An insurance company could not terminate an information technology analyst’s long-term disability benefits without assessing the physical and cognitive demands of his occupation, the 1st U.S. Circuit Court of Appeals has decided.

The insurer found the appellant analyst no longer disabled based on his primary care physician’s report that he had a “sedentary level of functionality” and could work 40 hours a week.

“While the record is rife with accounts of the appellant’s medical and psychological symptoms, [the insurer] never took the obligatory step of assessing whether and to what extent (if at all) the appellant’s impairments compromised his ability to carry out the material duties of his own occupation as normally performed in the national economy,” Judge Bruce M. Selya wrote for the unanimous three-judge panel.

The 20-page decision is McDonough v. Aetna Life Insurance Company, Lawyers Weekly No. 01-098-15. The full text of the ruling can be found by clicking here.

Boston attorney Mala M. Rafik represented the plaintiff. Counsel for the insurance company was Stephen D. Rosenberg of Boston.

High-pressure environment

Plaintiff-appellant Joseph McDonough worked in the information technology division of Biogen Inc.

In March 2007, he assumed the position of senior analyst III, systems administration.

“This was a high-pressure job, with responsibility for providing support for the server infrastructure at Biogen locations around the world (24 hours a day, 365 days a year),” Selya noted.

In November 2008, the plaintiff suffered the sudden onset of right-side numbness, dizziness and blurred vision. He was hospitalized and provisionally diagnosed with a stroke.

The plaintiff was eligible for disability benefits through a Biogen employee welfare benefit plan underwritten by defendant-appellee Aetna Life Insurance Co.

Under the terms of the plan, a participant is disabled on any day that the participant is “not able to perform the material duties of [his] own occupation.”

The plan defines a participant’s “own occupation” as the occupation “routinely perform[ed]” by the participant at the time the disability began as that occupation is “normally performed in the national economy.”

The plaintiff successfully applied for LTD benefits under the plan, commencing May 23, 2009. Despite extensive therapy, he continued to experience physical symptoms including sudden right-side weakness and loss of balance, as well as anxiety and panic attacks.

The plaintiff’s primary care physician referred him for mental health care in June 2009. Some of his health care providers suggested that his physical symptoms might be a reaction to stress associated with the demanding nature of his job.

On Oct. 29, 2009, the defendant informed the plaintiff by letter that his LTD benefits would be terminated as of Oct. 31, 2009. In the insurer’s judgment, the plaintiff no longer met the plan’s definition of disability. That judgment was premised in large part on his PCP’s conclusion that he could perform sedentary work 40 hours a week.

The insurer engaged four doctors, two specializing in occupational medicine and two specializing in psychology, to review the plaintiff’s medical records. All concluded that the plaintiff was no longer disabled.

The plaintiff sued under the Employee Retirement Income Security Act, or ERISA, for wrongful termination of benefits. U.S. District Court Judge Douglas P. Woodlock granted summary judgment for the insurance company on the benefits-termination claim.

‘Own occupation’ standard

The plaintiff contended on appeal that the insurer failed to evaluate his documented functional limitations in light of the duties of his own occupation as it is normally performed in the national economy.

The 1st Circuit found that Aetna’s decision to terminate the appellant’s LTD benefits was not a “reasoned Determination.”

“None of the four internal reviewers upon whom Aetna relied compared the appellant’s symptoms or impairments to any description of the physical and cognitive demands of his own occupation as that term is defined in the plan documents,” Selya said. “Nor does the administrative record support an inference that Aetna itself made any such comparison.”

Selya said there was “simply no way to tell whether the reviewers were applying a correct conception of the appellant’s own occupation (as defined in the plan documents) or some other conception.”

The plaintiff’s claim of continuing disability was “tied to the cognitive demands of a high-pressure environment where he was on call 24 hours a day, 365 days a year and responsible for managing systems and employees,” Selya said, adding that the physical demands of the plaintiff’s occupation required frequent right-hand use for computing, typing and writing.

“On this record, however, no reasonable claims administrator could tell to what extent these matters were or were not integral to the appellant’s occupation as that occupation is normally performed in the national economy,” he said. “Such a claims administrator could only guess — and a determination based on guesswork is the antithesis of a reasoned determination.”

The plan’s “own occupation” standard “was not handed down from Mount Olympus,” Selya wrote.

Rather, he said, “it was prescribed by Aetna — and having set up the benchmark, Aetna should not be heard to complain when a court holds it to its own prescription. We hold that Aetna’s failure to articulate the contours of the own occupation standard, apply that standard in a meaningful way, and reason from that standard to an appropriate conclusion regarding the appellant’s putative disability renders its benefits-termination decision arbitrary and capricious.”

The panel vacated the entry of summary judgment and remanded with instructions to remit the matter to the insurer for further review.

CASE: McDonough v. Aetna Life Insurance Company , Lawyers Weekly No. 01-098-15

COURT: 1st U.S. Circuit Court of Appeals

ISSUE: Did an insurance company make a “reasoned determination” that an employee who had suffered a stroke was no longer disabled once his primary care physician found him capable of performing sedentary work 40 hours a week?

DECISION: No, because the insurer did not assess the demands of the employee’s occupation