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Lack of Training for Employees Can Lack of “Full and Fair Review” – D.Az.

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  • Lack of Training for Employees Can Lack of “Full and Fair Review” – D.Az.

    Attached hereto is an unpublished case out of the District of Arizona, Vaughan v. Reliance Standard Life Insurance Company. In this case, plaintiff seeks long-term disability benefits under an ERISA governed plan. Defendant denied plaintiff’s claim asserting that she is not disabled. Plaintiff appealed, exhausted administrative remedies, and filed suit. Plaintiff argues that she was denied a full and fair review, in part, because defendant did not adequately train its claim examiners regarding the law of ERISA. The opinion does not go into detail, however, plaintiff must have moved to lift the stay on discovery and been successful because plaintiff deposed two of defendants claims examiners. With regards to depositions, the court stated:

    Plaintiff first contends that Defendant failed to provide adequate ERISA training to its employees. For example, Drew Walters, Defendant’s Senior Benefits Analyst, testified at his deposition that Defendant provided him with no ERISA training and that he was unaware of his fiduciary responsibilities under ERISA. (Doc. 40, Ex. A - Dep. Of Drew Walters, Dec. 9, 2016, 27:25-28:2, 55:18-22.) Karen McGill, Defendant’s Manager of Quality Review, made similar statements concerning the sparsity of ERISA training and accountability for its appeals specialists. (See, e.g., Doc. 40, Ex. A – Dep. of Karen McGill, Dec. 9, 2016, 29:7-9, 34:7-19, 44:21-45:7.) Though the Court is troubled by the apparent laxity of Defendant’s training, Plaintiff cites no authority suggesting that ERISA mandates a specific level of training. The Court is similarly hard-pressed to find such a requirement. Nevertheless, the Court finds Defendant’s deficient ERISA training, together with their employees’ unawareness of their fiduciary duties, indicative of the lack of the full and fair review required by ERISA.
    Plaintiff also argued that defendant did not adequately consider the medical information that she provided. Defendants denial of plaintiff’s claim was based, in part, on the fact that there is inadequate objective evidence in the files for disability. Plaintiff argues that objective evidence is not a requirement under the plan and that defendant blatantly failed to consider her subjective complaints. The court agreed with plaintiff:

    Before the Court examines the propriety of Defendant’s evidentiary decisions, though, the first step is to determine what types of evidence Defendant agreed to consider. See Peterson v. Federal Express Corp. Long Term Disability Plan, No. CV-05- 1622-PHX-NVW, 2007 WL 1624644, at *26 (D. Ariz. June 4, 2007). Beyond requiring proof of Total Disability during the Elimination Period, the policy does not limit reliable evidence to objective medical findings. (See AR0001-33.) Indeed, it supplies no evidentiary threshold whatsoever, save for “proof of health acceptable to us” or “satisfactory proof of Total Disability to us.” (AR0016, 18.) Neither is enlightening.

    Defendant nevertheless maintains that requiring objective evidence was a reasonable interpretation. It was not. Plan administrators are not at liberty to write-in supplemental policy exclusions. Canseco v. S. Cal. Const. Laborers Trust, 93 F.3d 600, 608 (9th Cir. 1996) (“[P]ension plan trustees may not construe a plan so as to impose an additional requirement for eligibility that clashes with the terms of the plan.”). To the contrary, administrators abuse their discretion when they construe plan provisions “in a way that conflicts with the plain language of the plan.” Eley v. Boeing Co., 945 F.2d 276, 279 (9th Cir. 1991), abrogated on other grounds by Abatie, 458 F.3d at 973.

    The Ninth Circuit has not directly addressed the situation presented here.4 Meanwhile, the circuits that have appear unanimous in their refusal of administrators’ post hoc attempts to narrow the universe of evidence beyond the plain language of the plan. See, e.g., Rochow v. Life Ins. Co. of N. Am., 482 F.3d 860, 865-66 (6th Cir. 2007) (rejecting medical evidence requirement for plan merely calling for “satisfactory proof”); House v. Paul Revere Life Ins. Co., 241 F.3d 1045, 1048 (8th Cir. 2001) (refusing “objective medical evidence” requirement where plan terms were silent); Mitchell v. Eastman Kodak Co., 113 F.3d 433, 443 (3d Cir. 1997) (denying implied “clinical evidence” requirement), abrogated on other grounds by Metro Life Ins. Co. v. Glenn, 554 U.S. 105 (2008). Additionally, in other disability contexts, the Ninth Circuit has emphasized the importance of treating physicians’ subjective judgments in their medical evaluations. See Embrey v. Bowen, 849 F.2d 418, 422 (9th Cir. 1988) (“The subjective judgments of treating physicians are important, and properly play a role in their medical evaluations.”); Lester v. Chater, 81 F.3d 821, 832-33 (9th Cir. 1995) (requiring ALJ to “give weight not only to the treating physician's clinical findings and interpretations of test results, but also to his subjective judgments.”).

    By refusing outright to consider any subjective evidence of Plaintiff’s conditions, Defendant not only added a new term to the plan, but also omitted, without justification, an important component of the opinions of Plaintiff’s treating physicians. As a result, Defendant hastily rejected—or perhaps ignored entirely5—Plaintiff’s evidence, including the expert opinions of Mr. Combs, Mr. Goldstein, Dr. Pace, Dr. Generaux, and Dr. Robb; the lay-witness affidavits of Plaintiff’s mother, son, and close friend; and even Plaintiff’s own complaints. Therefore, to the extent Defendant failed to consider this evidence pursuant to its improper objective medical evidence requirement, this Court finds that Defendant abused its discretion.
    A copy of the decision is attached.
    Attached Files