Hogan v. Life Insurance Company of North America
Filing
48
MEMORANDUM OPINION AND ORDER by Judge John G. Heyburn, II on 7/3/12; Plaintiffs claim for STD Plan benefits is DENIED and her claims are DISMISSED WITH PREJUDICE. This is a final order.cc:counsel (DAK)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
AT LOUISVILLE
CIVIL ACTION NO. 3:11CV-67-H
VIOLET M. HOGAN
PLAINTIFF
V.
LIFE INSURANCE COMPANY OF NORTH AMERICA
DEFENDANT
MEMORANDUM OPINION AND ORDER
Plaintiff, Violet Hogan, an employee of SHPS, Inc., appeals the administrative denial of
her Short Term Disability Plan (the “STD Plan”) benefits under the company’s employee benefit
plan. Defendant, Life Insurance Company of North America (“LINA”), was delegated authority
to adjudicate claims for STD Plan benefits. After the administrative denial of her claim, Plaintiff
filed this appeal. Both parties have moved for summary judgment based upon the administrative
record.
I.
First, the Court must resolve several preliminary issues. Plaintiff argues that the
employer has not properly delegated the right of discretionary review to its plan administrator,
LINA. This is a difficult argument to sustain based upon a review of the applicable documents.
However, both the STD Certificate and LTD Policy appear to give LINA the authority to
adjudicate claims for benefits:
The Plan Administrator has appointed the Insurance Company as
the named fiduciary for adjudicating claims for benefits under the
Plan, and for deciding any appeals of denied claims. The
Insurance Company shall have the authority, in its discretion, to
interpret the terms of the Plan, to decide questions of eligibility for
coverage or benefits under the Plan, and to make any related
findings of fact.
(Hogan 000122; Hogan 000152). The Court concludes that this language properly delegates to
LINA the authority to exercise the employer’s discretion to make all decisions related to benefit
claims. Based on the Administrative Record, and in addition to there being no objection from
the Plaintiff, the policy’s language gives LINA the power to make decisions on behalf of the
employer with regard to employee benefit claims.
Plaintiff also argues that the Plan documents do not sufficiently describe the discretionary
authority to review claims under the arbitrary and capricious standard. The STD Policy, STD
Group Disability Insurance Certificate (“STD Certificate”), and LTD Policy state as follows:
Disability Benefits
The Insurance Company will pay Disability Benefits if an
Employee becomes Disabled while covered under this Policy. The
Employee must satisfy the elimination Period, be under the
Appropriate Care of a Physician, and meet all the other terms and
conditions of the Policy. He or she must provide the Insurance
Company, at his or her own expense, satisfactory proof of
Disability before benefits will be paid.
(Hogan 000086 (STD Policy), 000112 (STD Certificate).
For quite some time the Sixth Circuit has found similar language to be a sufficient grant
of discretion. See, e.g., Perez v. Aetna Life Ins. Co., 150 F.3d 550, 556 (6th Cir. 1998) (granting
discretion where “the proof or evidence of disability... [is] satisfactory to the insurer or plan
administrator”); Miller v. Metro. Life Ins. Co., 88 F.2d 979, 983 (6th Cir. 1991) (granting
discretion based on the language “on the basis of medical evidence satisfactory to the Insurance
Company”).
II.
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The Court has carefully reviewed the medical evidence supporting Plaintiff’s claim. The
record is slim and the Court finds it unconvincing.
Apparently, Plaintiff filed her claim after she began to feel depression and anxiety.
Plaintiff’s first medical report was dated September 16, 2008, only two days prior to her last day
of work. At that time, her treating physician, Dr. Thomas Schurfranz, noted that she “can’t seem
to function” and “doesn’t like her job.” He diagnosed her as having “depression with anxiety”
and “back pain.” He saw Plaintiff on two other occasions shortly thereafter: September 22 and
October 27. His conclusions did not appear to change.
Under the STD Plan, Plaintiff is entitled to benefits if she is “unable to perform the
material duties” of her regular occupation. The Plan will not pay benefits if the injury or illness
is work related.
In reviewing all the doctor’s notes, the medical conclusions appear to be based entirely
on Plaintiff’s own self-reporting. Dr. Schurfranz’s diagnostic conclusions are general in nature.
The medical notes are devoid of any physical or mental tests results. No objective medical
findings support the doctor’s conclusions. He assigns no specific limitations based on any
particular diagnosis. Also, Dr. Schurfranz mentioned on several occasions that much of her
anxiety stemmed from work-related stress or work stressors.
Upon receiving and denying Plaintiff’s STD request, Defendant responded to Plaintiff
with specific reasons why the request was inadequate. It noted that the policy excludes claims
for work-related illnesses. This would seem to be a major cause of Plaintiff’s “depression with
anxiety.” Moreover, Defendant stated the remainder of her claims seem void of an explanation
for any claimed functional limitations. After receiving this critique of her claim, Plaintiff did not
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respond with any additional evidence addressing these deficiencies.
Defendant has many reasons to suspect this claim: (1) the general diagnostic conclusion,
(2) the complete absence of clinical tests and results, and (3) based upon only three office visits
without any subsequent follow-up visits. It is particularly suspect that Plaintiff initiated her
medical visits only two days prior to leaving work based on vague complaints. Moreover, Dr.
Schurfranz suggested referral to a psychiatrist for additional evaluation. Plaintiff never received
such an evaluation. Indeed, there are no medical records beyond October 27, 2008. In sum, the
complete absence of convincing medical evidence casts clear doubt on Plaintiff’s claim. The
Court concludes that Plaintiff’s medical evidence provides no sound or reasonable basis upon
which to identify a medical condition limiting her work. The decision to deny benefits,
therefore, was reasonable and was not arbitrary, capricious or an abuse of discretion.
Being otherwise sufficiently advised,
IT IS HEREBY ORDERED that Plaintiff’s claim for STD Plan benefits is DENIED and
her claims are DISMISSED WITH PREJUDICE.
This is a final order.
July 3, 2012
cc:
Counsel of Record
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