After eight years, change of insurance companies leads to abrupt termination of benefits.

Pam C. (Aetna)

Pam was a Registered Nurse, employed by a large HMO. Her Long Term Disability benefits were approved by New York Life, after a thorough investigation. She was also approved for Social Security Disability benefits. After four years of her receiving LTD benefits, Aetna took over the insured group. Almost immediately, Aetna adopted a more aggressive case management posture, immediately ordering a private investigation of the claim by Miles Investigations. Aetna then sought production of all of Pam's tax returns over the previous four years. It then obtained an updated medical review by a "consultant", which was nothing more than a re-review of the existing medical records. The new "consultant" opined that Pam's claim was "essentially a self-reported claim" and that there had been no "objective test" to prove her condition. However, Aetna continued paying her LTD benefits for the next four years, while it monitored her status an obtained updated medical records on an ongoing basis.

Aetna ordered a second private investigation to be done, regarding Pam's employment status and daily activities. Then it ordered yet another paper medical review consultant, Dr. Cole, who opined that, "The medical records in file do not seem to support the claimant's reported level of disability . . . The diagnosis . . . does not appear to be well established." The Cole report was predictably followed by the Vocational Assessment by a consultant, Ms. Darman, who opined that Pam had transferable skills to perform a number of occupations based on the restrictions and limitations outlined by Dr. Cole. [See article: "The IME/TSA Swindle"]. This was followed by the inevitable LTD benefit denial letter, which drew upon new private investigation report, the Cole review and the Darman assessment. In no way was the denial based upon any determination by Aetna that Pam's disabling condition had changed or improved in any way since she first became eligible eight years earlier. Her benefits were abruptly terminated, even though there had been no change whatsoever in her physical condition.

Under the terms of her plan, the "appropriate named fiduciary" responsible for reviewing administrative appeals was the employer’s "Administrative Committee", not Aetna. The employer, however, took the position that Aetna was solely responsible for conducting all administrative reviews of denied claims.

I submitted an administrative appeal letter and supporting documents, which were directed to both the employer and Aetna. Aetna upheld the initial claim denial with a one and a half page letter, which ignored each and every issue raised by my appeal letter, as well as the narrative medical report and vocational assessment submitted with my appeal. The final denial letter recited an undisclosed paper review that was generated after my appeal by one of Aetna’s reviewing physicians. This was done in order to put evidence in the administrative record to rebut my appeal and to try to prop up the initial denial. The new Aetna-obtained report was contradicted by all of Pam's treating physicians. Even the Social Security Administration had found her to be disabled. Aetna's own predecessor, New York Life, had likewise agreed that she was disabled and that her condition had not changed in any way for many years.

At that point in the process it was pointed out that Aetna had violated the most basic, fundamental due process requirement of ERISA, specifically that of conducting a "full and fair" review. It was also pointed out that Aetna had engaged in several other procedural irregularities. This was followed by a rather lively exchange of correspondence and phone calls, the result of which was the case was ultimately resolved administratively, without the need for litigation. All benefit payments were resumed.

Michael A. McKuin

ERISA Disability Lawyer

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