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Long-Term Disability Benefits Archives

Insurer's Recovery From Claimant of Benefit Overpayments May be Barred

Most long-term disability benefit policies provide that the insurance carrier may recover overpayments made to the claimant for disability benefits. Overpayments occur most frequently when the claimant receives SSDI back benefits that cover the time period during which the LTD carrier paid long-term disability benefits in full rather than reducing for the SSDI amount. As a result, the LTD carrier may seek to recover an offset for the amount of SSDI benefits.

XMRV Virus linked to Chronic Fatigue Syndrome May Help LTD Benefit Recovery

Our clients suffering from chronic fatigue syndrome and/or fibromyalgia will be interested to know that retro-virology researchers have found a virus that might be at the root of chronic fatigue syndrome. More than a million Americans suffer from the disease, which can leave them exhausted even after a good night's sleep, cause debilitating pain in muscles and joints, and make concentrating difficult. On NPR today, Dr. Daniel Peterson, one of the first to recognize chronic fatigue syndrome, explained the connection between CFS and the XMRV Virus. His interview is at the following link: http://www.npr.org/templates/player/mediaPlayer.html?action=1&t=1&islist=false&id=113650222&m=113650172

Cigna's Structural Conflict Will Now Be Scrutinized

An appeals court held this month that even though Cigna's plan administrator had discre-tion to decide questions of eligibility for long-term disability benefits, remand was appropriate to allow the district court to determine how heavily the administrator's structural conflict weighed in the abuse-of-discretion balance.In this case the claimant, "Edward," suffers from a number of degenerative conditions in his right foot, and especially in his great right toe. In 2003 he stopped working because of the severe pain that these conditions cause. Edward initially received long-term disability benefits under his employer's group benefit plan, which is insured by Cigna Life Insurance Company of New York. However, two years later Cigna determined that he no longer qualified for benefits because he could not meet the plan's requirement of showing that his disability prevented him from performing any job. Edward brought suit under the Employee Retirement Income security Act of 1974 ("ERISA"). The district court concluded that Cigna did not abuse its discretion in discontinuing Edward's benefits and granted Cigna summary judgment. The Court of Appeals however applied the Supreme Court's recent pronouncement in Metropolitan Life Insurance Company v. Glenn, advising courts to take cognizance of structural conflicts in ERISA cases.

District Court Shares The "Love" With Our Disabled Client

Our client, "Jim" received good news yesterday when the Court ordered Unum to fix its decision that had denied his long-term disability benefits. Our firm sued Unum when it refused to pay Jim's long term disability benefits under the policy it issued to Jim's employer, Trek Bicycle Corporation.

Liberty Mutual unlawfully failed to consider and discuss evidence of claimant's long-term disability

Last week the Court of Appeals found that Liberty Mutual failed to consider and discuss evidence of the claimant's ("Nancy") evidence of her long-term disability. Nancy worked for one employer for more than twenty years in a variety of positions including bank teller, teller supervisor, and technical-support analyst, before leaving due to health problems. After her physician diagnosed her with multiple sclerosis, Nancy applied for and received disability benefits through her employer's group Plan ("the Plan"). Three years after Nancy began receiving disability benefits, the Plan administrator terminated her benefits, stating that she no longer fit the Plan's definition of "disabled."

Prudential will now be confronted at trial with evidence of our client's disability

In a recent decision in favor of our client, the Court of Appeals remanded and instructed the district court that it "needs to know whether depression ever disabled [our client]. If the answer is no-either because his mental condition never was disabling, or because his physical impairments disabled him independent of his mental state-then the Plan's two-year bar does not apply, ruled the Court. If the answer is yes, and our client's mental condition played a causal role in his past inability to work, "it remains essential to know whether it remains important."

Prudential's doctors now subject to scrutiny

A nice surprise was waiting for me upon return from vacation this morning. Our client, "Paul", received a decision from the Seventh Circuit Court of Appeals in his favor. Paul enjoys disability insurance as a fringe benefit of his job. He stopped working in June 2002 because of a hernia and back pain. The hernia was repaired surgically, but Paul did not return to work. After a psychiatrist diagnosed Paul with dysthymia and major depression, Prudential started sending him long-term disability payments. But "long-term" means two years, the Plan's limit when inability to work is caused even in part by a mental illness (which the policy defines to include depression). At the end of January 2005 Prudential ended the disability benefits, citing the two-year cap. After exhausting his administrative remedies, we filed suit on Paul's behalf under the Employee Retirement Income Security Act (ERISA).

The Hartford violated ERISA by Failing to Identify Alternative Jobs For Claimant

Last month, The Hartford Life and Accident Insurance Group was found by the court to be arbitrary and capricious in its failure to conduct a proper vocational assessment of the claimant's ability to perform all occupations. Most long-term disability policies pay benefits for the first two years of the claimant's disability if the claimant is unable to perform her own job. After the first two years, the claimant must show, more broadly, an inability to work in any occupation for which she has the experience, training, or education.
In the present case, the claimant was approved and received benefits for several years "based on the conditions of Chronic Low Back Pain, Lumbar Facet Arthritis and spondylolisthesis." However, after she notified Hartford that she had taken in a foster child, it undertook a special investigation and conducted surveillance. She was videotaped on two different occasions at a fast food restaurant. On the first day, she was observed driving and getting in and out of the car. On the second day, she sat, without visible discomfort, for twenty-eight minutes at a table inside the restaurant. A Hartford representative showed the video to the claimant in her home. The claimant said the video "represented her normal/average level of functionality." The claimant stated her capabilities on her "best day" as including the ability to walk and stand for twenty minutes, to sit for thirty minutes, and to lift up to twenty pounds. Her statement claimed that she was having an "average" day and that she had two "best" days per week and one to two "bad" days per week.
Hartford sent the claimant to an independent medical examination (IME) which resulted in a report noting restrictions on the claimant's ability to work, including lifting 20 pounds, limitations on her ability to move, and a need to adjust positions periodically throughout the day. Hartford viewed these findings as allowing for full-time sedentary work as long as the claimant would have the ability to change positions and the job would not require prolonged standing or walking. This analysis was reported to the claimant's personal physician who refused to take a position on his patient's capacity to perform work and recommended a functional capacity evaluation, emphasizing that neither his own observations, nor those of the independent medical examiner, were "sufficient to make the needed determination!"
Despite these repeated recommendations from the claimant's doctor, Hartford refused to conduct a functional capacity evaluation. Instead, Hartford used the Occupational Access System (OASYS), a computerized job matching system based on the Dictionary of Occupational Titles by plugging in the claimant's education, experience, and the assumption that the claimant could work in sedentary jobs. The program returned four jobs that the claimant supposedly could perform.
The claimant hired her own vocational expert who determined that three of the four jobs Hartford found appropriate simply did not exist in the claimant's home state. The vocational expert also stated that all of these jobs would have a probationary period where no absences would be tolerated, followed by allowing at most one absence per month. Rather than identifying where the jobs exist, Hartford merely repeated the statement that the jobs were "prevalent in the national economy." The court held that, "Hartford should have responded to [the vocational expert's] report with the actual numbers and locations of these jobs." The court found this failure "particularly troubling" in view of other factors relevant to these three jobs, such as a sit-stand option and ability to miss days-- both of which needed to accommodate the claimant.
The court also found it significant that none of Hartford's reviewing experts specifically addressed the effect of the claimant's bad days. "Two consecutive 'normal' days are not particularly instructive on the claimant's ability to work on her bad days", said the court.
Finally, Hartford accepted the claimant's statements only when they confirmed the video surveillance and ignored her other statements. While the corroborating video surveillance was important, it was insufficient on its own to terminate benefits. It showed less than one hour of the claimant's life. Since the Plan failed to show the availability of three of the jobs and had not considered whether the claimant was sufficiently well to work the fourth job on a daily basis, the decision to terminate benefits was arbitrary and capricious, held the court. Accordingly, Hartford was ordered to reinstate long-term disability benefits retroactively to the date they were terminated.
This case emphasizes how crucial a strong vocational analysis is for the claimant to win her long-term disability benefits case.
Alan Olson writes this web-log to provide helpful information regarding long-term disability cases. He practices long-term disability law throughout the United States from his offices in New Berlin, Wisconsin. Attorney Olson may be contacted at [email protected] with questions about the information posted here or for advice on specific disability benefit claims. 

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