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Appeals Court Rules in Favor of Life Insurance Company of North America Denial of Long-Term Disability Benefits

In the case of Green v. Life Insurance Company of North America (LINA), Plaintiff Michael Green was a truck driver for McLane Company, Inc. (McLane). In December 14, 2014, he began having symptoms of foggy and cloudy vision. His ophthalmologist diagnosed him with posterior vitreous detachment (PVD) in his right eye and sent him back to work. The doctor also recommended that plaintiff see a retinal specialist if his eye symptoms got worse.

On February 25, 2015, Plaintiff saw a retina specialist who diagnosed Plaintiff with “macula-off retinal detachment of the right eye.” After three unsuccessful surgeries to repair the detachment, Plaintiff suffered a permanent vision loss and was unable to return to his job as a truck driver.

Plaintiff’s application for long-term disability (LTD) benefits was denied on the grounds that his claim was barred since his disability was caused by a pre-existing condition. Plaintiff appealed that decision alleging that: 1) his retinal detachment was not caused by a pre-existing condition; and 2) LINA rewrote the policy terms just so it could deny his claim.

After exhausting his administrative appeals, and being denied every step of the way, he filed an ERISA lawsuit in the U.S. District Court for the District of Colorado. When that court denied his claim, he appealed the denial to the Circuit Court. Unfortunately for this plaintiff, the Circuit Court ruled that LINA did not act arbitrarily and capriciously in denying his claim.

Standard of Review

The Court noted that on appeal, the Court reviews “the plan administrator’s decision to deny benefits to a claimant as opposed to reviewing the district court’s ruling.” In some cases, the standard of review is de novo, which allows the Court to review the denial without giving deference to the decision of the plan administrator.

In this case, the Court deemed the standard of review was deferential, meaning it would uphold the denial of benefits, giving deference to the plan administrator, and reverse the denial or LTD only if the plan administrator acted in an arbitrary or capricious manner.

Plaintiff Had a Pre-existing Condition

LINA and the Court conducted an extensive analysis of whether or not the PVD diagnosis was a pre-existing condition to the retinal detachment. LINA relied on “five doctors’ opinions, two of whom were Mr. Greens’ own doctors,” and all agreed PVD was a “probable link” to Plaintiff’s “ultimate vision loss.” Thus, it was not arbitrary and capricious for LINA to conclude that Plaintiff had a pre-existing condition.

LINA Did Not Impermissibly Rewrite The Policy

The LINA policy, which took effect January 1, 2015, had a clause stating specifically that, “We will not pay for benefits for any period of disability caused or contributed to by, or resulting from, a Pre-existing Condition.” This meant that any condition that occurred between October 1 and December 31, 2014 would bar Plaintiff from qualifying for benefits.

Since Plaintiff’s first treatment for his PVD began December 4, 2014, the Court held that it was within the look-back period so “LINA properly denied Mr. Green’s application for LTD benefits.”

This case was not handled by our firm, but we believe it can be instructive for those who are having difficulty with their claims due to the insurer claiming the condition is pre-existing. If you have problems with this, or any other issue concern your disability claim, contact us at Dell & Schaefer for a free consultation.