Dunda v. Aetna Life Insurance Company

Filing 30

-CLERK TO FOLLOW UP-DECISION AND ORDER granting in part and denying in part 16 Plaintiff's Motion for Summary Judgment; and denying 20 Defendant's Motion for Summary Judgment. Specifically, Plaintiff's Motion 16 is granted to th e extent that Defendant is ordered to reinstate Plaintiffs monthly benefits and pay past due benefits; and Plaintiff's Motion 16 is denied without prejudice as to the request for interest and attorney's fees and costs. The Clerk of the Court is directed to close this case. Signed by Hon. Michael A. Telesca on 6/30/2016. (AFB)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK

RANDI DUNDA,

No. 6:15-cv-6232-MAT
Plaintiff,

DECISION AND ORDER

-vsAETNA LIFE INSURANCE COMPANY,
Defendant.

INTRODUCTION
Represented by counsel, Randi Dunda (“Dunda” or “Plaintiff”)
instituted

this

action

against

Aetna

Life

Insurance

Company

(“Aetna” or “Defendant”) pursuant to the Employee Retirement Income
Security Act of 1974, as amended, 29 U.S.C. § 1001, et seq.
(“ERISA”). Plaintiff challenges the termination of her long-term
disability (“LTD”) benefits by Aetna, and seeks declaratory relief
and attorney’s fees.
BACKGROUND
In 2007, Plaintiff was employed by Wawa, Inc. (“Wawa”) as a
General

Manager

at

one

of

their

stores.

Plaintiff

was

a

participatnt in the Wawa-sponsored the LTD plan (“the Plan”), which
is governed by ERISA.
The Plan is insured under a group policy of insurance issued
by Defendant, who is the claims fiduciary of the Plan and has
discretionary authority to (1) “determine whether and to what
-1-

extent employees and beneficiaries are entitled to benefits;” and
(2) “construe any disputed or doubtful terms of this policy.”
(AR.60).1 The Plan sets out the following “test of disability” for
the receipt of LTD benefits:
From the date that you first become disabled and until
Monthly Benefits are payable for 24 months, you will be
deemed to be disabled on any day if:
• you are not able to perform the material duties
of your own occupation solely because of: disease
or injury; and
• your work earnings are 80% or less
adjusted predisability earnings.

of

your

After the first 24 months that any Monthly Benefit is
payable during a period of disability, you will be deemed
to be disabled on any day if you are not able to work at
any reasonable occupation solely because of:
• disease; or
• injury.
(AR.4)

(emphases

supplied).

The

Plan

defines

“reasonable

occupation” as “any gainful activity for which you are; or may
reasonably become; fitted by: education; training; or experience;
and which results in; or can be expected to result in; an income of
more than 80% of your adjusted predisability earnings.” (AR.15)
(emphases omitted). According to the Plan, a “period of disability
ends on the first to occur of” several events, including “[t]he
date [Aetna] finds you are no longer disabled or the date you fail
1

Citations to “(AR. )” refer to pages in the Administrative Record, prepared
by Aetna and Bates-numbered “Dunda 00001-01223.” The Court has omitted the
placeholder zeros from its citations.

-2-

to furnish proof that you are disabled;” or “[t]he date your
condition would permit you to work, or increase the number of hours
you work, or the number or type of duties you perform in your own
occupation, but you refuse to do so.” (AR.5).
The Plan provides that “other income” benefits, such as
benefits under the Social Security Act (“SSA”), reduce the monthly
LTD benefits paid pursuant to the Plan. (AR.6-7). In particular,
the Plan provides that if payments are made in amounts greater than
the benefits that a claimant is entitled to receive, “Aetna has the
right

to

require

the

claimant

to

return

the

overpayment

on

request[.]” (AR.12). If the overpayment occurs as a result of the
claimant’s “receipt of other income benefits for the same period in
which [the claimant] ha[s] received a benefit under this Plan;” and
“to obtain such other income benefits, advocate or legal fees were
incurred[,]” Aetna “will exclude from the amount to be recovered,
such advocate or legal fees; provided [the claimant] return[s] the
overpayment to Aetna within 30 days of Aetna’s written request for
the overpayment.” (AR.12).
On August 30, 2007, Plaintiff commenced a disability-related
leave

from

her

employment

and

received

short-term

disability

(“STD”) benefits. Her diagnoses were lumbar herniated nucleus
pulposus,2 low back pain, and a herniated disc at L5-Sl.

When the

2

“Herniated nucleus pulposus is prolapse of an intervertebral disk through
a tear in the surrounding annulus fibrosus. The tear causes pain; when the disk
impinges on an adjacent nerve root, a segmental radiculopathy with paresthesias

-3-

period of Plaintiff’s eligibility for STD benefits was nearing an
end, Defendant began investigating whether Plaintiff qualified for
LTD benefits under the Plan’s “own occupation” test of disability.
On April 15, 2008, Defendant’s internal claims reviewer concluded
that Plaintiff
has been refractory to all [conservative treatment]
methods to date. . . . . Prognosis for full recovery
remains good, although the longer the complaints
continue, the more likely it will result in more
aggressive treatment and residual impairment.
(AR.384). Aetna accordingly awarded LTD benefits to Plaintiff under
the Plan’s “own occupation” test of disability, effective February
29, 2008. (AR.617-18).
On November 12, 2008, Defendant informed Plaintiff that she
“may be eligible for Social Security disability benefits,” and that
it “believe[d] a Social Security Application on [her] behalf [was]
warranted.” (AR.643). Defendant stated that it was making available
to her the services of Allsup, Inc., a nationwide disability
representation company, to assist her in applying for Social
Security disability

insurance

(“SSDI”)

benefits.

(AR.643).

On

August 14, 2010, the SSA issued a notice of award of benefits to
Plaintiff, retroactively payable from February 29, 2008. (AR.1147-

and weakness in the distribution of the affected root results. . . . Patients
with progressive or severe neurologic deficits, intractable pain, or sphincter
dysfunction may require immediate or elective surgery[.]” Michael Rubin, MDCM,
Herniated Nucleus Pulposus, Merck Manual –
Professional Version, avail. at
http://www.merckmanuals.com/professional/neurologic-disorders/peripheral-nervo
us-system-and-motor-unit-disorders/herniated-nucleus-pulposus (last accessed Apr.
19, 2016).

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52).
Meanwhile, in anticipation of the “own occupation” period
ending on February 28, 2010, a nurse at Aetna reviewed Plaintiff’s
medical records and concluded, “It is reasonable that claimant
lacks work capacity at all levels at this time due to ongoing pain,
limited range of motion, and inability for prolonged sitting, [and]
standing. However, with ongoing therapy, there is [a] possibility
that [she] may recover some work capacity.” (AR.129). Accordingly,
Defendant approved Plaintiff for benefits under the “more strict
definition of disability[,]” (AR.617), i.e., the “any reasonable
occupation” test of disability. (AR.135-37).
On January 26, 2012, about two years after Plaintiff had begun
receiving benefits under the “any reasonable occupation” standard
on

February

26,

2010,

Defendant

conducted

an

occupational

assessment. As a result of this assessment, Aetna found that
Plaintiff “does appear to have” sedentary to light skills for
alternate occupations within the sedentary-light physical demand
level, with the potential to reach the reasonable wage criteria in
the Plan. (AR.194).
On November 7, 2013, Plaintiff’s primary care physician,
Rachel Conley, M.D., completed an Attending Physician Statement and
Capabilities and Limitations Worksheet. (AR.946-48). According to
Dr. Conley, Plaintiff was able to perform sedentary work activity
for at least 4 hours per day, and could frequently lift 1 to 5

-5-

pounds; occasionally lift 6 to 20 pounds; and frequently walk, sit,
stand, and reach above her shoulders. (AR.948). After Dr. Conley
left the practice in 2014, Plaintiff established care with Dr. Eric
Shives, who was part of the same practice. (AR.870-71).
On September 23, 2014, treating chiropractor Erica Callahan,
D.C., completed a report stating that Plaintiff could work 4 hours
per day at the sedentary level. (AR.937). Dr. Callahan’s assessment
was

“based

upon

subjective

report

of

patient

of

functional

abilities, objective findings, outcome assessments and previous
history of spinal surgery and fusion via surgery” and Plaintiff’s
Oswestry

Low

Back

Pain

Disability

Questionnaire3

scores

on

September 18, 2014. (AR.937).
During a September 22, 2014, telephone interview, Plaintiff
informed the Aetna representative that she was pursuing online
studies to become a wellness coach. After graduation, she planned
to work at her partner’s chiropractic office so that her work
schedule could be flexible, and she could sit, stand, and lie down
as needed. (AR.248).
On September 24, 2014, Plaintiff’s new primary care physician,
Dr. Shives, submitted a CLW form that she had dropped off at his
office for him to complete. In the CLW, Dr. Shives opined that

3

The Oswestry Low Back Pain Disability Questionnaire is a validated
questionnaire used by clinicians and researchers to quantify disability due to
low back pain. See
http://www.rehab.msu.edu/_files/_docs/Oswestry_Low_Back_Disability.pdf.

-6-

Plaintiff had full-time (8 hours per day) work capacity with
restrictions equivalent to seated/desk work (AR.939), which was
contrary to all of the reports issued in the past by Dr. Conley,
and also contrary

to

the

reports

issued

by

chiropractor

Dr.

Callahan.
On October 6, 2014, Kimberly Pease (“Nurse Pease”) at Aetna
conducted a clinical review and concluded that, “based on the
clinical

documentation

submitted

for

review,”

Plaintiff’s

“musculoskeletal condition appears to have stabilized and she has
regained sufficient functional capabilities for seated/desk work at
this time.” (AR.263).
On

October

22,

2014,

Aetna

requested

completion

of

a

transferable skills analysis/labor market survey (“TSA/LMS”) with
regard to sedentary occupations exceeding the reasonable hourly
wage of $26.28 that Plaintiff possibly could perform. (AR.266-67).
The following positions were identified in the TSA/LMS: Merchandise
Manager, Market Manager, and Hotel Services Sales Representative.
(AR.268-69, 1222-23).
By letter dated October 31, 2014, Aetna’s LTD Benefit Manager
Lindsay Cobb (“Cobb”) informed Plaintiff that her LTD benefits
would be terminated as of that date. (AR.791-93). Cobb cited Dr.
Shives’ office notes, his September 2014 report, and Dr. Callahan’s
chiropractic

records

indicating

that

Plaintiff

had

subjective

symptoms that fluctuate and that it was not clear if her worsening

-7-

symptoms were based on increased activities. (AR.792). Cobb also
noted that Plaintiff’s recent telephone interview indicated that
she had the ability to travel and engage in multiple activities on
a daily basis. (Id.). According to Cobb, Plaintiff’s “family
medicine records do not provide quantifiable examination findings
to support an ongoing musculoskeletal impairment; cardiac issues
were ruled out via diagnostic workup; subjective reports of chest
pain

appear

to

be

anxiety

resolved.” (AR.792). Cobb

related,

which

is

now

considered

“considered [Plaintiff] capable of

sustaining at least sedentary work capacity,” which she defined as
“[l]ifting,

[c]arrying,

[p]ushing,

or

[p]ulling

10

lbs.

occasionally. Mostly sitting; may involve standing or walking for
brief periods of time.” (Id.). With regard to Plaintiff’s award of
SSDIB, Cobb noted, “[T]he information we have isn’t enough to show
that you aren’t able to work. . . . We don’t have the information
that was used to make your SSD benefit decision. We can only use
the information we have to make our decision.” (AR.792). Plaintiff
was informed of her right to appeal, and that Aetna would review
any additional information she submitted. (AR.793).
Plaintiff appealed, and submitted a supplementary letter dated
November 6, 2014. (AR.870-73). Plaintiff stated she was unable to
return to work because she cannot stand for more than 10 minutes at
a time, cannot sit for more than 30 to 45 minutes at a time, cannot
walk for more than 30 minutes at a time, cannot lift more than 10

-8-

pounds, cannot carry any amount of weight for any distance, and
must lie down for about 60 minutes at least once a day due to
continuous pain in her lower, middle, and upper back and her neck,
as well as left-side sciatica pain. (Id.).
Dr. Callahan submitted a letter dated November 5, 2014,
“recommend[ing] a complete prohibition of more strenuous activities
such as stooping, crawling, climbing, bending, and twisting.”
(AR.860). It was recommended that Plaintiff only work up to 4 hours
per day at a sedentary job, with the option to change positions
throughout the day “will help to prevent frequent aggravation of
neck and low back symptoms.” (AR.862). Dr. Callahan stated that
“[o]bjectively,

[Plaintiff]

presents

with

chronic

moderate

to

severe pain throughout her neck, back and legs” with “moderate to
severe restricted ranges of motion in the neck and lower back[,]”
especially in the lower back due to her previous spinal surgery.
(AR.862). Dr. Callahan then stated her “medical opinion is based
largely upon subjective reports,” as she did “not have the capacity
to have [Plaintiff] sit in [the] office, performing sedentary job
requirements for 4 hours [to] see how it affects her neck and lower
back.” (AR.862).
In a one-paragraph letter dated November 10, 2014, Dr. Shives
explained that the CLW he had submitted in September 2014, had
“mistakenly listed duration of condition as 4 weeks for her back
pain flare at that time.” (AR.865). Dr. Shives stated that he had

-9-

marked the “check box for 8 hours . . . in error,” and that it
“should have been checked as 4 hours as previously stated by Dr.
Conley from our office in Nov[ember] 2013.” (AR.865). Dr. Shives
noted that Plaintiff has chronic low back pain and degenerative
disk disease, and “her condition should be listed as lifelong.”
(AR.865). In a report also dated November 10, 2014, Dr. Shives
opined

that

Plaintiff

frequently

could

perform

the

following

activities: reach above the shoulder, forward reach, sit, stand,
walk, perform repetitive motions, and lift 1 to 5 pounds. (AR.856).
Plaintiff could occasionally lift 6 to 20 pounds and could perform
the following head and neck movements: static position, frequent
flexing, and frequent rotation. She also could operate a motor
vehicle, hazardous machinery, and power tools. Dr. Shives stated
that Plaintiff could work 4 hours per day. (AR.856).
After reviewing Dr. Callahan’s November 5, 2014, letter;
Plaintiff’s November 6, 2014, letter; and the November 10, 2014,
letter

and

report

from

Dr.

Shives,

Nurse

Pease

noted

the

discrepancy between these documents and Dr. Shives’ report from
September
“describes

2014.

Nurse

[an]

active

Pease

observed

lifestyle,

that

with

Plaintiff

modified

herself

exercise

and

frequent position changes” and “appears to have higher level
activity than the 11/10/14 CLW [from Dr. Shives] indicates.”
(AR.279).

Nurse

Pease

stated

that

was

“no

current

clinical

information with objective findings such as diagnostic studies or

-10-

documented impaired [range of motion] by degrees, antalgic gait or
symptoms/treatment

for

intractable

pain

which

would

preclude

claimant from full time work capacity.” (AR.279-82). Accordingly,
Aetna did not alter its determination that Plaintiff was not
disabled under the Plan.
Aetna then retained independent medical consultant Dr. Frank
Polanco, who performed a paper review of Plaintiff’s case but did
not conduct an IME. In a report dated December 23, 2014 (AR.82732), Dr. Polanco found that the medical documentation did not
support the limitations of a 4-hour work capacity at the sedentary
level. Dr. Polanco noted that “[a]s her physician has stated, his
restrictions are based on self[-]reports of functional capacity.
There are no clinical or diagnostic findings to support that the
claimant is incapacitated or limited to a sedentary 4 hour level of
physical capacity.” (AR.832). According to Dr. Polanco,
[w]hile the claimant has multiple pain complaints, there
are no findings on medical examinations or diagnostic
testing that are significantly functionally/physically
limiting. There are no findings that would restrict or
limit normal and routine activities such as walking,
standing, lifting, carrying, or use of upper and lower
extremities. The medical records reflect the claimant
retains functional mobility and strength and there are no
findings that would preclude full-time work within the
restrictions noted.4

4

According to Dr. Polanco, “[t]he restrictions supported are as follows:
Occasional lifting and carrying to 20 lbs., push/pull 45 lbs., occasional
kneeling and crawling. Occasional walking and standing limited to 30 minutes at
one time. Unrestricted sitting and use of upper and lower extremities. Ability
to alter positions as necessary.”

-11-

(AR.831-32).
By letter dated January 26, 2015, Senior LTD Appeals Manager
Charlai

J.

Lang

(“Lang”)

informed

Plaintiff

that

Aetna

was

upholding its decision to terminate her LTD benefits as of November
7,

2014.

(AR.812-14).

because

its

review

of

the

information

received and the results of Dr. Polanco’s report did not support
Plaintiff’s claim that she is unable to perform full-time work at
the

sedentary

level.

(AR.812-13).

Having

thus

exhausted

her

administrative remedies, Plaintiff timely commenced this action.
DISCUSSION
I.

Appropriate Standard of Review and the Existence of a Conflict
of Interest
“ERISA does not set out the applicable standard of review for

actions challenging benefit eligibility determinations.” Zuckerbrod
v. Phoenix Mut. Life Ins. Co., 78 F.3d 46, 49 (2d Cir. 1996). The
Supreme Court has held that “a denial of benefits challenged under
[ERISA] § 1132(a)(1)(B) is to be reviewed under a de novo standard
unless the benefit plan gives the administrator or fiduciary
discretionary authority to determine eligibility for benefits or to
construe the terms of the plan.” Firestone Tire and Rubber Co. v.
Bruch, 489 U.S. 101, 115 (1989).
Plaintiff and Defendant, after the summary judgment motion
originally

was

submitted,

jointly

sought

permission

to

file

supplemental briefing. See Plaintiff’s Supplemental Brief (Dkt
#27);

Defendant’s

Supplemental

Memorandum

-12-

of

Law

(Dkt

#28).

Plaintiff argues that review should be de novo, citing Halo v. Yale
Health Plan, Dir. of Benefits & Records Yale Univ., 819 F.3d 42,
57-58 (2d Cir. 2016) (holding that “when denying a claim for
benefits, a plan’s failure to comply with the Department of Labor’s
claims-procedure regulation, 29 C.F.R. § 2560.503–1, will result in
that claim being reviewed de novo in federal court, unless the plan
has otherwise established procedures in full conformity with the
regulation and can show that its failure to comply with the
claims-procedure regulation in the processing of a particular claim
was inadvertent and harmless”). Defendant questions whether Halo,
supra, is even applicable to the present case. The Court agrees
with

Defendant’s

reading

of

Halo—that

involves

a

plan

administrator’s noncompliance with federal regulations not at issue
here. And, as Defendant argues, Plaintiff has not demonstrated that
Halo should apply to her case.
Defendant also argues that Plaintiff should not be permitted
to escape its stipulation, in the Proposed Discovery Plan, filed
July 2, 2015, that “[t]he parties agree the governing standard of
review is abuse of discretion.” Dkt #11, p. 1. This Court is
effectively sitting as an appellate court, and therefore is “not
bound by stipulations as to questions of law.” Regula v. Delta
Family-Care Disability Survivorship Plan, 266 F.3d 1130, 1138 (9th
Cir. 2001) (citations omitted), abrogated on other grounds, Black
& Decker Disability Plan v. Nord, 538 U.S. 822 (2003). In the ERISA

-13-

context, courts

have

declined

to

treat as binding

a

party’s

stipulation to a particular standard of review. See id.; see also
Coleman v. Pikeville United Methodist Hosp., Inc., No. CIV.A.
05-32-EBA, 2008 WL 819038, at *3 (E.D. Ky. Mar. 25, 2008) (claimant
and administrator “jointly stipulated that the appropriate standard
of review for the Court to apply in this action is the arbitrary
and capricious standard” but the claimant subsequently argued, in
motion papers, that the instant action did not present a claim
under ERISA, and, alternatively, if the action is under ERISA, that
the appropriate standard of review is de novo; court considered, as
threshold issues, ERISA’s applicability to the instant action, and
if found to be applicable, the appropriate standard of review).
Accordingly, the Court will determine which standard of review
should apply.
Aetna, as “[t]he plan administrator[,] bears the burden of
proving that the deferential standard of review applies.” Fay v.
Oxford Health Plan, 287 F.3d 96, 103-04 (2d Cir. 2002)(citation
omitted). Here, the Plan, by its clear terms, gives Aetna authority
to

(1)

“determine

whether

and

to

what

extent

employees

and

beneficiaries are entitled to benefits;” and (2) “construe any
disputed or doubtful terms of this policy.” (AR.60). The Plan thus
“grants . . . [Aetna] complete discretion to make long-term benefit
eligibility decisions and to construe the terms of the plan.” Pagan
v. NYNEX Pension Plan, 52 F.3d 438, 441 (2d Cir. 1995).

-14-

Aetna’s

decision to deny Plaintiff LTD benefits “must be affirmed unless it
was arbitrary and capricious.” Id.
The fact that Aetna is operating under a conflict of interest
does

not

alter

the

Court’s

conclusion.

In

Metropolitan

Life

Insurance Company v. Glenn, 554 U.S. 105 (2008) (“Glenn”), “the
Supreme Court held that an ERISA-fund administrator that ‘both
evaluates

claims

conflicted,

and

for
that

benefits
a

and

district

pays
court,

benefits
when

claims’

reviewing

is
the

conflicted administrator’s decisions, should weigh the conflict as
a factor in its analysis.” Durakovic v. Bldg. Serv. 32 BJ Pension
Fund, 609 F.3d 133, 138 (2d Cir. 2010) (quotation omitted). While
employer-administrators

have

a

“categorical

conflict[,]”

id.,

“Glenn recognized that the dual-role conflict may arise with other
administrators as well, such as insurer -administrators[,]” id. at
138, because they “both decide[ ] who gets benefits and pay[ ] for
them.” Saffon v. Wells Fargo & Co. Long Term Disability Plan, 522
F.3d 863, 868 (9th Cir. 2008). The weight accorded to the conflict
“varies in direct proportion to the ‘likelihood that [the conflict]
affected the benefits decision[.]” Durakovic, 609 F.3d at 139.
Here, Aetna is operating under a dual-role conflict of interest,
since it both decides who receives benefits under the Plan, and
pays for those benefits. Thus, “it has a direct financial incentive
to deny claims.” Saffon, 522 F.3d at 868 (citation omitted). The
Court will consider this conflict in determining whether Aetna’s

-15-

determination

to

deny

benefits

was

arbitrary

and

capricious.

“‘[W]here the administrator imposes a standard not required by the
plan’s provisions, or interprets the plan in a manner inconsistent
with its plain words, its actions may well be found to be arbitrary
and capricious.’” Miles v. Principal Life Ins. Co., 720 F.3d 472,
486 (2d Cir. 2013) (quoting McCauley v. First Unum Life Ins. Co.,
551 F.3d 126, 133 (2d Cir. 2008); other quotation omitted)).
II.

Whether Aetna’s Determination Was Arbitrary and Capricious
A.

Aetna’s Requirement of Objective Evidence and Failure to
Fully Credit Plaintiff’s Subjective Complaints

Plaintiff alleges that Defendant failed to provide a full and
fair review of her claim by requiring “objective support for her
medical conditions,” even though (1) the Plan does not require such
proof, and (2) the Second Circuit has stated that subjective
complaints alone may constitute sufficient evidence of disability.
See Connors v. Conn. Gen. Life Ins. Co., 272 F.3d 127, 136 (2d Cir.
2001)

(“It

has

long

been

the

law

of

this

Circuit

that

the

subjective element of pain is an important factor to be considered
in determining disability.”) (internal quotation marks omitted).
Plaintiff is correct that under certain circumstances, a plan
administrator’s demand for objective evidence has been found to be
indicative of arbitrary and capricious decision-making. See, e.g.,
Tanner v. Nationwide Mut. Ins. Co., 804 F. Supp. 2d 601, 608 (S.D.
Ohio 2011) (“Arbitrary decisions may also include ones which accept
-16-

a file reviewer’s disregard of subjective reports of symptoms based
solely

on

objective

a

review

support

of

for

medical
the

records

claimant’s

which

do

not

contain

complaints[.]”)

(citing

Calvert v. Firstar Fin., Inc., 409 F.3d 286, 296 (6th Cir. 2005)).
In Tanner, for instance, the ERISA plan did not use the phrase
“objective medical evidence,” did not contain the word “objective,”
and did not include any other provision including such language, or
relating

the

phrase

“objective

medical

evidence”

to

what

constituted acceptable evidence of a disabling condition. Thus, the
the

phrasing

of

the

medical

consultant’s

conclusion

of

“not

disabled” “certainly raise[d] some question about whether he has
read a requirement into the [p]lan which is not there, and then
used that non-existent requirement as a basis for concluding that
[the claimant] does not meet the [p]lan’s definition of ‘long-term
disabled.’”

Tanner,

804

F.

Supp.

2d

at

613

(finding

that

administrator erred in “insist[ing] that the objective evidence be
sufficient to resolve all of the issues in the case, including the
amount of pain being experienced by the claimant”; “[i]f that were
a permissible interpretation of this plan, no claimant with a
condition which can cause disabling pain, but which sometimes does
not, could ever qualify for disability because the objective tests
rarely, if ever, precisely quantify the amount of pain which any
particular individual is suffering”) (citing Pelchat v. UNUM Life
Ins. Co. of Am., No. 3:02–cv–7282, 2003 WL 21105075, at *11 (N.D.

-17-

Ohio Mar. 25, 2003) (“The policy does not condition benefits on
clinical evidence of the existence of the condition that renders a
claimant disabled. To construe plaintiff’s policy to impose a
requirement of ‘objective medical evidence’ would rewrite the
policy.

As

courts

have

acknowledged,

‘an

administrator

lacks

discretion to rewrite the Plan.’”) (quoting Saffle v. Sierra
Pacific Power Co., 85 F.3d 455, 460 (9th Cir. 1996); citing
Mitchell v. Eastman Kodak Co., 113 F.3d 433, 443 (3d Cir. 1997)
(concluding it was arbitrary and capricious for an administrator to
require “objective medical evidence” to prove disability when
policy contained no such requirement); other citation omitted)).
Here,

as

in

Tanner,

the

Plan

does

not

use

the

phrase

“objective medical evidence,” did not contain the word “objective,”
and did not include any other provision including such language, or
relating

the

phrase

“objective

medical

evidence”

to

what

constituted acceptable evidence of a disabling condition. Indeed,
as Plaintiff argues, Aetna granted her LTD benefits under the more
stringent “any occupation” disability standard for over four years,
based on essentially the same medical evidence that, in October
2014, it discredited as “not objective” and therefore insufficient
to support a finding of disability. The Court is “not suggesting
that paying benefits operates forever as an estoppel so that an
insurer can never change its mind; but unless information available
to an insurer alters in some significant way, the previous payment

-18-

of benefits is a circumstance that must weigh against the propriety
of an insurer’s decision to discontinue those payments.” McOsker v.
Paul Revere Life Ins. Co., 279 F.3d 586, 589 (8th Cir. 2002);
see also Saffon, 522 F.3d at 871 (“[A]ssuming that the MRIs
document no ‘progression in degeneration,’ MetLife does not explain
why further degeneration is necessary to sustain a finding that
Saffon is disabled. After all, MetLife had been paying Saffon
long-term disability benefits for a year, which suggests that she
was already disabled. In order to find her no longer disabled, one
would expect the MRIs to show an improvement, not a lack of
degeneration.”). In the present case, the Court finds that the
previous payment of benefits to Plaintiff, without requiring a
showing of “objective medical evidence” suggests arbitrariness in
Aetna’s decision to discontinue those benefits. See id.
B.

Aetna’s Failure to Consider the SSA’s Disability Finding

Plaintiff argues that the SSA’s ruling awarding her disability
benefits was relevant to the determination of LTD benefits under
the Plan. Plaintiff further contends that Dr. Polanco, Aetna’s
medical consultant, erroneously failed to analyze or consider it,
though he

apparently

was

aware

of

that finding.

Indeed,

Dr.

Polanco’s report indicates that among the documents he reviewed
were those

dated

“07/07/11–8021090–08/14/10 [from

the]

Social

Security Administration.” (AR.828).
Although disability determinations by the SSA are not binding

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upon an ERISA plan administrator, they nevertheless are “‘relevant
and instructive’ in a [c]ourt’s determination of whether a plan
administrator acted arbitrarily and capriciously.” Adams v. Metro.
Life Ins. Co., 549 F. Supp. 2d 775, 788 (M.D. La. 2007) (quoting
White v. Airline Pilots Assoc., 364 F. Supp.2d 747, 767 (N.D. Ill.
2005);

other

citations

omitted).

Courts

have

found

SSA

determinations especially relevant when the plan administrator
“‘(1) encourages the applicant to apply for SSD payments; (2)
financially

benefits

from

the

applicant’s

receipt

of

Social

Security; and then (3) fails to explain why it is taking a position
different from the SSA on the question of disability[.]” Connor v.
Sedgwick Claims Mgmt. Servs., Inc., 796 F. Supp.2d 568, 585 (D.
N.J. 2011) (quotation and citations omitted). In such cases, “‘the
reviewing court should weigh this in favor of a finding that the
decision was arbitrary and capricious.’” Id. Here, as noted above,
Aetna encouraged Plaintiff to apply to the SSA for SSDI benefits.
In addition, Aetna made available the services of a disability
representation firm, Allsup, to assist her in pressing her claim
before the SSA. Then, once she was awarded disability benefits,
Allsup

collected

over

$37,071.10

in

overpaid

SSA

benefits.

Approximately $34,021 of that amount was returned to Aetna per the
terms

of

the

Plan.5

(AR.144-45,

149).

Furthermore,

Aetna’s

5

Allsup retained $3,050 in fees out of the $37,071.10 collected is past
benefits. (AR.149).

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financial obligation to Plaintiff was reduced due to her receipt of
SSDI beneifts.6 Aetna thus financially benefitted from Plaintiff’s
successful application to the SSA.
Aetna purported to explain why it took a position different
from the SSA on the question of disability when Lang wrote to
Plaintiff notifying her of Aetna’s decision to uphold the benefits
denial.

While

Lang

stated

that

she

recognized

Plaintiff

was

receiving SSDI benefits, she asserted that the information Aetna
had received was not “enough” to show that Plaintiff is unable to
work.

Lang

further

asserted

that

Aetna

did

not

receive

the

information used by the SSA to determine whether Plaintiff should
be

granted

SSDI

benefits.

It

is

difficult

to

credit

these

statements in light of the fact that Allsup routinely kept Aetna
apprised of developments in Plaintiff’s case before the SSA. As
noted above, Aetna’s medical consultant, Dr. Polanco, indicated in
his report that among the documents he reviewed were those dated
“07/07/11–8021090–08/14/10

[from

the]

Social

Security

Administration.” (AR.828). This contradicts Aetna’s assertion that
it did not have access to the information that the SSA used to
determine Plaintiff was disabled, which is, in any event, not
worthy of credence given that Aetna funded the litigation of
Plaintiff’s SSDI benefits claim. Despite stating that he reviewed
6

Beginning September 1, 2010, Plaintiff’s monthly LTD gross benefit amount
was reduced by the $1,235.00 she received each month in SSDI benefits. (AR.121819).

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the SSA records, Dr. Polanco did not mention, let alone address,
the SSA’s award of benefits to Plaintiff. The Court finds that all
of these factors strongly “suggest[ ] procedural unreasonableness,”
Glenn, 554 U.S. at 118 (remarking that the plan administrator’s
failure

to

address

the

SSA’s

award

of

benefits

“suggested

procedural unreasonableness” when the plan administrator encouraged
the claimant to seek SSD benefits).
C.

Aetna’s Failure
Examination

to

Order

an

Independent Medical

Aetna declined to order an in-person, independent medical
examination (“IME”), although the Plan provides that Aetna “will
have the right and opportunity to examine and evaluate any person
who is the basis of any claim . . . .” (AR.11). Plaintiff argues
that this constitutes a “violation” of Aetna’s “obligations under
ERISA,” because the failure to order an IME led to independent
consultant Dr. Polanco “necessarily ma[king] an adverse credibility
determination” against her, without the benefit of an in-person
examination. Pl’s Mem. (Dkt #17) at 12 (citing Smith v. Cont’l Cas.
Co., 450 F.3d 253, 263 (6th Cir. 2006)).
Courts

have

found

insurer-administrator’s

that

under

failure

to

certain
request

circumstances,
an

IME,

an

despite

authority to do so in the benefits plan, supports a finding that it
acted arbitrarily. See, e.g., Smith, 450 F.3d at 263-64 (finding
that where plan administrator had reserved the right to obtain IME
of claimant, decision by plan administrator to not require an
-22-

examination was considered as part of the arbitrary and capricious
review,

“especially

because

[the

medical

consultant]

made

credibility determinations concerning [the claimant]’s subjective
complaints”) (citing Calvert v. Firstar Fin., Inc., 409 F.3d 286,
292 (6th Cir. 2005)).
Here,

Aetna’s

internal

claims

reviewer

and

its

medical

consultant, Dr. Polanco, based their rejection of Plaintiff’s claim
solely on the absence of “objective findings” to corroborate her
complaints of intractable pain sufficient to preclude full-time
work capacity. For instance, in his report, Dr. Polanco discounted
all functional capacity limitations from her treating providers
because they were based on self-reports from Plaintiff and had not
been substantiated through clinical or diagnostic findings. It is
apparent that, in Aetna’s opinion, Plaintiff’s claim for LTD
benefits stood

or

fell

on

the

credibility

of

her

subjective

complaints. The Plan afforded Aetna the authority to require that
Plaintiff undergo an IME. Under these circumstances, the Court
finds

that

Aetna’s

decision

to

not

perform

this

examination

supports the finding that its determination was arbitrary and
capricious.
D.

Plaintiff’s Other Arguments

Plaintiff has raised a number of other arguments, including a
claim of judicial estoppel based on the favorable SSA decision, a
variation

of

the

“treating

physician”

-23-

rule

applicable

to

adjudicating claims before the SSA, and allegations that Dr.
Polanco is incompetent and biased in favor Aetna. Because the Court
has

already

found

sufficient

grounds

for

overturning

Aetna’s

decision, it need not address Plaintiff’s other arguments.
III. Remedy
Plaintiff requests reversal of Aetna’s decision and an order
directing that Aetna pay her LTD benefits through the remainder of
the “any occupation” period. Plaintiff also seeks an award of
attorney’s fees. Aetna urges that remand for further administrative
proceedings would be the proper remedy, should this Court determine
that its determination was arbitrary and capricious.
Where, as here, review is under the arbitrary-and-capricious
standard, district courts are required to limit their review to the
administrative

record.

“[I]t

follows

that,

if

upon

review

a

district court concludes that the [administrator’s] decision was
arbitrary and capricious, it must remand to the [administrator]
with instructions to consider additional evidence unless no new
evidence could produce a reasonable conclusion permitting denial of
the claim or remand would otherwise be a ‘useless formality.’”
Miller

v. United Welfare Fund, 72 F.3d 1066, 1071 (2d Cir. 1995)

(quoting Wardle v. Central States, Southeast & Southwest Areas
Pension Fund, 627 F.2d 820, 828 (7th Cir. 1980); further citation
omitted). At the time of Aetna’s final adverse decision, the record
in this case spanned 7 years and included a finding of disability

-24-

by the SSA. No reasonable argument can be made that record is
incomplete. The only “new” evidence that would be considered on
remand would be an IME of Plaintiff. However, Aetna had more than
ample opportunity to order an IME of Plaintiff, yet deliberately
declined to do so. Moreover, Aetna previously granted benefits to
Plaintiff based solely on its internal reviews of her medical
records, even under the more rigorous of the two definitions of
disability provided for in the Plan. It bears emphasizing that
Aetna based its previous favorable determinations on the same
medical evidence later found by Dr. Polanco to be insufficient to
establish Plaintiff’s disability. It is important to point out that
Dr. Polanco relied on the record only, without the benefit of a
personal examination of Plaintiff. Under these circumstances, the
Court finds

that

no new

evidence

could

produce

a

reasonable

conclusion permitting a non-arbitrary denial of the claim. Remand
would, in this case, be a useless formality.
CONCLUSION
For the foregoing reasons, Plaintiff’s Motion for Summary
Judgment (Dkt #16) is granted to the extent that

Defendant is

ordered to reinstate Plaintiff’s monthly benefits and pay past due
benefits. The Motion (Dkt #16) is denied without prejudice as to
the request for interest under New York Civil Practice Law and
Rules §§ 5001-5004 and attorney’s fees and costs. Defendant’s
Cross-Motion for Summary Judgment (Dkt #20) is denied.

-25-

SO ORDERED.
S/ Michael A. Telesca
HONORABLE MICHAEL A. TELESCA
United States District Judge
DATED:

June 30, 2016
Rochester, New York

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