Gerhardt v. Liberty Life Assurance Company of Boston et al

Filing 133

OPINION AND ORDER re 119 MOTION for Judgment on the Record filed by Lisa Gerhardt, the Court finds that Liberty's decision to terminate Gerhardt's long-term disability benefits is AFFIRMED. Signed by Judge J. Leon Holmes on 8/14/12. (vjt)

IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF ARKANSAS
WESTERN DIVISION
LISA GERHARDT
v.

PLAINTIFF
No. 4:06CV01595 JLH

LIBERTY LIFE ASSURANCE COMPANY
OF BOSTON; UNIVERSAL HEALTH
SERVICES, INC.; UHS OF DELAWARE, INC.;
and BRIDGEWAY, INC.

DEFENDANTS

OPINION AND ORDER
Lisa Gerhardt commenced this action under the Employee Retirement Income Security Act
of 1974, 29 U.S.C. § 1001, et seq., against Liberty Life Assurance Company of Boston, Universal
Health Services, Inc., UHS of Delaware, Inc., and The Bridgeway, Inc. Gerhardt sought review of
an adverse disability benefits determination by Liberty, the Claims Administrator under the ERISA
plan sponsored by Universal Health. The Court found that substantial evidence supported Liberty’s
determination that Gerhardt’s “physical impairments alone did not prevent her from being able to
perform any occupation as defined by the policy and with the limitations indicated on” her transferable
skills analysis report. Document #55 at 20. However, the Court concluded “that Liberty failed to
properly address whether [Gerhardt] could perform the substantial duties of any occupation for which
she is reasonably fitted by mental capacity as required by the policy.” Id. at 21.
Consequently, the Court remanded the matter. Pursuant to the regulations concerning the
review of an adverse determination, see 29 C.F.R. § 2560.503-1(h), the Court directed Liberty to
“focus less on what Gerhardt’s condition was as of May 5, 2006, and more on what evidence
Gerhardt has brought forth during her appeal, taken in context with the prior record, and determine
whether that evidence satisfies the policy’s eligibility and proof of disability requirements and thereby

entitles Gerhardt to receive benefits under the plan.” Document #50 at 25. Furthermore, the Court
instructed Liberty to “consider all pertinent evidence relevant to Gerhardt’s physical ability to perform
the substantial duties of any occupation with reasonable continuity.” Id. The Court also instructed
Liberty to consider the effects of Gerhardt’s medications, age, and loss of RN license. Id. at 25-28.
After an unsuccessful appeal, Liberty began reviewing its prior benefits determination in
January of 2010.1 A.R. 2008. Liberty subsequently issued a letter ruling, dated August 30, 2010,
affirming its determination that the medical evidence no longer supported finding Gerhardt to be
disabled, within the meaning of the plan, in 2006. A.R. 1474-81. Gerhardt notified Liberty that she
wished to administratively appeal the ruling.

Liberty maintained that the applicable ERISA

regulations did not require an administrative appeal because the ruling was not an adverse
determination.

Nevertheless, Liberty ultimately relented and permitted Gerhardt to file an

administrative appeal. On February 8, 2011, Liberty issued a second letter ruling again finding that
Gerhardt was not disabled in 2006. A.R. 1363-70.
Upon Gerhardt’s motion, the Court reopened the instant action. Document #100. Gerhardt
has moved for judgment on the record, document #119, and the parties have filed their briefs. For
the following reasons, Liberty’s decision to terminate Gerhardt’s long-term disability benefits is
affirmed.
II.
In its prior opinion and order, document #55 at 1-17, the Court thoroughly discussed the
relevant facts contained in the record before remand. Therefore, only those facts added to the record

1

The defendants appealed the Court’s prior opinion and order, Document #61, but the Eighth
Circuit concluded that it lacked jurisdiction and dismissed the appeal, Documents #73, #74.
2

after remand will be narrated in detail herein. Suffice to say, Gerhardt was a licensed registered nurse
who performed a number of jobs in the medical industry from 1981 to 2000. She ceased working in
2000 because she was suffering from osteoarthritis in both hands and required bilateral basal joint
arthroplasty of both thumbs. She sought, and was granted, social security benefits from the Social
Security Administration. Similarly, she sought long-term disability benefits under the ERISA plan
sponsored by Universal Health. Liberty approved her application, and Gerhardt began receiving
benefits. Liberty continued to pay disability benefits to Gerhardt until May of 2006. Liberty then
ceased paying benefits to Gerhardt based on its determination that the medical evidence no longer
supported her claim that she was disabled under the plan.
A.

New Medical Evidence
In May of 2007, Dr. Marcia Hixon performed x-rays showing that Gerhardt had “moderately

severe osteoarthritis” in her right hand. A.R. 2346. In November of 2007, an MRI of Gerhardt’s
cervical spine revealed degenerative disc disease and uncovertebral osteophytes. A.R. 2791-92. Dr.
Amir Qureshi diagnosed Gerhardt with cervical myelopathy, severe cervical foraminal stenosis, and
cervical radiculopathy. A.R. 2793-94. Gerhardt notes that the findings of the MRI performed in
November of 2007 were consistent with a July of 2006 study finding “prominent degenerative disc
change[.]” A.R. 2868.
In September of 2008, Dr. Victor Vargas diagnosed Gerhardt with moderate to advanced
arthritis in her left hip requiring a total hip arthroplasty. A.R. 2895-96. Subsequently, in April of
2010, Dr. Scott Brown diagnosed Gerhardt with left hip osteoarthritis, and concluded that she
ultimately faced a hip replacement. A.R. 1599.

3

In June of 2010, Dr. Patricia Knott performed an independent medical evaluation on Gerhardt.
A.R. 1612-30. Dr. Knott concluded that, from May of 2006 to October of 2006, Gerhardt “should
be able to work at a full-time capacity” at the sedentary level with certain limitations. A.R. 1630.
Dr. Knott also concluded that Gerhardt’s capacity was probably greater than that reported in the
April of 2006 functional capacity report. A.R. 1621-22, 1628. Dr. Knott stated that Gerhardt should
be restricted to occasional sitting, standing, and walking in fifteen minute increments; occasional
driving; lifting and carrying no more than ten pounds; occasional pushing or pulling; seldom climbing;
no work at heights; occasional bending or twisting; no crouching, kneeling, or crawling; occasional
reaching and repetitive hand motions; and frequent fine finger manipulation. A.R. 1629-30. Dr.
Knott also stated that, if Gerhardt had hip surgery, then some of her restrictions could likely be
further relaxed. A.R. 1630. Dr. Knott observed that a number of Dr. Suphan’s diagnoses of
Gerhardt were unsupported by objective testing. A.R. 1614. About one month later, Dr. Knott
authored an addendum to her evaluation in which she stated that Gerhardt could not stand or walk
for more than fifteen minutes at a time and would need to sit for fifteen minutes between occasions
of standing or walking. A.R. 1582. In response to a question specifically addressing Gerhardt’s
cognitive limitations, Dr. Knott reiterated her conclusion that Gerhardt could have worked at a
sedentary level from May of 2006 until October of 2006.
In July of 2010, Margaret West diagnosed Gerhardt with “erosive moderate to severe
rheumatoid arthritis.” A.R. 1588. Dr. West prescribed Methotrexate Sodium and Plaquenil. Id.
That same month, Dr. Robert Cheek also diagnosed Gerhard with rheumatoid arthritis. A.R. 1503.
In October of 2010, Dr. Rachel Wayne observed evidence of rheumatoid arthritis, and adopted

4

Dr. West’s prescriptions. A.R. 1452. A bone density scan performed that month revealed that
Gerhardt’s bone density was below normal and worse than in 2000. A.R. 1447.
In October of 2010, Dr. Barry Baskin wrote an evaluation report discussing Gerhardt’s
medical condition. A.R. 1443-46. Dr. Baskin had previously authored an evaluation of Gerhardt in
2004. A.R. 685-93. In the 2010 report, Dr. Baskin stated that Gerhardt’s “medical diagnoses have
changed since [he] saw her originally in 2004 and her condition has deteriorated.” A.R. 1446.
Dr. Baskin concluded that Gerhardt would not be able to hold down even a part-time, sedentary
position because of her multiple diagnosis through 2010. Id. He observed, “[b]ased on my evaluation
today, I do not see any way that this lady could resume working, even at a sedentary level.” Id. Dr.
Baskin stated that his views were based on Gerhardt’s medical records and his in-person evaluation
of her on October 26, 2010. Id.
In January of 2011, Dr. Phillips Marion authored a peer-review report of Gerhardt’s medical
condition from March of 2006 to October of 2006. A.R. 1371-80. Dr. Marion concluded that
Gerhard suffered from “no objective neurological deficits” and that there were no “reported adverse
cognitive deficits as a result of [Gerhardt’s] prescribed medications.” A.R. 1378. Dr. Marion also
found that Gerhardt’s “objective impairments did not support the level of her self reported
occupational/functional incapacity.” A.R. 1380. Dr. Marion concluded that “[f]rom a physical
medicine and rehabilitation/pain management perspective, there remains no objective impairment
precluding Ms. Gerhardt from performing the full-time activities of a sedentary occupation[.]” Id.

5

B.

Evidence of Employability
In March of 2010, Sarah Moore, a certified rehabilitation counselor, authored an

employability assessment report on Gerhardt’s behalf. A.R. 2153-63. Moore concluded that
Gerhardt’s physical and cognitive limitations precluded her from performing any of the occupations
identified in the transferable skills reports created prior to the initial litigation. A.R. 2160-61.
Specifically, Moor found that the occupations of radio dispatcher, utilization review coordinator, and
case manager require more frequent reaching than Gerhardt could perform according to her functional
capacity evaluation. Additionally, Moore found that all the identified positions, except radio
dispatcher, required either a bachelor’s degree or RN license. A.R. 2161. Moore also found that
Gerhardt’s memory and concentration precluded her from performing semi-skilled work, and that the
only identified unskilled job that fell within Gerhardt’s capacity did not exist in sufficient numbers in
Arkansas or the United States. Id.
In August of 2010, Teresa Marques, a vocational rehabilitation, authored an updated
transferrable skills analysis report wherein she stated that Gerhardt, based on her medical condition
in 2006, could reasonably be expected to work in the sedentary occupations of Community
Health/Program Director, Nurse Case Manager, Utilization Review Nurse, Precertification Nurse,
Telephone Triage Nurse, Health Services Coordinator, and Ambulance/Emergency Service
Dispatcher. A.R. 1487-88.
In October of 2010, Moore authored a supplemental employability assessment report. A.R.
1414-19. Therein, Moore concluded that Gerhardt could not perform any of the occupations
identified in Marques’ report. Specifically, Moore found that the Nurse Case Manager, Utilization
Review Nurse, Precertification Nurse, Telephone Triage Nurse, and Ambulance/Emergency Service
6

Dispatcher positions required frequent reaching, while Gerhardt’s functional capacity evaluation
limited her to occasional reaching. A.R. 1417. Moore found that the Community Health/Program
Director position was too mentally and physically demanding for Gerhardt, and that the Health
Services Coordinator position constituted light rather than sedentary work. A.R. 1416-17. Moore
stated further that, if Gerhardt did find a position, she would likely eventually be terminated if she had
as few as one to two unscheduled absences every month. A.R. 1418. Moore reiterated her findings
regarding the need for a bachelor’s degree or RN license and noted that Gerhardt’s advanced age
would make it more difficult for her to adjust to different work from the jobs she had performed in
the past. Id.
In January of 2011, Marques authored another updated transferable skills analysis confirming
her previous findings. A.R. 1394-1400. Marques also stated that Moore’s findings were inaccurate
because they were based on the Dictionary of Occupational Titles which imposed outdated reaching
requirements that did not reflect the requirements of the identified occupations as they existed in
2006. Marques explained that the reaching requirements of these positions had changed based on
advances in technology such as the increased use of computers, development of ergonomic work
stations, and use of headsets. A.R. 1395-98. Additionally, Marques noted that Gerhardt held a
degree in nursing but no longer had an active RN license. A.R. 1398.
C.

Plan Terms
The Court extensively quoted the relevant plan provisions in its prior opinion and order. See

Document #55 at 2-4. These provisions need not be reiterated here. Suffice to say, the instant
dispute is whether, based on all relevant evidence, Liberty erred in finding that in 2006 Gerhardt was
no longer “unable to perform, with reasonable continuity, all of the material and substantial duties of
7

[her] own or any other occupation for which [she] is or becomes reasonably fitted by training,
education, experience, age and physical and mental capacity.” A.R. 823.
Benefits are determined on a monthly basis. A.R. 826. Pursuant to the plan, only a “Covered
Person” is entitled to disability benefits. A.R. 820, 823. A “Covered Person” is “an Employee
insured under this policy.” A.R. 823. An “Employee” is “a person in Active Employment with the
Sponsor.” A.R. 824. “Active Employment” means that “the Employee must be actively at work for
the Sponsor” and meet certain other conditions. A.R. 822. The “Sponsor” is “the entity to whom
the policy in issued.” A.R. 826. The Covered Person ceases to be insured when, inter alia, “the
Covered Person is no longer in an eligible class[.]” A.R. 842. The eligible classes are composed of
officers and employees of the Sponsor, “who are in active employment.” A.R. 820.
Disability benefits payable under the plan terminate when the recipient is no longer disabled.
A.R. 836. The plan provides that, where a covered person becomes disabled, then ceases to be
disabled, then becomes disabled again, the subsequent disability will be treated as part of the prior
disability provided that the covered person returns to work for the Sponsor for less than six
continuous months during the interim period when she ceased to be disabled. A.R. 838.
III.
“Where an ERISA plan gives the administrator discretionary power to construe ambiguous
terms or make eligibility determinations, the administrator’s decision is reviewed for an abuse of
discretion.” Hankins v. Standard Ins. Co., 677 F.3d 830, 834 (8th Cir. 2012) (citing King v.
Hartford Life & Accident Ins. Co., 414 F.3d 994, 998-99 (8th Cir. 2005) (en banc).
However, “when[, as here,] the entity that administers the plan ‘both determines whether an
employee is eligible for benefits and pays benefits out of its own pocket’ a conflict of interest exists.”
8

Chronister v. Unum Life Ins. Co. of Am., 563 F.3d 773, 775 (8th Cir. 2009) (quoting Metro. Life Ins.
Co. v. Glenn, 554 U.S. 105, 108, 128 S. Ct. 2343, 2346, 171 L. Ed. 2d 299 (2008)). Although the
presence of a conflict of interest does not alter the abuse of discretion standard of review, the Court
must “consider that conflict as a factor in determining whether the plan administrator has abused its
discretion in denying benefits.” Glenn, 554 U.S. at 108, 128 S. Ct. at 2346. “[T]he significance of
the factor will depend upon the circumstances of the particular case.” Id.
Even where the administrator is granted discretion by the plan, the Eighth Circuit has held that
a less deferential standard of review is warranted if a plaintiff can provide material, probative evidence
to demonstrate “that: (1) . . . a serious procedural irregularity existed, which (2) caused a serious
breach of the plan administrator’s fiduciary duty . . . .” Woo v. Deluxe Corp., 144 F.3d 1157, 1160
(8th Cir. 1998), abrogated on other grounds by Glenn, 554 U.S. 105, 128 S. Ct. 2343.2 Under the
Woo test, the “mere presence of a procedural irregularity is not enough to strip a plan administrator
of the deferential standard of review.” McGarrah v. Hartford Life Ins. Co., 234 F.3d 1026, 1031
(8th Cir. 2000), abrogated on other grounds by Glenn, 554 U.S. 105, 128 S. Ct. 2343. The
procedural irregularity must also raise “serious doubts as to whether the result reached was the
product of an arbitrary decision or the plan administrator’s whim.” Buttram v. Cent. States Se. & Sw.

2

Glenn abrogated the Woo test with respect to conflicts of interest. Glenn, 554 U.S. at 108,
128 S. Ct. at 2346. It remains to be seen, however, whether Glenn affected Woo’s holding that a
procedural irregularity may change the standard of review. Compare Wakkinen v. UNUM Life Ins.
Co. of Am., 531 F.3d 575, 581-82 (8th Cir. 2008) (explaining that, even under Glenn, the Eighth
Circuit continues to examine procedural irregularities under the two-part Woo test), with Chronister,
563 F.3d at 776-77 (analyzing procedural irregularities as factors under Glenn’s abuse of discretion
standard). See also Wrenn v. Principal Life Ins. Co., 636 F.3d 921, 924 n.6 (8th Cir. 2011)
(explicitly declining to decide whether Glenn changed the Woo procedural irregularity test, but noting
that Woo may still apply in the Eighth Circuit). This Court will continue to apply Woo to procedural
irregularities so long as that portion of Woo has not been overruled.
9

Areas Health & Welfare Fund, 76 F.3d 896, 900 (8th Cir. 1996). This second requirement is a
“considerable hurdle” for plaintiffs. Torres v. UNUM Life Ins. Co. of Am., 405 F.3d 670, 679 (8th
Cir. 2005) (quotation omitted). In Weidner v. Fed. Express Corp., the Eighth Circuit emphasized
that “procedural irregularities” are “the sorts of external factors that are sufficient under the common
law of trusts to call for application of a less deferential standard of review.” 492 F.3d 925, 928 (8th
Cir. 2007) (quotation omitted).
Gerhardt contends that Liberty committed serious procedural irregularities by failing to
consider information that it was required to consider under the relevant ERISA regulations, this
Court’s prior opinion and order, and the definition of “disability” in the plan. Specifically, Gerhardt
contends that Liberty (1) failed to consider Dr. Baskin’s finding that Gerhardt was disabled in 2010;
(2) failed to consider Dr. Bruce Safman’s original independent medical evaluation report; (3) relied
on transferable skills analysis reports that were inconsistent with Gerhardt’s functional capacity
report; (4) failed to consider Dr. Safman’s findings that Gerhardt lacked the mental capacity to
perform the jobs identified in the transferrable skills analysis reports; (5) failed to consider that
Gerhardt lost her nursing license and, consequently, was unable to perform most of the identified jobs;
(6) failed to consider that Gerhardt’s age changed from “approaching advanced age” to being “of
advanced age” when she turned 55 on November 16, 2008; (7) failed to consider the effects of
medications, which were prescribed to treat Gerhardt’s rheumatoid arthritis, upon her ability to work;
and (8) failed to consider evidence that Gerhardt was not able to perform “with reasonable
continuity” all material and substantial duties of the identified jobs.
Gerhardt’s third reason for imposing a less deferential standard of review is not “procedural”
in nature, but rather constitute a disagreement with the weight given to the evidence by Liberty. See
10

Weidner, 492 F.3d at 928-29; cf. Hankins v. Standard Ins. Co., 828 F. Supp. 2d 991, 1002 n.10
(E.D. Ark. 2011) (collecting examples of procedural irregularities) aff’d, 677 F.3d 830 (8th Cir.
2012); Bartholomew v. Unum Life Ins. Co. of Am., 588 F. Supp. 2d 1262, 1270 (W.D. Wash. 2008)
(“The evidence does not support the assertion that the plan administrator ‘disregarded’ Plaintiff’s
evidence, only that Plaintiff’s evidence was not considered sufficiently compelling to overturn the
conclusion of the medical experts utilized by Defendant as well as the weight of the other evidence.”).
Similarly, Gerhardt’s second, fourth, fifth, and eighth alleged procedural irregularities are
probably substantive disagreements rather than procedural errors. See Weidner, 492 F.3d at 928
(finding contention that lesser standard of review was warranted, based on claim that the
administrator failed to consider the opinion of the treating physician, to be “without merit because
[the argument] reflect[s a] substantive disagreement[] with the [administrator]’s analysis of the
administrative record, not procedural irregularities.”). However, the actual failure to consider
relevant medical evidence, as opposed to the mere rejection of such evidence as unpersuasive, may
be a procedural irregularity.3 Cf. Bartholomew, 588 F. Supp. 2d at 1270. The regulations provide
that a claims administrator must consider all relevant evidence. 29 C.F.R. § 2560.503-1(h)(2)(iv).
Furthermore, failure to comply with the ERISA regulations can constitute a serious procedural
irregularity. See McGarrah v. Hartford Life Ins. Co., 234 F.3d 1026, 1031 (8th Cir. 2000) (failure
to comply with regulations is a serious procedural irregularity); Abatie v. Alta Health & Life Ins. Co.,
458 F.3d 955 (9th Cir. 2006) (collecting cases noting that violations of ERISA’s requirements

3

Because, in Weidner, the claims administrator’s “denial letter stated that the Committee
‘reviewed all information presented including all medical documentation[,]’ ” it is unclear whether
that opinion stands for the proposition that an actual failure to consider relevant medical evidence is
merely a substantive, rather than procedural, disagreement. 492 F.3d at 929.
11

constitutes procedural irregularities); Hankins, 828 F. Supp. 2d at 1002-03 n.11 (indicating that a
procedural irregularity may exist where the insurer violates a duty imposed by the applicable
regulations). But see Brucks v. Coca-Cola Co., 391 F. Supp. 2d 1193, 1202 (N.D. Ga. 2005) (failure
to comply with 29 C. F. R. § 2560.503-1(h)(2)(iii) does not affect the standard of review).
Regardless, as in Weidner, there is evidence that Liberty did consider this medical evidence
after remand. Liberty notes, in its initial post-remand denial letter, that Gerhardt “requested that
Liberty consider the original 8/8/2005 IME report of Dr. Bruce Safman, and [] submitted a copy of
that report.” A.R. 1476. Similarly, the letter states that Liberty received Moore’s first report. A.R.
1476. Finally, the letter states that “[a]ll additional information received from [Gerhardt] was fully
considered in our review” and also provided to an independent physician for review. A.R. 1478-79.
Liberty’s second post-remand denial letter states that Liberty received Dr. Baskin’s report and
Moore’s second report. A.R. 1366. The second letter states that because “Liberty agreed to conduct
an appeal review of the remand determination and consider the additional information [] submitted,
Ms. Gerhardt’s complete claim file was referred to an” independent physician. Id. This medical
evidence constitutes the basis of Gerhardt’s second, fourth, fifth, and eighth alleged procedural
irregularities. Because Liberty’s post-remand determination letters indicate that all of this medical
evidence was considered, these alleged procedural errors do not merit the imposition of stricter
review. See Weidner, 492 F.3 at 929; Bartholomew, 588 F. Supp. 2d at 1270.
Even if any of these allegations constituted procedural irregularities, it is doubtful that
Gerhardt could establish the second element of the Woo test. See Torres , 405 F.3d at 679 (“We have
recognized that this requirement ‘presents a considerable hurdle’ for plaintiffs, . . . and we are aware
of only two cases that have satisfied the second part of the Woo test.”); see also Chronister v. Baptist
12

Health, 442 F.3d 648, 655 (8th Cir. 2006) (noting that, in order to strip a plan administrator of
deference, a procedural irregularity must be so egregious as to trigger a total lack of faith in the
integrity of the decision-making process).
Nor do Gerhardt’s first, sixth, and seventh allegations justify departing from the abuse of
discretion standard because Liberty did not err in declining to consider the evidence in question. The
underlying dispute respecting this evidence is whether Liberty was required to consider evidence
added to the record after remand only to the extent that evidence tends to establish that Gerhardt was
disabled in 2006, or also to the extent it tends to established that Gerhardt was disabled after 2006.
The Court remanded the case to Liberty for reconsideration of its finding that Gerhardt was
no longer disabled in 2006 rather than for a new determination as to whether Gerhardt was disabled
thereafter. Nevertheless, Liberty was still obligated to “[p]rovide for a review that takes into account
all comments, documents, records, and other information submitted by the claimant relating to the
claim, without regard to whether such information was submitted or considered in the initial benefit
determination.” 29 C.F.R. § 2560.503-1(h)(2)(iv). In considering whether Liberty should have
considered information generated after the remand, the pertinent inquiry is whether that information
was relevant to the claim. Gerhardt’s claim is for disability benefits under the plan. The nature of
the claim is determined by reference to the terms of the plan. Pursuant to the terms of the plan,
Gerhardt was only eligible for benefits so long as she was disabled. A.R. 823, 831. Thus, if Gerhardt
ceased to be disabled, she would no longer be eligible for benefits. A.R. 836-37. Furthermore, as
Liberty points out and Gerhardt does not deny, the plan provides that if a covered person ceases to
be disabled, that person must return to the employ of the sponsor or else she will cease to be covered
under the plan. A.R. 820-24, 826, 836, 842. In other words, if Gerhardt ceased to be disabled in
13

2006, she would not become eligible for benefits under the plan if she thereafter became disabled a
second time unless, in the interim, she returned to work for Bridgeway.
Because Gerhardt never returned to work at Bridgeway, her claim depends upon whether she
continued to be disabled. Liberty concedes that Gerhardt may have become disabled a second time
in 2010 or possibly earlier, so the only dispute is whether Gerhardt was disabled in 2006. Because
this is the determinative question, post-remand evidence is only relevant to the extent that it tends to
show whether Gerhardt was disabled in 2006. If the evidence does not tend to show that Gerhardt
was disabled in 2006, then no amount of evidence tending to establish that she was disabled in
subsequent years can save her claim. Cf. Jones v. Sullivan, 949 F.2d 57, 60 (2d Cir. 1991) (finding,
in social security context, that medical evidence is only material to a claim if it is “relevant to the
claimant’s condition during the time period for which benefits were denied[.]”); Bartholomew, 588
F. Supp. 2d at 1270 (same).
Gerhardt’s first basis for stricter review is that Liberty failed to consider Dr. Baskin’s finding
that Gerhardt was disabled in 2010. Dr. Baskin did not address her condition in 2006, which is the
relevant period for the current dispute, nor is it possible to infer from his report what Gerhardt’s
condition was in 2006. Consequently, Dr. Baskin’s report is not relevant to Gerhardt’s claim, and
Liberty’s refusal to consider this evidence does not require a more demanding standard of review.
Similarly, neither the fact that Gerhardt turned 55 in 2008, nor the evidence that she suffered
side effects from medications, Methotrexate and Plaquenil, prescribed to her for a condition for which
she was diagnosed in the middle of 2010, namely, rheumatoid arthritis, is relevant to whether
Gerhardt ceased to be disabled in 2006. Therefore, Liberty’s failure to consider this evidence does
not necessitate a less deferential review.
14

Nevertheless, as explained in the prior opinion and order, this Court will not rubberstamp a
decision to terminate benefits even under the deferential standard of review. Under the abuse of
discretion standard, the proper inquiry is whether Liberty’s decision was reasonable, that is, whether
it was supported by substantial evidence. Ortlieb v. United HealthCare Choice Plans, 387 F.3d 778,
781 (8th Cir. 2004). Substantial evidence is “more than a scintilla but less than a preponderance.”
Smith v. Unum Life Ins. Co. of Am., 305 F.3d 789, 794 (8th Cir. 2002). “It means such relevant
evidence as a reasonable mind might accept as adequate to support a conclusion.” Fletcher-Merrit
v. NorAm Energy Corp., 250 F.3d 1174, 1179 (8th Cir. 2001). An administrator’s decision is
reasonable if a reasonable person could have reached a similar decision, given the evidence in the
record, not whether the reasonable person would have reached that decision. Ferrari v. Teachers
Ins. & Annuity Ass’n, 278 F.3d 801, 807 (8th Cir. 2002).
In summary, the Court will consider whether Liberty abused its discretion in concluding that
Gerhardt ceased to be disabled under the plan in 2006. The Court will also consider Liberty’s conflict
of interest in determining whether Liberty abused its discretion.
IV.
Gerhardt contends that Liberty’s determination was unreasonable because Liberty failed to
consider medical evidence tending to establish that she was disabled. Gerhardt relies upon each of
the alleged failures which she also alleged constituted procedural errors.
As discussed above, Liberty did not err in refusing to consider Dr. Baskin’s 2010 report, the
fact that Gerhardt turned 55 in late 2008, and the effects of the medications prescribed for her
rheumatoid arthritis, because that evidence is not relevant to Gerhardt’s claim that she was entitled

15

to continued benefits by reason of disability in 2006.4 Therefore, Liberty did not abuse its discretion
in failing to consider that evidence.
A.

Dr. Safman’s Original Independent Medical Evaluation Report
Gerhardt contends that Liberty’s decision was unreasonable because Liberty did not consider

Dr. Bruce Safman’s original independent medical evaluation report. That report was prepared on
August 8, 2005. A.R. 2999-3001. In his report, Dr. Safman concluded: “I believe with fybromyalgia,
as severe as that which she appears to have, that there will be days when she could not participate in
sedentary activities, and there were other days when she could.” A.R. 3001. Gerhardt contends that
this statement supports her disability claim, and yet was not considered by Liberty. Rather, according
to Gerhardt, Liberty only considered an “edited” report which did not include the above language.
Liberty contends that Gerhardt’s acquisition of the original report was a violation of a Court
order and that the report should be disregarded. Regardless, as discussed above, the evidence
indicates that Liberty eventually did consider Dr. Safman’s original report. See A.R. 1476, 1478;
Bartholomew, 588 F. Supp. 2d at 1270.5

4

In her reply brief, Gerhardt clarifies that she does not argue that she was disabled by any of
the medications prescribed to her during 2006 but, rather, that Liberty erred in failing to consider the
side effects she experienced from the Methotrexate and Plaquenil prescribed in relation to her 2010
diagnosis of rheumatoid arthritis.
5

Below, the Court considers Gerhardt’s contention that Dr. Safman’s original report
undermines Liberty’s finding that Gerhardt could perform “with reasonable continuity” all of the
material and substantial duties of an occupation for which she was reasonably fitted.
16

B.

Transferable Skills Analysis Reports
Gerhardt contends that Liberty’s decision was unreasonable because Liberty relied on

Marques’ transferable skills analysis reports stating that Gerhardt could perform occupations
requiring frequent reaching even though Gerhardt’s functional capacity evaluation found that such
physical activity was beyond Gerhardt’s physical limitations. See A.R. 381-87. As noted, Moore
drafted two reports stating that Gerhardt could not perform most of the occupations identified in the
transferable skills analysis reports because they required a greater amount of reaching than permitted
by Gerhardt’s functional capacity evaluation. A.R. 1416-17, 2161.
However, in her updated report, Marques explained that Moore’s conclusions regarding the
amount of reaching these positions required were based on the Dictionary of Occupational Titles
which has not been updated since 1993. A.R. 1395. Marques further stated that the Dictionary was
outdated because advances in technology have changed the nature of the physical requirements of the
positions identified in the transferable skills analysis reports. Specifically, Marques explained that the
introduction of computers, ergonomic work stations, and headsets have reduced the frequency that
reaching is required in these positions. A.R. 1397-98. Marques remarked that her findings are
consistent with the newer Occupational Information Network, but noted that the O*Net “does not
provide specific strength information.” A.R. 1395.
Marques’ report provides substantial evidence for finding that the identified occupations do
not exceed Gerhardt’s physical limitations in the area of reaching. Cf. Hillier v. Soc. Sec. Admin.,
486 F.3d 359 (8th Cir. 2007) (substantial evidence supported finding that claimant could work as a
cashier, even if vocational expert’s [] testimony that claimant could perform such work was arguably
inconsistent with the Dictionary of Occupational Titles’ [] definition of the cashier job); Jones, 315
17

F.3d at 979 (concluding a claimant had the mental capacity to perform work, even though the work
exceeded the claimant’s skill level according to the Dictionary of Occupational Titles, based on the
claimant’s prior work history).6
C.

Mental Capacity
Gerhardt contends that Liberty’s decision was unreasonable because Liberty did not consider

medical evidence that Gerhardt lacked the mental capacity to perform the jobs identified in the
transferable skills analysis reports. Gerhardt relies upon Dr. Baskin’s 2004 report stating that
Gerhardt suffered from “chronic fatigue, concentration problems and some associated ADHD,” A.R.
690, and upon Dr. Safman’s 2005 report stating that Gerhardt’s “chronic fatigue and generalized
pain” would restrict her ability to participate in physical as well as cognitive activities, A.R. 3000.
As Gerhardt notes, the Court previously found that Liberty failed to have an analysis performed of
the mental demands of the identified positions. Document #55 at 24. Gerhardt contends that Liberty
again failed to provide for any such analysis after remand.
However, as Gerhardt concedes, Dr. Knott examined Gerhardt after remand and concluded
that Gerhardt appeared cognitively intact and did not have obvious limitations from her medications.
A.R. 1629. Liberty sought a clarification from Dr. Knott, and he responded by stating that Gerhardt’s
cognitive limitations would not have precluded her from working from May of 2006 to October of

6

Similarly, Gerhardt argues that she could not perform one of the occupations identified by
Marques, namely, Health Service Provider, because it required light rather than sedentary work. As
with the issue of reaching, the dispute turns on whether the O*NET reliably describes the
requirements of the position in view of technological and ergonomic advances over the past years.
The analysis and conclusion; namely, that Liberty’s decision is supported by substantial evidence,
would likely be the same. Nevertheless, the Court need not address this issue since it concerns only
one of occupations identified in Marques’ reports. Furthermore, as discussed below, this position
requires a bachelor’s degree or RN license, both of which Gerhardt lacked in 2006.
18

2006. Furthermore, Dr. Marion authored a peer-review report stating that, for the relevant 2006
period, there “were no objective neurological deficits, nor were there reported adverse cognitive
deficits as a result of [Gerhardt’s] prescribed medications.” A.R. 1378. Dr. Marion concluded that
Gerhardt’s objective impairments would not have precluded her from performing sedentary work in
2006. Id.
The opinions of Drs. Knott and Marion, even if they conflict with those of Drs. Baskin and
Safman, constitute substantial evidence supporting Liberty’s determination that Gerhardt’s mental
capacity did not preclude her from performing the identified occupations in 2006.7 See Smith, 305
F.3d at 794 (“When a conflict in medical opinions exists, the plan administrator does not abuse his
discretion by adopting one opinion, if reasonable, and finding that the employee is not disabled.”).
D.

Loss of Nurse’s License
Gerhardt contends that Liberty’s decision was unreasonable because Liberty did not consider

that Gerhardt lost her nursing license and, consequently, was unable to perform all but one of the jobs
identified by Liberty as within Gerhardt’s capabilities. Gerhardt points to Moore’s post-remand
report states that “[l]abor market research performed on 03/20/10 confirmed that either a bachelor’s
degree or RN license is required in all of the [identified] occupations except dispatcher.” A.R. 2161.
Liberty contends that its ruling was reasonable because, even if Moore’s research was correct,
Gerhardt could still perform one of the jobs identified. Furthermore, Marques’ report states that,
while Gerhardt no longer had an RN license, her past work experience and training support the
conclusion that she could perform sedentary occupations. A.R. 1398.
7

Gerhardt contends that the physicians’ reports neglect to consider the effect of the
medications she was prescribed in 2010. For the reasons discussed above, any mental limitations
resulting from these medications are irrelevant.
19

The plan provides that Gerhardt would no longer be disabled if, after receiving benefits for
twenty-four months, she were able to perform any other occupation for which she is reasonably fitted.
A.R. 823. Consequently, even if Gerhardt was only capable of performing one of the occupations
identified in Marques’ report, the Court cannot say that, pursuant to the plan’s terms, Liberty’s
determination that Gerhardt was no longer disabled in 2006 is unsupported by substantial evidence
in this regard. Cf. Hakes v. Astrue, 383 F. App’x 581, 583 (8th Cir. 2010) (per curiam) (no error in
holding that claimant was not disabled based on vocational expert’s testimony, even though the expert
identified only one occupation); Tommasetti v. Astrue, 533 F.3d 1035, 1043-44 (9th Cir. 2008)
(administrative law judge did not err in holding that social security claimant was not disabled even
though only one occupation to which claimant could adjust was identified).
E.

Reasonable Continuity
Finally, Gerhardt contends that Liberty’s decision was unreasonable because Liberty failed

to consider evidence that, even if Gerhardt was able to work most days, she was not able to perform
“with reasonable continuity” all material and substantial duties of the identified jobs. See A.R. 823.
Moore reported that Gerhardt would be unable to maintain employment if she regularly had one to
two unscheduled absences every month. A.R. 2162. Dr. Baskin observed that Gerhardt’s joint
complaints and fatigue related to her rheumatoid arthritis would prevent her from working a regular
schedule or even part-time work. A.R. 1446. Furthermore, Dr. Safman’s original report states that
“there will be days when [Gerhardt] could not participate in sedentary activities[.]” A.R. 3001.
As explained above, Dr. Baskin report is based on Gerhardt’s changed medical conditions,
including her 2010 diagnosis of rheumatoid arthritis, but does not address her condition in 2006. Dr.
Safman’s statement is somewhat ambiguous. It is not clear from his report how often Gerhardt could
20

be expected to encounter days when she could not participate in sedentary activities. Nevertheless,
Dr. Safman’s report does provide evidence for the proposition that, in 2006, Gerhardt may not have
been able to perform sedentary work with reasonable continuity.
Dr. Safman and Moore’s reports notwithstanding, there is substantial evidence tending to
show that in 2006 Gerhardt was able to work, with certain limitations, in a full-time position. As the
Court noted in its prior opinion and order, three doctors, Baskin, Safman, and Denver, and one
physical therapist, Grady, each separately concluded that Gerhardt could perform sedentary duties
on a full time basis. Document #55 at 21. Furthermore, Drs. Knott and Marion both concluded that,
with the limitations identified in the functional capacity evaluation, Gerhardt could work full-time in
a sedentary occupation. A.R. 1380, 1581-82, 1630. The Court cannot say that Liberty abused its
discretion in concluding that Gerhardt could perform sedentary work with reasonable continuity. See
Smith, 305 F.3d at 794.
CONCLUSION
On remand, Liberty considered not only Gerhardt’s physical impairments, but also whether
she had mental impairments, in addition to her physical impairments, that rendered her disabled in
2006. Liberty likewise addressed the side effects of Gerhardt’s medications, her age, and other
considerations. Contrary to Gerhardt’s arguments, Liberty complied with the Court’s remand order.
The evidence is in conflict. Although there is evidence to support Gerhardt’s contention that
she continued to be disabled in 2006, there also is substantial evidence to support Liberty’s finding
to the contrary. If the Court were to review de novo, Gerhardt might well prevail; but the Court’s
review is limited to determining whether Liberty abused its discretion. Because Liberty did not abuse
its discretion, Liberty’s decision to terminate Gerhardt’s long-term disability benefits is AFFIRMED.
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IT IS SO ORDERED this 14th day of August, 2012.

J. LEON HOLMES
UNITED STATES DISTRICT JUDGE

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