A man was a participant in his employer’s disability plan. The plan provided that a participant qualified as disabled if, as a result of physical disease, injury, pregnancy, or mental disorder the employee was unable to perform with reasonable continuity the material duties of his or her own occupation and the employee suffered a loss of at least 20% of his or her indexed predisablity earnings when working in his or her own occupation. Participants could receive benefits until their reached age 65.
Under its Limited Conditions Provision, the plan limited long-term disability (LTD) benefits to 24 months for “a Disability caused or contributed to by ... :(1) Mental Disorders; (2) Substance Abuse; or (3) Other Limited Conditions.” The plan defined “Mental Disorders” to include “any mental, emotional, behavioral, psychological, personality, cognitive, mood or stress-related abnormality, disorder, disturbance, dysfunction or syndrome, regardless of cause ... or the presence of physical symptoms.” The plan defined “Other Limited Conditions” to include chronic fatigue conditions and chronic pain conditions, such as fibromyalgia. The plan provided two “Rules for Disabilities Subject to Limited Pay Periods”:
- If you are Disabled as a result of a Mental Disorder or any Physical Disease or Injury for which payment of LTD Benefits is subject to a limited pay period, and at the same time are Disabled as a result of a Physical Disease, Injury, or Pregnancy that is not subject to such limitation, LTD Benefits will be payable first for conditions that are subject to the limitation.
- No LTD Benefits will be payable after the end of the limited pay period, unless on that date you continue to be Disabled as a result of a Physical Disease, Injury, or Pregnancy for which payment of LTD Benefits is not limited.
The man began to experience symptoms including severe fatigue, intense back pain, and stomach irritation. His symptoms worsened as he developed a painful rash, began bruising and bleeding, suffered severe joint pain, and experienced cognitive issues, including trouble with reading comprehension, concentration, short term memory, directions, organization, and sense of time. His primary care physician could not determine the cause of the man’s symptoms and referred him to a hematologist-oncologist, who considered the possibility of Lyme disease. His primary care physician also referred him to a rheumatologist who concluded that the man's musculoskeletal symptoms were consistent with fibromyalgia, which overlaps significantly with mood and sleep disturbances. The rheumatologist also noted that the man had a history of obsessive compulsive disorder, which made it likely that unexplained physical symptoms with multiple physician evaluations would heighten the intensity of the symptoms. The rheumatologist recommended that the man’s treatment be primarily regulated by his psychiatrist.
A week after the evaluation by the rheumatologist, the man visited the psychiatric emergency department at a hospital and was admitted to the hospital’s outpatient program for two weeks. He reported his mental health history and his more recent somatic symptoms. He noted his recent diagnosis by the rheumatologist, and attributed his worsening depression to the idea that his doctors did not want to pursue his physical symptoms. At that time, his wife reported that he was “self-medicating” with prescription drugs. At discharge, he was diagnosed with major depressive disorder, obsessive compulsive disorder, and generalized anxiety disorder.
He had a follow up Lyme disease test which returned positive results for Lyme disease under the IGeneX IGG criteria, but negative results under CDC/NYS and Babesia FISH criteria.
He was then admitted to a hospital for substance abuse treatment. At the hospital, he reported that he had been abusing Vicodin, and explained that he had used a stolen credit card to buy things that he then sold to pay for drugs. His intake form noted his recent diagnosis of Lyme disease and his ongoing depression. He was discharged to the hospital’s residential treatment program. In an Ambulatory Services Initial Assessment, the man reported a longstanding history of obsessive compulsive disorder and episodic depression. His depressive symptoms were still significant and included suicidal ideation. He admitted to persistent and daily substance abuse over the last year. A doctor who evaluated the man during this time reported that many if not all of his physical and cognitive symptoms could be explained by chronic narcotic use and intermittent withdrawal symptoms. The man was discharged from the hospital’s residential treatment program about five weeks later.
The plan administrator approved the man’s claim for LTD benefits. At the time his claim was approved, a significant portion of the medical records in his file related to his psychiatric condition. The physician consultant who reviewed his file noted that he had a combination of chemical dependency and psychiatric disorder of life threatening proportions. The plan administrator concluded that the man’s claim supported that he had been unable to perform with reasonable continuity the material duties of his own occupation due to symptoms and treatment related to substance abuse and major depression.
The plan administrator warned the man that the plan limited payment of LTD benefits to 24 months during his entire lifetime for a disability caused or contributed to by mental disorders, substance abuse, or other limited conditions. The plan administrator explained that, because major depression was considered to be a mental disorder, it would apply the Limited Conditions Provision and terminate the man’s benefits after 24 months.
Over the following two years, the man was treated for Lyme disease in addition to substance abuse. A primary care physician conducted a spinal tap and found elevated levels of proteins which she interpreted as evidence of Lyme disease. A psychiatrist diagnosed the man with Lyme disease following a SPECT scan and a clinical evaluation. A neurologist ordered a second Western blot test which returned identical results to the earlier test—positive for Lyme disease under IGeneX criteria, but negative for Lyme disease under CDC/NYS criteria. Under the care of these three physicians the man received intravenous antibiotic treatment for Lyme disease.
Near the end of the two year period, the plan administrator informed the man that his LTD benefits would be terminated at the end of the 24–month limitation period. The plan administrator explained that because the plan limited payments for disability caused or contributed to by a mental disorder, in order to continue to receive LTD benefits, the man must be disabled by a physical disease or injury. Specifically, the administrator explained, the physical disease must be so severe as to cause disability in the absence of substance abuse, a mental disorder, or other limited condition.
The plan administrator had the man’s file reviewed by an independent physician consultant board-certified in internal medicine and rheumatology who specialized in Lyme disease. The consultant concluded that the man’s diagnosis of Lyme disease was speculative. The consultant discounted the positive Western blot results since, in his experience, the laboratory reported positive results that were not in agreement with clinical findings and often reported positive results in patients with no likelihood of exposure. The consultant also disagreed with the primary care physician’s reading of the spinal fluid analysis, noting that the sample had normal glucose, trivially elevated protein, and no inflammatory white or red blood cells counted. The consultant rejected the diagnosis of chronic Lyme disease because it was not supported by clinical and laboratory evidence and the man did not respond to month after month of multiple antibiotic therapies.
In its termination letter, the plan administrator stated that it could not conclude that a physical disease had been identified as defined by the policy. The plan administrator also stated that the consulting physician noted that the man may have been able to work had his psychiatric issued been appropriately dealt with. The plan administrator explained that it was unable to conclude that the man remained disabled as a result of a physical disease or injury and since LTB benefits payable for a disability caused by or contributed to by substance abuse, a mental disorder, or other limited conditions were limited to 24 months, the man’s LTD Benefits would be terminated.
The man exhausted his administrative appeals process. Subsequently he sued the plan administrator for unpaid benefits. The United States District Court for the District of Massachusetts entered summary judgment in favor of the plan administrator.
The First Circuit United States Court of Appeals affirmed. The court held that the plan's mental disorder limitation applied because, even though the man had been diagnosed with chronic Lyme disease, his mental disorders, regardless of their cause, contributed to his disability; the plan administrator's interpretation of the plan's mental disorder limitation and the rules governing the application of the plan's Limited Conditions Provision was not unreasonable; and the plan administrator would not be barred from relying on the plan's Limited Conditions Provision, as a mere post-hoc rationalization for its limitation of LTD benefits, as it had relied on the provision throughout the internal appeals process.
The plan's mental disorder limitation applied because, even though the man had been diagnosed with chronic Lyme disease, his mental disorders, regardless of their cause, contributed to his disability. The plan administrator's decision to limit the man's LTD benefits to 24 months based on the plan's mental disorder limitation was not arbitrary or capricious where, even if chronic Lyme disease was a valid diagnosis in general, and even if the man was disabled as a result of chronic Lyme disease, substantial evidence showed that his mental illness, whether or not related to chronic Lyme disease, contributed to his disability. Reports from the man's own treating physicians established that, at the relevant time, he had ongoing mental disabilities, in addition to his physical symptoms. The man himself highlighted the mental disorders with which he had struggled. The court noted that the plan’s mental disorder limitation was broadly written. It applied if a mental disorder, regardless of its cause, caused or contributed to a claimant’s disability. The man’s own evidence made clear that mental disorders, regardless of cause, continued to contribute to his disability. The court reasoned that the man’s own evidence was sufficient to trigger the mental disorder limitation.
The plan administrator's interpretation of the plan's mental disorder limitation and the rules governing the application of the plan's Limited Conditions Provision was not unreasonable. The reasonableness of the plan administrator's reading of the rules to mean that a claimant can receive benefits after two years only if the claimant continues to be disabled due to a physical disease separate from any limited condition was supported by other words in the plan. The plan’s general limitation included a statement that “[p]ayment of LTD benefits [was] limited to 24 months during [a participant's] entire lifetime for a Disability caused or contributed to by” mental disorders. The court reasoned that this statement did not compel the opposite conclusion that benefits will be paid after the limited pay period even if the claimant continues to suffer from a limited mental disability. The court found that the plan administrator's reading of this part of the plan was further supported by its consistency with another provision in the plan. This other provision of the plan explicitly specified that the Limited Conditions Provision, and the subsumed Mental Disability Limitation, would continue to apply when the period of disability was extended by a new cause while LTD benefits were payable.
The plan administrator would not be barred from relying on the plan's Limited Conditions Provision, as a mere post-hoc rationalization for its limitation of LTD benefits, as it had relied on the provision throughout the internal appeals process. The plan administrator relied on the plan’s Limited Conditions Provision in its initial termination letter and in communications with the claimant throughout the internal appeals process. The plan administrator's reliance on and interpretation of the Limited Conditions Provision took place before there was any litigation. The plan administrator did not raise the Limited Conditions Provision for the first time during litigation as a post-hoc rationalization for its termination of LTD benefits.
The First Circuit United States Court of Appeals affirmed the district court’s grant of summary judgment in favor of the plan administrator.
See: Dutkewych v. Standard Ins. Co., 2015 WL 1412590 (C.A.1 (Mass.), March 30, 2015) (not designated for publication).
See also Medical Law Perspectives, April 2014 Report: Danger and Controversy: Lyme Disease Liability Risks
See also Medical Law Perspectives, December 2014 Report: Beyond the Holiday Blues: When Depression Leads to Liability
See also Medical Law Perspectives, October 2014 Report: Backaches and Court Battles: When Chronic Back Pain Leads to Litigation
See also Medical Law Perspectives, January 2014 Report: Prescription Painkillers: Risks for Patients, Pharmacists, and Physicians
See also Medical Law Perspectives, June 2013 Report: Independent Medical Evaluations: Legal Risks and Responsibilities