs was "totally disabled" under Mr. Derichs' interpretation of the definition adopted by the Court.