:: File Review Of Medical Evidence After MetLife v. Glenn – A New Preference For Treating Physician Opinions?
We conclude that a reviewing court must take into account the conflict and that this necessarily entails a more complex application of the abuse of discretion standard. Specifically, a modicum of evidence in the record supporting the administrator’s decision will not alone suffice in the face of such a conflict, since this more traditional application of the abuse of discretion standard allows no room for weighing the extent to which the administrator’s decision may have been motivated by improper considerations.
Montour v. Hartford Life & Accident Ins. Co.08-55803 (9th Cir.) (September 14, 2009)
The Ninth Circuit has aligned itself with the Sixth Circuit in its skepticism of file review of disability claim denials. Montour v. Hartford offers a checklist of factors for critical evaluation in judicial review of claims decisions by conflicted fiduciaries including a careful look at the decision to prefer the opinion of file reviewers over examining physicians.
The Facts
The Plaintiff was an employee of Conexant Systems, Inc. for approximately thirty-seven years. As such, he participated in his employer’s group long-term disability insurance plan. Hartford is both the insurer and the administrator of the Plan and the plan documents granted it discretionary authority “to interpret
Plan terms and to determine eligibility for benefits.
The Plaintiff took a medical leave of absence from his position as a telecommunications manager after developing symptoms of acute stress disorder. Hartford accepted Montour’s application for benefits under the Plan and began paying him disability benefits.
Subsequently, he consulted Dr. Kenneth Kengla, an orthopedic surgeon, about pain in his right knee and his lower back.
Dr. Kengla diagnosed Montour with degenerative changes in both regions and notified Hartford in September 2004 that Montour was at that time also suffering from physical disability that prevented him from returning to the labor force. In October 2004 Dr. Kengla performed arthroscopic surgery on Montour’s right knee. The subject of Montour’s back condition did not come up again during their consultations until April 2005. Subsequently, Montour consulted Dr. Kengla about his back pain during appointments in December 2005 and May 2006.
Dr. Kengla consistently maintained to Hartford that Montour remained physically disabled and unable to work in any job as a result of his back and knee impairments.
The Claim Denial
Beginning in 2005, Hartford undertook a program of review of the Plaintiff’s activities using two outside surveillance companies. Without sorting through all of the details, suffice it to say that Hartford devoted substantial resources to this project. Though the video was relatively short, the investigation included a four and a half hour interview of the Plaintiff by the investigators.
Hartford then turned to a nurse case manager who began querying the treating physicians, then to outside physicians for file review, a vocational rehabilitations specialist, and so on. Ultimately, benefits were denied and the case ended up in federal court where the district court upheld the claim denial.
Ninth Circuit Appeal
The Ninth Circuit went to some pains to distinguish the standard applied by the district court from the standard it deemed proper in the instance of a conflicted fiduciary. The district court’s opinion showed reliance on caselaw “in which there was apparently no evidence of a conflict of interest,” which “was incorrect.”
The Court stated that:
Commonly, however, the same entity that funds an ERISA benefits plan also evaluates claims, as is the case here. See Metro. Life Ins. Co. v. Glenn, 128 S. Ct. 2343, 2346, 2348 (2008) (“MetLife II”). Under these circumstances, the plan administrator faces a structural conflict of interest: since it is also the insurer, benefits are paid out of the administrator’s own pocket, so by denying benefits, the administrator retains money for itself. Application of the abuse of discretion standard therefore requires a more complex analysis. See Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 965 (9th Cir. 2006) (en banc) (“[T]he existence of a conflict of interest is relevant to how a court conducts abuse of discretion review.” (emphasis added)).
Simply construing the terms of the underlying plan and scanning the record for medical evidence supporting the plan administrator’s decision is not enough, because a reviewing court must take into account the administrator’s conflict of interest as a factor in the analysis. See MetLife II, 128 S. Ct. at 2346, 2348, 2350; Abatie, 458 F.3d at 968-69.
MetLife I & II
The Court made an interesting division of MetLife, treating the Sixth Circuit opinion distinctly from that of the Supreme Court opinon, denoting the first as MetLife I and the latter as MetLife II.
For example, in MetLife II the Supreme Court endorsed the approach taken by the Sixth Circuit, which weighed three factors, namely, the medical evidence, a contrary SSA disability determination, and the administrator’s inherent conflict of interest, an trator’s conflict of interest as a factor in the analysis. See MetLife II, 128 S. Ct. at 2346, 2348, 2350; Abatie, 458 F.3d at 968-69.d ultimately concluded that the administrator had abused its discretion in denying benefits to the claimant.
See Glenn v. MetLife, 461 F.3d 660, 666-74 (6th Cir. 2006) (“MetLife I”), aff’d by MetLife II, 128 S. Ct. at 2351-52 (finding “nothing improper in the way in which the [Sixth Circuit] conducted its review”).
Factor Analysis
The district court has acknowledged there were “signs of bias in Hartford’s determination” but failed to examine the role the conflict may have played in the decision or its weight. The Ninth Circuit then cited a litany of problems with the benefit denial.
A partial list includes:
- For example, in its letters to Plaintiff, Hartford overstates and overrelies on surveillance of Plaintiff.
- This observed activity was brief and consistent with Plaintiff ’s self-reported limitations.
- Hartford strung together a laundry list of discrete activities observed over the course of four days.
- Hartford’s statement were in places “ inconsistent with Hartford’s report on the in-home interview.”
- Hartford’s statements and queries to treating physicians “again strung together discrete activities observed in short bursts over several days”.
- Hartford’s file review overemphasized the surveillance and ignored other known facts.
- Hartford’s failed to present extrinsic evidence of any effort on its part to “assure accurate claims
assessment[,]” such as utilizing procedures to help ensure a neutral review process. - Hartford’s conducted a “pure paper” review in this case, that is, to hire doctors to review Montour’s files rather than to conduct an in-person medical evaluation of him which “raise[s] questions about the thoroughness and accuracy of the benefits determination[,]”
- Hartford’s failed “to grapple with the SSA’s contrary disability determination.”
- Hartford failed to advise Plaintiff that further documentation, such as the ALJ’s decision or the underlying administrative record, would facilitate Hartford’s review.
Note: The Ninth Circuit entered judgment for the Plaintiff rather than remand for further development of the record, stating:
We reverse the district court’s summary judgment in favor of Hartford and remand to the district court to enter summary judgment in favor of Montour and to order the reinstatement of long-term disability benefits in accordance with this opinion and the terms of the Plan. See Pannebecker, 542 F.3d at 1221 (“[W]hether the administrator abused its discretion because the decision was substantively arbitrary or capricious, or because it failed to comply with required procedures, benefits may still be reinstated if the claimant would have continued receiving benefits absent the administrator’s arbitrary
and capricious conduct.”).
Alignment With 6th Circuit - The Court clearly endorsed the 6th Circuit view on factor review as well as the 6th Circuit evaluation of file review as a factor in and of itself as bearing on the effect of a conflict:
Another factor is Hartford’s decision to conduct a “pure paper” review in this case, that is, to hire doctors to review Montour’s files rather than to conduct an in-person medical evaluation of him. While the Plan does not require a physical exam by a non-treating physician, in this case that choice
“raise[s] questions about the thoroughness and accuracy of the benefits determination[,]” Bennett v. Kemper Nat’l Servs., Inc., 514 F.3d 547, 554 (6th Cir. 2008) (quotation marks omitted), as it is not clear the Plan presented Dr. Brown and Dr. Sukhov “with all of the relevant evidence.” MetLife II, 128 S. Ct. at 2352.
File Review - I recently co-authored a law review article entitled “Weighing Medical Judgments: Explaining Evidentiary Preferences for Treating Physician Opinions in ERISA Cases after Black and Decker v. Nord” , 13 Michigan State Law School Journal of Medicine and Law 157 (2009) (galley copy available in the Scholarship forum on erisaboard.com).
In that article, it is observed that the Sixth Circuit’s view on the quality and quantity of the medical evidence favors treating physician opinions based upon superior forensic insight in appropriate cases. This opinion from the Ninth Circuit illustrates how file review may become a significant factor in judicial review of conflicted fiduciary decisions.
