Young v. Aetna Life Insurance Company et al

Filing 30

District Judge Timothy S Hillman: MEMORANDUM OR DECISION AND ORDER entered denying 23 Motion to exclude documents from the record. (Castles, Martin)

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
____________________________________
)
SUSAN YOUNG,
)
)
Plaintiff,
)
)
CIVIL ACTION
v.
)
)
NO. 13-40154-TSH
AETNA LIFE INSURANCE COMPANY and )
CHILDREN’S HOSPITAL BOSTON GROUP )
LONG TERM DISABILITY PLAN,
)
)
Defendants.
)
___________________________
)
MEMORANDUM OF DECISION ON PLAINTIFF’S MOTION TO EXCLUDE
DOCUMENTS FROM THE RECORD (Docket No. 23)
February 27, 2015
HILLMAN, D.J.
This is an ERISA action in which Plaintiff Susan Young (“Plaintiff”) challenges the
Defendants’ termination of long-term disability benefits under the Children’s Hospital Boston
Group Long Term Disability Plan, an employee welfare benefit plan. Plaintiff has filed a motion
to exclude documents from the record (Docket No. 23). For the following reasons, the Plaintiff’s
motion is denied.
Background
Plaintiff was previously employed at Children’s Hospital in Boston. Through her
employment at Children’s, Plaintiff was covered by an ERISA welfare benefit plan underwritten
by Aetna Life Insurance Company. Defendant Aetna Life Insurance Company is the claims
administrator for the policy, and Children’s Hospital is the plan administrator.

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In September 2008, Plaintiff was involved in a car accident that caused severe injuries to
her shoulder, back, and hip. At the time of the accident, Plaintiff was working as an ICU Floor
nurse at Children’s Hospital, and the injuries left her unable to perform her job. She made a
claim under her welfare benefits policy for short-term disability benefits, which Aetna approved
for six months. As her condition did not improve over the six months, Plaintiff applied and was
initially approved for long-term disability benefits in March 2009. However, Aetna reviewed
Plaintiff’s claim in January 2012, and decided to terminate Plaintiff’s benefits on May 25, 2012.
Plaintiff appealed the determination through Aetna’s internal appeals process, but was
unsuccessful. This action was commenced on December 26, 2013. Plaintiff seeks judicial review
under 29 U.S.C. § 1132(e) of Defendants’ decision to terminate her long-term disability benefits.
Discussion
On August 13, 2014, Defendants filed their proposed record for judicial review (Docket
No. 17). Plaintiff seeks to exclude documents submitted by Defendants marked as “Young
Policy 000001 to 000062” (“Proposed Policy”), on the basis that they were not disclosed to
Plaintiff during the internal appeals process. 1 At issue is the fact that the Proposed Policy
contains language granting to Aetna “discretionary authority” to determine whether covered
employees are entitled to benefits under the plan. See Proposed Policy at 000062. 2 If a
discretionary authority provision is part of the plan, the Court must uphold Aetna’s decision

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Plaintiff’s motion also requests leave to amend the complaint to add claims against Aetna for penalties under 29
U.S.C. § 1132(A)(1)(a) & (c). See Docket No. 23. At oral argument, however, Plaintiff’s counsel represented that
she was waiving that request in light of intervening precedent. See Tetrault v. Reliance Standard Life Ins. Co., 769
F.3d 49 (1st Cir. 2014) (holding that the ERISA penalties provision does not allow for penalties against a claims
administrator).

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The provision states, in relevant part: “[Aetna] has complete authority to review all denied claims for benefits
under this policy. In exercising such fiduciary responsibility, Aetna shall have discretionary authority to: determine
whether and to what extent employees and beneficiaries are entitled to benefits; and construe any disputed or
doubtful terms of this policy. Aetna shall be deemed to have properly exercised such authority. It must not abuse its
discretion by acting arbitrarily and capriciously.” See Proposed Policy at 000062.

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“unless it is arbitrary, capricious, or an abuse of discretion.” Cusson v. Liberty Life Assur. Co. of
Boston, 592 F.3d 215, 224 (1st Cir. 2010) (internal quotations omitted). In the absence of such a
provision, “a denial of benefits . . . is to be reviewed under a de novo standard.” Firestone Tire &
Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S. Ct. 948 (1989).
During the internal appeals process Plaintiff repeatedly asked Aetna to provide her with a
full set of documents for the Children’s Hospital Boston Group Long Term Disability Plan, but
was never given a version containing the discretionary authority language. Now, at the eleventh
hour, the discretionary authority provision appears on the last page of the Proposed Policy
submitted by Defendants. Plaintiff argues that the late disclosure of the discretionary authority
language materially prejudices her position in this action, and therefore should be excluded.
For the same reason that Judge Woodlock did not impose a de novo standard of review in
McDonough v. Aetna Life Insurance Company, I decline to exclude the discretionary authority
provision. See 2014 WL 690319, CV No. 11-11167-DPW (D. Mass. Feb. 19, 2014). In
McDonough, the plaintiff argued that the court should review Aetna’s benefits determination de
novo because Aetna did not disclose a discretionary authority provision until well after the
litigation had commenced, even though the plaintiff had made repeated requests for a complete
copy of the plan. Id. at *11. However, the plaintiff in McDonough also acknowledged that the
benefits plan at issue did in fact contain the language reserving discretionary authority. Id.
Consequently, notwithstanding the belated disclosure by Aetna, Judge Woodlock “decline[d] to
impose de novo review where the plan unequivocally ma[de] such a reservation.” Id. at 12.
As in McDonough, the benefits plan at issue expressly contains a discretionary authority
provision. Plaintiff does not assert that Defendants have submitted an incorrect plan, but instead
argues that the late disclosure is so prejudicial that the discretionary authority language should be

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excluded. I disagree. To be sure, an insurer’s failure to provide beneficiaries with correct plan
documents after repeated requests is worthy of reproach. It is also troubling that Aetna appears to
be a repeat offender. As unseemly as the failure is, the fact that a plaintiff lacks notice of a plan’s
discretionary authority provision during the initial determination process is not so consequential
that it warrants exclusion from the record. Such a provision “is effectively addressed not to the
beneficiary, but only to a reviewing court that must act only after an application has been
denied.” Thurber v. Aetna Life Ins. Co., 712 F.3d 654, 660 (2d Cir. 2013). 3 Thus, as Judge
Woodlock observed, “the argument in favor of an actual notice requirement lacks the persuasive
value it might have if the provision at issue affected the beneficiary’s substantive rights under the
plan.” McDonough, 2014 WL 690319 at *12 (citing Thurber, 712 F.3d at 659-60). Accordingly,
I decline to exclude Aetna’s Proposed Policy.
In so doing, however, I note that a failure to provide beneficiaries with complete plan
documents during the initial determination and internal appeals process may reflect on the
insurer’s ability to engage in a reasoned and principled decision making process. Thus, the issue
may properly be taken into account as one of the “myriad of relevant factors” the Court considers
in determining whether the benefits denial amounted to an abuse of discretion. See Denmark v.
Liberty Life Assur. Co. of Boston, 566 F.3d 1, 9 (1st Cir. 2009) (citing Metropolitan Life Ins. Co.
v. Glenn, 554 U.S. 105, 115, 128 S.Ct. 2343 (2008)).

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I agree with the contention that, contrary to the Second Circuit’s assertion in Thurber, a beneficiary’s lack of notice
of a discretionary authority provision carries at least some consequence: “whether a particular plan contains a
discretionary reservation may well impact, among other things, a claimant’s ability to find counsel willing to take
his case.” McDonough, 2014 WL 690319 at *12 n.11. However, this consequence is not so substantial as to require
the provision’s exclusion.

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Conclusion
For the reasons set forth above, Plaintiff’s motion to exclude documents from the record
(Docket No. 23) is denied.

SO ORDERED.

/s/ Timothy S. Hillman
TIMOTHY S. HILLMAN
DISTRICT JUDGE

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