Standard Insurance

The case we are going to discuss here highlights one of the ways an insurance company attempts to justify discontinuance of benefits after they have begun paying them.

George Nevitt was a practicing attorney who fell down a flight of stairs on June 19, 2001. His injuries were severe enough that he began receiving long-term disability benefits from Standard Insurance Company (Standard), the company that provided his company's employee welfare benefit plan. In April 2007, Standard terminated Nevitt's coverage claiming that he no longer qualified because of the mental disorder limitation of the plan.

Nevitt exhausted all of his administrative remedies and filed suit before the United States District Court for the Northern District of Georgia, Atlanta division. He requested summary judgment. Standard responded by moving for summary judgment on their behalf. Nevitt responded by filing a cross motion for summary judgment, so Standard filed an additional motion for summary judgment. Nevitt then moved to strike Standard's additional motion. (This is typical.)

Let's look at the background presented by the administrative record. After his fall, Nevitt began to experience frequent migraine headaches, pain in his neck and both arms. His cognitive abilities were also impaired. In August, he saw his primary care physician, a neurologist and a physical therapist. He was forced to cut back the number of hours he worked and finally underwent an MRI in September. The MRI revealed that he had herniations on both the C-4-C-5 and C-6-C-7 discs as well as a deformation of his spinal cord. Other damage was also apparent in the MRI.

On November 15, 2001, Nevitt filed a claim for partial disability benefits. He had not been with the legal firm for a full year yet, so Standard made sure that Nevitt did not have a pre-existing condition. They had an internal medicine consultant review his medical records. No pre-existing condition was found. This doctor noted that Nevitt's condition should gradually improve over time.

When Nevitt's condition did not improve, his neurologist recommended that he consult a neurosurgeon. He did this in May of 2002. The neurosurgeon suggested that he needed surgery to repair the herniations and spondylitic spurring shown on the MRI. Nevitt was reluctant to go under the knife, so the neurosurgeon referred him to a board certified pain management and rehabilitation specialist.

In December of 2003, Nevitt stopped working entirely. An independent medical examiner checked him for his workman's comp claim. The doctor that conducted the exam reported that he could return back to work if the duties of his job were modified. Nevitt went back to his neurosurgeon who again recommended surgery, but referred Nevitt to a neuropsychologist who diagnosed him with post-concussive injuries, concluding that Nevitt's cognitive impairment affected his ability to practice law. He noted that Nevitt was emotionally distressed which was affecting his cognitive abilities. As a result, he recommended pharmacological treatment for depression.

Nine months later in August 2004, Standard ordered an independent medical examination. This doctor concluded that Nevitt had no neuropsychological issues that would limit his ability to work. His attending physician disagreed and continued to restrict him from working.

Another year passed. In August 2005, Standard asked a neurologist to review Nevitt's records. This neurologist concluded that Nevitt was not disabled from practicing law. He recommended follow-up treatment for Nevitt's migraines. At the same time, Standard asked a psychiatrist to review Nevitt's records. She concluded that he had suffered from major depression at times but he could return to work with emotional support. His treating physician disagreed, and continued to restrict him from returning to work.

In October 2006, Standard ordered an independent medical exam. This neurologist, after seeing Nevitt, concluded that Nevitt's complaints were out of proportion to his injury. There was no reason why he could not perform a sedentary desk job without any restrictions.

Standard terminated Nevitt's long-term disability benefits in April 2007. They stated that his benefits were limited to 24 months because anxiety and depression contributed to his disability. He appealed on October 12, 2007, citing his cervical pain, migraine headaches, and brain injury. These were independently disabling and were not subject to the mental disorder limitation. He provided affidavits from his attending physicians, a detailed account of his fall, a functional capacity evaluation and job simulation test as evidence of his disability not being related to a mental condition. The same claims specialist who had determined that he no longer qualified for long-term disability reviewed the additional material and upheld the termination.

The file was sent to Standard's Administrative Review Unit for an independent review. Nevitt submitted additional documentation. One report from a neurologist stated that his migraines could be expected to cause him to miss 5 to 7 days of work every month. A second report from a vocational consultant stated that Nevitt was no longer able to practice law because of his limitations. Standard also submitted a neurologist's report that disagreed, claiming that the migraine should only impair Nevitt for one or two days per occurrence. He could not see how this would disable him from practicing law.

The Administrative Review Unit upheld Standard's termination of benefits. They gave Nevitt copies of the medical records that were used to make its determination. In response, Nevitt underwent additional tests to address the concerns that Standard's consulting physicians have expressed. The results of these tests were sent to the claims specialist for consideration. The specialist stated that the tests relayed no new information. The original decision to terminate with upheld.

In order to sort this matter out, the Court looked at several things. First, the Court had to evaluate the reasonableness of Standard's determination in the light of the material recorded in the administrative record. To do this the Court had to determine whether the Court agreed with the claim administrator's benefits denial decision.

The Court looked at the policy language. What had Standard promised in the policy? First, the policy stated that it covered disability which resulted from physical disease, injury, pregnancy, or mental disorder if the policyholder was unable to work within their "own occupation." The policy stated that long-term benefits were limited to 24 months for "each period of continuous disability caused or contributed to by a mental disorder." Included in mental disorders were things such as "depression or depressive disorders" and "anxiety and anxiety disorders."

Nevitt argued that his condition did not fall under the clause for mental disorder because he was totally disabled apart from any mental problems that he might have. The Court agreed. When the Court reviewed the administrative record used at the time of the decision to terminate Nevitt's long-term disability policy, the Court reached a different decision. They determined that the administrative record demonstrated at least three conditions, other than a mental disorder, that contributed to Nevitt's disability. The medical records substantiated the continued probability of Nevitt's missing work for at least 5 to 7 days per month-unacceptable in the practice of law.

Nevitt's motion for summary judgment was granted on December 3, 2009. Standard must reinstate his long-term disability coverage.