Another ERISA decision
This one is from the Sixth Circuit, ruling in a case from Kentucky. The plaintiff was drawing long-term disability benefits, and the defendant insurer discontinued his benefits based on conclusions by the insurer's two separate "peer review boards" that he was capable of carrying out the duties of his previous position as Executive Vice President of Market Finders, his former employer. The Court ruled that the Sixth Circuit would adopt the "treating physician rule" used in other Circuits, under which the opinions of the plaintiff's treating physicians on this issue would be given deference by the court unless substantially outweighed by the insurer's contrary medical opinions. In essence, the court has stacked the deck in favor of coverage, and has increased the burden of proof on the part of the insurer to something higher than a preponderance of the evidence. Perhaps a "substantial preponderance" test is what the Court has in mind, although it has not disclosed the details of its thinking.
The inauspiciousness of this approach is well illustrated by the facts of this case themselves. The review panels did not accept the opinion of the treating physician that said, in part, that the claimant suffered from osteoarthritis because it was simply a bald statement, unsupported by any x-ray or laboratory testing to confirm it. The "treating physician" rule would lead many lower courts to simply accept such statements as valid medical opinions, without proper consideration of whether they are properly supported by the results of medical tests and diagnostic studies. Among other things, this approach flies in the face of the Daubert methodology demanded by the Federal courts.
The concurrence by Judge Siler noted that it was not necessary to announce such a rule in this case, and that the finding of all three of the judges on the panel that the insurer's decision was "arbitrary and capricious" under the ERISA standard permitted a finding for the plaintiff, even without adoption of the treating physician rule.
The ruling that Fortis's decision was arbitrary and capricious was based on its misapplication of policy language:
To qualify for continued LTD benefits, Darland has to satisfy the "Occupation Test," which states that the disability "prevents you from performing at least one of the material duties of your regular occupation." In this case, Fortis' decision to deny continued LTD benefits to Darland was based solely upon its determination that his disabling condition did not prevent him from performing all the material duties of his position as an Executive Vice President of Market Finders.
Darland v. Fortis Benefits Insurance Company, Sixth Circuit, 1-22-03
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