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Cognitive deficits are an important consideration when determining disability. However, insurance companies tend to undervalue the debilitating impact that pain medication can have on a person’s mental state. If a claimant is suffering from cognitive deficits, the insurance company will usually handle the claim in one of two ways.

First, insurance companies will ignore the claimant’s cognitive complaints and proclaim work capacity in a sedentary occupation. This claim mishandling was seen in Mossler v. Aetna Life Ins. Co., 2014 U.S. Dist. LEXIS 89046 (C.D. Cal. June 30, 2014), where the court reviewed the denial of Long Term Disability benefits to a Senior Vice President, who had become disabled due to symptoms including widespread pain, fatigue, side-effects of medications, and cognitive deficits. Aetna denied Mossler’s benefits based on the opinion that he could perform a “sedentary” occupation. However, the court rejected Aetna’s basis as incorrect, pointing out that “even assuming Plaintiff could perform sedentary work, [Mossler] has many other intellectual responsibilities that require both financial expertise as well as a high level of interpersonal skills.”

Second, insurance companies are quick to disregard cognitive complaints when attributed to necessary narcotic pain medication. Many of our clients suffer from chronic pain and treat with pain management specialists. Prescribed narcotic pain medication is problematic because it can impact cognition. Courts recognize that effects of narcotic medication cause disability. For example, a court in determining that Unum unreasonably denied a claim based on its assumption that Bencivenga’s medical condition had improved with his reduction in the number and strength of prescribed pain medication does not automatically mean that his chronic pain has improved. A change in a claimant’s “medication regimen is [not] evidence of any vast improvement to his underlying medical condition” given his prolonged use of narcotic medication. Bencivenga v. Unum Life Ins. Co. of Am., 2015 U.S. Dist. LEXIS 39117 (E.D. Mich. Mar. 27, 2015).

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In many long-term disability insurance policies, insurance companies struggle to almost always apply a mental illness limitation when the insured has both mental and physical complaints. The language in these mental illness limitations vary by policy. In George v. Reliance Std. Life Ins. Co., 776 F.3d 349 (5th Cir. Tex. 2015), the Court grappled with the “caused by or contributed to by” language in the mental illness limitation in Reliance Standard Life Insurance Co.’s policy, which reads “Monthly Benefit for Total Disability caused by or contributed to by mental or nervous disorders will not be payable beyond an aggregate lifetime maximum duration of twenty-four (24) months.”

This Court had never considered the meaning of this phrase, but other courts concluded that this language excludes “coverage only when the claimant’s physical disability was insufficient to render him totally disabled”. The Fifth Circuit agreed with this “but-for cause” interpretation, especially since Reliance had advocated for this interpretation in the past. For example, in Gunn v. Reliance Std. Life Ins. Co., 2010 U.S. App. LEXIS 17436 (9th Cir. Cal. 2010), Gunn was required to show that he was totally disabled “solely due to his physical conditions stemming from his multiple sclerosis, without taking into account the disabling effects of any mental or nervous disorders”.

In light of this interpretation, the Court had to consider whether George’s physical disabilities were independently sufficient to render him Totally Disabled. George, as a United States Army helicopter pilot, had his leg amputated following a helicopter crash. Although George’s depression and post-traumatic stress disorder contributed to his employment status, the Court determined that he was disabled due to his physical impairments irrespective of his psychiatric condition, taking him outside of the mental illness limitation.

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Litigation to recover denied disability benefits is costly. Not only must the claimant suffer the absence of any disability benefits during the court case, but they must pay counsel for representing them in court. Most attorneys charge a contingency fee for representing disabled claimants in federal litigation; our office is no exception. This means, that if our client is successful, then our fee is paid. Fortunately, ERISA provides that the court, in its discretion, may order that the successful party receives counsel fees from the culpable party. This means that the court may decide that a claimant’s attorney’s fees are paid in part, by the insurer! In our experience, this occurs about 50% of the time. This is totally up to the court’s discretion. See 29 U.S.C. §1132(g).

It is important to understand how the court gauges whether the claimant is the successful party. What happens if the case settles soon after the Complaint is filed, and before the court is substantially involved in the case? What if, as a result of the lawsuit, the defendant voluntarily pays the benefits due? What should the court use as its barometer? Our third circuit court of appeals recently had an opportunity to clarify the law on this subject.

The usual standard for fee awards is the achievement of “some degree of success on the merits.” Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010). Just recently in Templin v. Independence Blue Cross, No. 13-4493 (3d Cir. May 8, 2015), the Third Circuit decided that the standard, “success on the merits” can be met without any judicial action. In Templin, plaintiffs brought claims under ERISA based on the refusal of the defendants/insurance companies to honor claims for payment of blood-clotting-factor products. After settling the case, the claimants sought $349,385.15 in attorney’s fees. The lower court ruled that the claimants had failed to achieve “some degree of success on the merits”. The claimants argued that they were entitled to attorney’s fees under a catalyst theory.

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When you become unable to continue working for an employer due to disability which is long-lasting, you may approach the employer for a severance if it is determined you will never be able to return to that employment. If you are fortunate enough to obtain a severance, be careful, because the agreement you are required to sign with your employer may reduce or even eliminate your rights to later pursue your disability claim. This may be the case even if the insurer of the disability plan is not specifically identified in the severance agreement by name.

Additionally, if you have a dispute with your employer which culminates in termination after the disability claim begins, an agreement to resolve that dispute may impair your rights to pursue a disability claim. That is what occurred in Gonda v. Permanente Med. Group, Inc., 2015 U.S. Dist. LEXIS 18892 (N.D. Cal. Feb. 17, 2015).

Gonda signed a settlement agreement with his employer following his termination. That agreement did not include any language referring to the disability plan other than to state in general terms that all ERISA claims are released. The agreement stated in part: “Dr. Gonda and his agents, successors and assigns agree to release and forever discharge TPMG, KFH, Kaiser Foundation Health Plan, Inc., . . . of and from any and all claims, charges, demands, actions, obligations, liabilities, and causes of action of whatever kind or nature, whether known or unknown . . . concerning or related to his employment by TPMG and Kaiser Foundation Health Plan credentials or his staff privileges at KFH whether based on . . . the Employee Retirement Income Security Act.”

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In Stevens v. Liberty Mutual together with esteemed attorney, Mark D. DeBofsky, Esq. of DeBofsky & Associates, P.C. we continue our battle against Liberty to reverse their denial of disability benefits to a disabled bank employee. We won our motion for summary judgment in January, and the Court ordered that Liberty pay Mr. Stevens his short term disability benefits, plus our counsel fees. Our claim for Long Term Disability Benefits was remanded to Liberty to review the evidence and made another benefits determination. Instead of proceeding with the remand, Liberty appealed the entire decision to the Third Circuit Court of Appeals.

Oral argument before the Court of Appeals on May 20, 2015 will center on whether the Court of Appeals has jurisdiction to hear Liberty’s appeal since the case is not concluded and the district court retains jurisdiction over the case.

Joseph Stevens suffers from ankylosing spondylitis, joint swelling, pain, fatigue, and cognitive issues. His case continues and will not be completed until we have a determination on the long term disability claim. Our success before the district court is available. Stevens v. Liberty. We will update the blog once the Third Circuit decides our case. Hopefully the result of tomorrow’s argument will change the law in the State of New Jersey. Contact us at Bonny G. Rafel, LLC, and let us fight for your disability.

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Often our clients are denied disability benefits on the basis of the insurers’ conclusion that they can work in a “sedentary occupation.” Insurers also base their analysis often on something known as the “national economy.” By ignoring the demands of our client’s individual job workplace and environment, the insurers misclassify a job and the duties required to perform it. This unfairness permeates many vocational reviews. Fortunately, the courts have addressed this situation in several cases.

Courts have consistently rejected the argument that the specific tasks listed by a claimant’s own employer are irrelevant to an occupational analysis, noting that “while the correct standard is the occupation in the general economy and not the specific job for a specific employer, the specific duties of the employee’s job, as described by the employer, are relevant.” See Burtch v. Hartford Life & Accident Ins. Co., 314 Fed. Appx. 750, at 4 (5th Cir. 2009). The law is clear, that the disability assessment must be based on the occupation that the insured was actually performing: the actual job duties and not a reference to how the position might be performed in the local economy. Polnicky v. Liberty Life Assur. Co. of Boston, 2014 U.S. Dist. LEXIS 164890 (N.D. CA Nov. 25, 2014).In the ERISA context, an administrator must consider a claimant’s inability to perform his specific job requirements of a position in light of the relevant symptoms and medical conditions. Miller v. Am. Airlines, Inc., 632 F.3d at 854-55 (3d Cir. 2011).

The 1st Circuit Court of Appeals recently addressed this situation in McDonough v. Aetna Life Ins. Co., 2015 U.S. App. LEXIS 6153 (1st Cir. Mass. Apr. 15, 2015). In deciding that McDonough was no longer disabled, none of Aetna’s medical consultants or vocational reviewers considered the demands of his high-pressured position in the national economy or how “his symptoms would affect his ability to meet those demands.”

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A recent ruling received by Bonny G. Rafel, LLC examined the recent habit of insurers tampering with the ERISA regulated mandates for deciding appeals of denied ERISA claims. We have received many letters from insurers advising us that they will not start the appeal review until we notify them that we will not be furnishing anymore medical records to them for consideration. We have always contested that unilateral roadblock to providing proof during the appeal that our clients remain disabled! The law is clear as to the obligation of the insurer to decide the appeal no later than 90 days after the submission of the appeal.

ERISA requires all employee benefits plans to “afford a reasonable opportunity to any participant whose claim for benefits has been denied for a full and fair review by the appropriate named fiduciary of the decision denying the claim.” 29 U.S.C. § 1133(2). The Secretary of Labor has established regulations implementing the minimum requirements under ERISA for employee benefit plan procedures pertaining to beneficiary claims. These regulations include time limits by which an appeal of a denial of benefits must be decided. ERISA provides: “the plan administrator shall notify a claimant . . . of the plan’s benefit determination on review within a reasonable period of time, but not later than [45] days after receipt of the claimant’s request for review by the plan, unless the plan administrator determines that special circumstances (such as the need to hold a hearing, if the plan’s procedures provide for a hearing) require an extension of time for processing the claim. If the plan administrator determines that an extension of time for processing is required, written notice of the extension shall be furnished to the claimant prior to the termination of the initial [45]-day period. In no event shall such extension exceed a period of [45] days from the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the plan expects to render the determination on review.” 29 C.F.R. § 2560.503-1(i)(1)(i) & (i)(3)(i). (emphasis added).

There is a regulation that provides a plan the right to “toll” the deadline if they request certain documentation missing from the submission. But that is not at all what happened here to our client.

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In general, if a group insurance benefits plan pays benefits such as medical bills or disability benefits related to an event caused by another “third party”, such as an automobile accident, the plan has the right to recoup their payment from the claimant’s collection of money (“recovery”) from the “third party.” This often stymies the rights of the sick, ill and disabled because after reimbursing the bills paid by the plan, there may be little left for their pain and suffering and permanent injuries or loss of income.

The United States Supreme Court recognizes these rights and how “a health-plan administrator . . . may enforce such a reimbursement provision [in a benefits plan] by filing suit under § 502(a)(3) of ERISA.” US Airways, Inc. v. McCutchen, 133 S. Ct. 1537, 1542 (2013).

An interesting case was decided recently in Indiana that brought to light a provision in a plan that I had not seen before. In Smith v. Walmart Stores, Inc. Assocs. Health & Welfare Plan, 2014 U.S. Dist. LEXIS 143716 (S.D. Ind. Oct. 9, 2014), the Plan sought reimbursement for the benefits Smith had received. Walmart’s plan had a clause that if notified that the claimant had become totally disabled, within the first year they would waive their right for reimbursement. Smith had twelve months after being notified of the reimbursement claim, to seek a waiver of the reimbursement due to “total disability.”

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The 11th Circuit recently decided an important case in the grey area of when does the deadline for filing litigation expire in a disability claim. In Witt v. MetLife,2014 U.S. App. LEXIS 22321 (11th Circuit 11/25/14), Mr. Witt was denied benefits in 1997 but did not contact MetLife to contest the denial until 12 years later. MetLife performed a courtesy review consisting of an administrative review of documentation and evidence. MetLife ultimately upheld its earlier denial of 12 years before and in its final letter to Witt, noted that he had exhausted his administrative remedies under the plan and had the right to bring civil action under Section 502a or ERISA.

MetLife’s letter did not assert a time bar or statute of limitations defense, and MetLife never noted in its letters or interaction with Witt’s attorney that it would ever exert a statute of limitations as a defense to litigation. When Witt filed a lawsuit several years later, MetLife successfully dismissed the claim and the 11th Circuit upheld the District Court’s decision. The court reasoned that it was not necessary for MetLife to expressly state in writing that it was preserving its right to exert the statute of limitations as a defense.

MetLife was entitled to perform a “courtesy review” of the claim without thereafter binding it to a re-initiation of a statute of limitations. The court was concerned that if they require an insurer to expressly state that its reconsideration of a stale claim preserved its right to a statutory timeliness defense, “that outcome would prevent plan participants with meritorious though untimely claims from receiving a review and possibly benefits. At the same time, it would aid only those individuals who fail to file claim in a timely fashion and then have their subsequent claims denied on the merits”.

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In light of Robin Williams’ passing this year, mental health has returned to the headlines. As described in Arianna Huffington’s article “Robin Williams, Connectedness and the Need to End the Stigma Around Mental Illness,” Williams’ suicide was undoubtedly linked to his struggle with depression and anxiety. In fact, as Huffington reports, “90 percent of those who commit suicide suffer from a mental illness of some kind at the time of their death.” Of all mental disorders, depression is the most common: it inflicts one out of every twenty Americans. This public-health concern has received far too little attention and since the 1980s, government “spending for mental health, while increasing in raw terms, has still remained only 1 percent of the economy, even as overall health spending has risen from 10 percent of GDP to 17 percent by 2009.” This lack in spending is largely due to the stigma associated with mental-health issues.

Decades ago, disability insurers became aware that a high percentage of their policyholders became disabled by mental health conditions. Instead of lending a helping hand, they turned their back on this population, by incorporating coverage limits for disability caused or contributed to by a mental health condition. This sweeping limitation has been upheld on court challenges even involving the ADA. 42 U.S.C. § 12101 et seq; Fletcher v. Tufts University 2005 U.S. Dist. LEXIS 7237 (D. Mass. April 15, 2005)

Illnesses of the body that affect our physical health are far easier to objectify and more accepted within the disability landscape, tending to overshadow emotional health. Physical ailments are often related to or can lead to mental disorders. NBC reported that Robin Williams was battling symptoms of early Parkinson’s disease. The news source noted that in addition to the paralyzing affects on a patient’s body, Parkinson’s often leads to “depression and other disability.” This is well documented.