Life Insurance Company of North America, a Cigna company that insures group disability plans, has lost a short term disability case in a Pennsylvania federal court. Cigna insures the disability plan for Quest Diagnostics, a national medical laboratory company. A Quest employee filed her disability claim after her adult son died. She was suffering from depression, anxiety, headaches and difficulty concentrating due to her grief, could not even drive a vehicle at times, and could not perform her job.
Despite submitting records from multiple medical providers, Cigna denied the employee’s claim. She appealed, submitting more records, and Cigna denied the claim again. The employee even attempted a second appeal, sending in even more medical records which supported her claim, and Cigna again denied her disability claim. She hired a new lawyer, and even tried a third appeal sending in more detailed records, all to no avail. Cigna once again denied her disability insurance claim.
Using one of its common tactics, Cigna had an in-house doctor review the records. The doctor wrote that the records did not support “the presence of a mental impairment of a severity sufficient to necessitate restriction from work.” Cigna’s doctor never even met with or examined the employee. Cigna’s doctor actually gave an opinion that the employee’s depression and anxiety was not significant just be reading records, despite the treating doctors explaining the severity of the condition in writing.
In reviewing the case, the court first addressed whether it had to give any deference to Cigna’s disability claim denial. Quest’s disability insurance plan, like other employee benefit plans, is governed by a federal employee benefits law called ERISA. ERISA is peculiar, because a group plan’s terms can give its insurer administrator discretion to make claim decisions. If the plan does that, a court is not allowed to overturn an insurer’s denial unless it determines not only that the disability insurer was wrong, but also that its decision was not supported by facts.
In this case, the judge decided that Cigna’s disability insurance policy did not afford discretion to Cigna. The plan simply stated that Cigna was “the named fiduciary for deciding claims for benefits under the Plan, and for deciding any appeals of denied claims.” The judge decided that this did not convey discretion upon Cigna. That is important, because without discretionary language, the judge was free to decide whether Quest’s employee was wrongly denied benefits, regardless of how much evidence supported Cigna’s decision.
The federal judge overruled Cigna after reviewing page after page of medical evidence. The judge also stressed several errors made by Cigna’s disability adjusters:
- Cigna made no attempt to even list the duties of the employees’s job. This was a problem, because Cigna had to determine if the claimant was able to “perform the material duties of her regular occupation,” yet Cigna had not even identified those duties.
- Cigna utterly ignored the opinion of one of the treating doctors, and did not explain why that doctor’s conclusions were not entitled to some weight. In the judge’s words, Cigna “failed to consider and justify the rejection” of the doctor’s opinion.
- Cigna relied upon “paper reviews” only. Cigna ignored three examining doctors to follow the opinion of an Appeal Senior Associate, a Nurse Case Manager, and its hired paper reviewing psychiatrist. The judge stated, “[W]here the insured’s treating physician’s disability opinion is unequivocal and based on a long term physician-patient relationship, reliance on a non-examining physician’s opinion premised on a records review alone is suspect and suggests that the insurer is looking for a reason to deny benefits.”
- Cigna cherry-picked evidence that supported its quest to deny benefits, yet ignored evidence in the records which supported disability. “Crediting one portion of a report and rejecting others is further evidence of arbitrary and capricious behavior.” “An administrator cannot selectively parse out information.”
The judge concluded that Cigna “repeatedly failed to fully and fairly consider the medical record as a whole; had [Cigna] done so, Plaintiff would have received benefits.” The decision reversed Cigna, and awarded disability benefits and attorney fees to the Quest employee.
Levine v. Life Insurance Company of North America, No. 14-7050, 2016 U.S. Dist LEXIS 53286 (E.D. Pa. April 21, 2016).