ERISA – Total Disability

ERISA lawyers know how tough these ERISA claims are. This is illustrated in a case from the Texas Southern District styled, Sarmiento v. Metropolitan Life Insurance Co.
Tammy Sarmiento sued for wrongful denial of benefits under ERISA, 29 U.S.C. 1332. The plan is through her employer, American Airlines. Her claim for long-term benefits was denied by the plan administrator. The Plan automatically ends long-term disability benefits (a) when the employee is no longer totally disabled as defined by the Plan and (b) after twenty-four months if the disability is for a mental-health disorder.
Tammy worked as a staff assistant. In August of 2011, she stopped working because she was having short-term memory loss. She was diagnosed with encephalopathy, major depression disorder, and frontal lobe syndrome. Under the Plan, encephalopathy is a physical condition. She applied for and received short-term and long-term benefits.
While on disability, she went to several doctors who prescribed medicine for her ailments, including steroids for the encephalopathy. Alterations in her medications caused her symptoms to vary. In 2013, three of her doctors, Hart, Flores, and Woon, determined that she had an essentially normal profile. An electroencephalography also showed normal results for her brains’ physical condition.
While the steroid treatments improved her brain’s conditions, they also might have caused her to develop her present obsessive-compulsive disorder. One of her doctors said that the disorder prevents her from being able to do the work she had done at American Airlines, while others said that they had no concerns from a cognitive standpoint with her intention to return to work.
In January 2014, the Plan terminated her long-term disability benefits and she appealed. She submitted a letter from Hart dated June 24, 2014, in which he represents that the worker’s obsessive-compulsive disorder is a residual deficit from her encephalopathy. He adds that it is extremely debilitating and precludes her from working in any job; however, he did not include new objective medical data to support his changed opinion. This is one of several of Hart’s inconsistent opinions. The claims processor determined that Hart’s letter did not substantiate the worker’s claim of total disability.
The Plan denied a second appeal because she is not totally disabled. It found (a) she no longer had a physical disability and (b) she had used the maximum amount of benefits for a mental disability.
To avoid abusing its discretion, the Plan’s decision must not be arbitrary or capricious.
The Plan abuses its discretion if its decision does not have a rational connection to the known facts. The Plan has the authority to interpret and construe its terms and conditions. It is not arbitrary or capricious to choose one doctor’s professional opinion over another. If the Plan’s decision is reasonable based on the administrative record, the reviewing court may not overrule it.
For the first 24 months of benefits under the Plan, an employee is totally disabled if she is not gainfully employed and is unable to perform the duties of her own occupation. After this, an employee is totally disabled only if she is unable to perform the major duties of any occupation for which she is reasonably qualified by training, education, and experience.
Long-term disability benefits automatically end when the worker no longer meets the Plan’s definition of total disability.
Tammy asserts that the Plan denied her benefits because it wrongfully classified her primary disability as a mental condition, and, therefore, she was only entitled to 24 months of benefits. Because her obsessive-compulsive disorder is a residual deficit from her brain encephalopathy – a physical condition – she insists that her current disability cannot be classified as mental.
Her condition is mental, not physical. If a worker were to develop insomnia as a result of taking medication that treated and cured an ulcer, the insomnia would be a mental condition despite the fact that it was created by a drug for the physical condition.
Ultimately, it does not matter whether it is a mental or physical condition; the Plan has determined that the worker does not meet the requisite definition of totally disabled either way. No current objective evidence suggests that the worker is presently suffering from a physical condition, let alone a physical condition that inhibits her from performing the major duties of any job for which she is reasonably qualified. Even if the administrative record showed that she had a disabling mental condition, her time has run for such benefits. She cannot be awarded benefits for either classification at this time.
The Plan did not abuse its discretion in denying Tammy continued benefits. The decision not to extend her benefits after reviewing the reports of her significant improvement and her normal electroencephalography was substantially supported by the administrative record and was well within the legal range of reasonableness required.
The Court stated that even though they may have reached a different decision, the Plan did not abuse its discretion because its decision was substantiated by an administrative record full of medical data.

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