Tactics Insurers Use to Deny Valid Claims for Disability Benefits

Often times, disability insurers rely upon a common set of arguments and use common tactics to deny valid claims for disability insurance benefits. For instance, disability insurers will often have a claimant’s records analyzed by consulting physicians who challenge the opinions and diagnoses made by a claimant’s treating physicians, criticize the symptoms reported by claimants and demand objective evidence of complaints that are inherently subjective in nature, and cherry-pick portions of the record in order to downplay a claimant’s symptoms and claim that the available evidence does not support disability. Additionally, disability insurers will often deny claims for disability benefits after initially approving them without demonstrating any improvement in a claimant’s condition, and will also ignore determinations that an individual is disabled made by the Social Security Administration (“SSA”) and state disability agencies. A recent decision by a court in the Northern District of California addressed many of these arguments proffered by disability insurance providers and clarified that disability insurers cannot rely solely upon unsupported allegations.

In Gallegos v. The Prudential Insurance Company of America, 2017 WL 2418008, (N.D. Cal. June 5, 2017), Ms. Gallegos was diagnosed with lupus and was forced to stop working as a manager of a pharmaceutical company due to severe fatigue and headaches with eye pain and facial numbness. Ms. Gallegos’ neurologist determined that she suffered from chronic headaches that prevented her from working, and while her lupus directly manifested as headaches, she continued to have disabling migraine headaches which were distinct from her lupus induced headaches. Prudential approved Ms. Gallegos’ claim for short term disability benefits, and subsequently approved her claim for long-term disability benefits determining that based upon a clinical review, she was totally disabled from her occupation. However, after approximately two months, Prudential terminated her long-term disability benefits based upon a report prepared by its consulting physician who determined that Ms. Gallegos was not disabled because her fatigue had not resulted in any accidents, and her positive test for lupus could not explain the bulk of her symptoms.

Ms. Gallegos appealed Prudential’s decision to terminate her claim for disability benefits and included a functional capacity evaluation that found her range of motion to be far below normal, and she also included a vocational review that revealed she had significant typing limitations, discomfort, fatigue, and concentration difficulties. Prudential subsequently had two additional physicians review Ms. Gallegos’ records, and both determined that she was not disabled. One of the reviewing physicians did not believe Ms. Gallegos had lupus despite the diagnosis from her treating physician. While Prudential was reviewing Ms. Gallegos’ appeal, the SSA determined she was disabled and awarded her disability benefits. Prudential later denied Ms. Gallegos’ appeal of its decision to terminate her disability benefits, claiming her file did not support a diagnosis of lupus as there was no record of lupus anticoagulant in her blood, and noting that there was no documented neurological examination. Ms. Gallegos submitted a second appeal to Prudential providing lab results revealing lupus anticoagulant in her blood test and also including a report by an independent psychologist appointed by the SSA diagnosing her with Cognitive Disorder due to lupus. Prudential upheld its denial of Ms. Gallegos’ disability benefits, arguing the lupus anticoagulant did not establish disability and the records did not contain documentation of falls, coordination dysfunction, or use of assistive walking devices.

The District Court found that the medical file available to Prudential did indicate Ms. Gallegos was disabled. The Court noted that the prior approval of Ms. Gallegos’ disability benefits by Prudential constituted relevant evidence as to whether she was disabled. The Court expected Prudential to provide some evidence of a change in circumstances regarding Ms. Gallegos’ condition as its previous finding of disability weighed in favor of Ms. Gallegos. The Court criticized Prudential’s failure to consider Ms. Gallegos’ self-reported symptoms, noting that courts have rejected attempts to ignore self-reported symptoms. The Court also noted that there are certain syndromes, such as chronic fatigue syndrome and fibromyalgia, for which there are no specific diagnostic tests exist, and Prudential’s failure to specify what types of objective evidence it is looking for indicates that such objective evidence demonstrating Ms. Gallegos’ migraines and inability to concentrate might not exist. The Court similarly criticized Prudential’s failure to take Ms. Gallegos’ medication side-effects and work stress into account, since both of these factors contributed to her disability, and noted that the failure to consider the cumulative effect of these issues weighed against Prudential’s decision.

The Court ultimately determined the opinions of Ms. Gallegos’ treating physicians were probative and emphasized that Prudential ignored these opinions. The Court criticized the fact that Prudential directly contradicted Ms. Gallegos’ treating physicians without any adequate explanation of the reason for the contradiction. With regard to Ms. Gallegos’ award of benefits from the SSA, the Court noted that while the standards to be followed by the SSA differ from those of Prudential, the SSA’s decision indicates that Ms. Gallegos bears some restriction in her capability to work and, while not dispositive, it does help her show that she is disabled.

This is a strong decision for ERISA plan participants who are disabled due to diagnoses that rely heavily upon subjective complaints and do not have specific objective criteria for diagnosis. It is also an important decision for claimants who were previously receiving disability benefits and were then denied benefits without a change in their condition, claimants who have been approved for Social Security Disability payments but denied their disability benefits from their disability insurer, and claimants who have been denied benefits based upon the opinions of reviewing physicians who ignored the opinions of the claimant’s own treating and examining physicians or contradicted these opinions without adequate explanation. It is important to remember that Ms. Gallegos appears to have had strong evidence supporting her claim for disability benefits, and the cumulative effect of this evidence is what led the court to find that she was disabled.

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