Disability Insurance Blog

Aetna Abuses its Discretion, Court Awards Back Benefits


Monday, March 4th, 2013

A Federal Judge reviewing the termination of a long term disability insurance claim has found that Aetna abused its discretion in its claim review, and has ordered that benefits be paid to the claimant. The long term disability claimant suffered from a condition which caused involuntary head movement and turning many years prior, and was treated for this condition. The condition returned in 2006, and despite treatment, he was unable to continue to work.

The condition, spasmodic torticollis, also known as cervical dystonia, impacted his ability to work as a baggage handler for Continental Airlines. Despite acknowledging that his occupation was a heavy physical demand level, Aetna’s medical review failed to find support for any limitations in functionality which would impair his ability to work in his occupation. Aetna’s claim representative disagreed with the medical review and recommended that the claim be paid.

Ultimately, Aetna agreed to liability for a period of time, while it continued to investigate the claim and pursue other claim investigative tools, including a Functional Capacity Evaluation (FCE). The results of the FCE were that the claimant was capable of “light” duty. The claimant also underwent an examination for his Social Security disability claim, which found him to have limitations in his functional ability and his SSDI claim was ultimately approved.

During the evaluation of whether the claimant was disabled from any occupation, Aetna obtained a paper review (rather than having the claimant examined), who found that the claimant had functionality. Aetna conducted a transferable skills analysis (TSA) which found him capable of performing certain jobs, and Aetna thus terminated the claim.

The Court, after evaluating Aetna’ s conflict of interest, and its handling of the claim, determined that there was a lack of substantial evidence to support that the long term disability insurance claimant could, in fact, perform a job that was able to provide an income of 80% of his adjusted pre-disability earnings.

Thus, benefits were reinstated to the claimant.

The issue of the any occupation analysis, with insurers conducting paper only medical reviews, coupled with TSA’s that are largely based upon the opinions of the paper reviewing doctors, is one commonly seen in our practice. If your claim is approaching the any occupation stage, it becomes the next logical point of attack for an insurer to seek to terminate your claim.

Mattson v. Aetna