In the case of Van Steen v. Life Insurance Company of North America ,WL 256806 (10th Cir. Jan. 2, 2018) the Tenth Circuit, affirmed the district court's decision, finding that Life Insurance Company of North America's decision to terminate Mr. Van Steen's benefits was arbitrary and capricious. Mr. Van Steen was diagnosed with mild traumatic brain injury as the result of a physical assault. Initially he was prevented from working in any capacity. However, he was eventually cleared to return to work on a part time basis; but with noted limitations including the ability to rest frequently and work from home as necessary. At the time of his disability, Mr. Van Steen was employed by Lockheed Martin Corporation which provided disability coverage under the Lockheed Martin Group Benefits Plan. The short term and long term disability plans were both administered by Life Insurance Company of North America (LINA) and controlled by the Employee Retirement Income Security Act (ERISA).
In a recent case out of the Southern District of Indiana, Miller v. The Hartford Life And Accident Insurance Co., & Springleaf Finance, Inc. Disability Plan, No. 116CV00166TWPDML, 2017 WL 2214938 (S.D. Ind. May 19, 2017), the federal court found that Hartford failed to afford the Plaintiff a full and fair review of her ERISA governed disability insurance claim and remanded the matter back to Hartford to reevaluate the claim.
Most individuals who have filed any type of insurance related claim have experienced the delay and denial tactics used by their insurance company to avoid payment. Disability carriers often take extreme and arguably egregious measures to "prove" that a claimant is not disabled under the terms of their disability policy. In a recent case, the US District Court for the Northern District of California found Reliance Standard Life Insurance Company's (RSL) denial of benefits wrong and ordered the company to reinstate the Plaintiff's benefits.
In a recent case, Kennedy v. The Lilly Extended Disability Plan, No. 16-2314, __F.3d__, 2017 WL 2178091 (7th Cir. May 18, 2017), the Seventh Circuit Court, overturned a disability insurance benefit denial of a claimant with fibromyalgia. The claimant in the Kennedy case was the executive director of Lilly's human resources department, earning a monthly salary of $25,011. Kennedy was diagnosed with fibromyalgia and was suffering from its severe symptoms. Ultimately, she was unable to continue to work and filed a claim for disability benefits under Lilly's self-funded ERISA governed disability plan. Originally, Kennedy's claim was approved and she received benefits for over three years. However, the plan required Kennedy to undergo a physical evaluation over 100 miles from her home by a physician it hired. The "examination" lasted a mere five-minutes. The plan also hired a rheumatologist to conduct a records review of Kennedy's medical information, who falsely alleged that the American
College of Rheumatology does not consider fibromyalgia to be disabling on an extended basis. Based on the opinions of these two physicians, the plan terminated Kennedy's benefits.
In a recent decision, Ariana M v. Humana Health Plan of Texas, Inc., 2017 WL 1423765 (5th Cir. April 21, 2017), the Fifth Circuit Court of Appeals called into question the validity of its holding in Pierre v. Connecticut General Life Insurance Co./Life Insurance Co. of North America, 932 F.2d 1552 (5th Cir. 1991), in which the Fifth Circuit held that courts had to give deference to an ERISA benefit plan administrator's factual determinations, even if the plan did not contain a discretionary clause. Accordingly, under Pierre, a reviewing court cannot overturn an ERISA plan administrator's denial of benefits unless it found that the denial of benefits was arbitrary and capricious, an extremely high bar to reach for claimants.
A federal district court recently overturned Northwestern Mutual's denial of own occupation disability insurance benefits to an attorney with congestive heart failure unable to handle stress. The case Mustain-Wood v. Northwestern Mututal Life Insurance Company involved a family law attorney and partner at his own law firm who experienced congestive heart failure requiring major surgery and cardiac rehabilitation. 938 F.Supp. 2d 1081 (D. Co. 2013). Mustain-Wood became unable to practice as an attorney in part because of the high stress environment it required.
There are many things that an administrator or insurance company may not tell claimants about their rights in ERISA benefit claims and ERISA appeals (when there has been a denial of their ERISA benefits). Just a few of the many things that the insurance company may not reveal to claimants about their ERISA rights includes:
Most group policies that you obtain as a result of your employment are governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). ERISA is a federal statute that provides extremely strict deadlines and guidelines for claimants and insurance companies to abide by in the processing of a claim, submission of an appeal, and ultimately the determination of eligibility for benefits under a disability insurance policy. Most significant, ERISA creates an unequal claims process, placing strict obligations on individuals pursuing benefits that make maneuvering a claim difficult and frustrating for unaware claimants at a time when they should be focusing on their recovery. If you are applying for benefits or have been denied benefits under an ERISA governed Plan, you should be aware of your obligations in proving your claim and the strict deadlines you are working under. The question is, do you have the right information to be successful when applying for benefits under or appealing a denial of your disability insurance claim?
On June 25, 2012, the United States Supreme Court granted certiorari review in the case US Airways, Inc. v. McCutchen, which will greatly impact the landscape of employee benefits law, which is largely governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). In granting the writ of certiorari, the Supreme Court explained:
ERISA stands for the Employee Retirement Income Security Act which was passed by Congress and signed into law by President Ford in 1974. When the Employee Retirement Income Security Act ("ERISA") became law, it was codified as a part of Title 29 of the United States Code, and is found in multiple sections beginning with Section 1001. Essentially, the Employee Retirement Income Security Act is a federal law that supersedes state laws and regulates employee benefit plans and determines the rights of beneficiaries under those plans. This includes disability, life, health or long-term care insurance benefits that are provided to employees as a benefit of their employment by employers. The statute defines an "employee welfare benefit plan" as "any plan, fund or program . . . established or maintained by an employer or by an employee organization" which provides employee benefits. An "employee welfare benefit plan" subject to the Employee Retirement Income Security Act is easily created by an employer when establishing a plan to provide group insurance benefits to its employees. In fact, insurance policies and benefits obtained through an employer typically fall under this law.