Case Story: Our Client v. Aetna Life Insurance Company

In this case, the plaintiff worked as a sales agent for Cendant.  Prior to their employment, they were diagnosed with HIV and received treatments for this condition since at least February 2000.  In 2001, the plaintiff suffered an acute asthma attack and applied for STD.  Their treating physician, Dr. Kemp stated that they could not return to work at this point due to their fatigue, decreased endurance and concentration.  Dr. Kemp then submitted a second APS further describing the plaintiff’s condition, explaining that they suffered from fatigue, adenopathy, lipodystrophy, gland swelling, neuropathy, and asthma.  He opined that the plaintiff could not perform any tasks that need stamina, concentration, prolonged sitting or standing and concluded that the plaintiff could not work.  In November 2001, the plaintiff was diagnosed with avascular necrosis (AVN) in their hips, which is the death of bone tissue due to a lack of blood supply that can lead to breaks in the bone and the eventual bone collapse.  The plaintiff reported that their hip problem inhibited their movement and tired them out because it took so much effort to walk and avoid hip pain.  Their doctor stated they were unable to work due to severe physical limitations.

Aetna reviewed their claim for LTD and denied it, pointing to a pre-existing condition exclusion. The plaintiff requested a review of this decision.  The plaintiff did not deny that their HIV was pre-existing; however, they later developed asthma, a swollen gland condition, and AVN.  They asserted that their asthma and AVN were not related to their HIV.  Their doctor, Dr. Kemp, supported this.  Aetna’s doctors reviewed the file and agreed that their asthma was not related to their HIV.  However, Aetna’s doctor concluded that their AVN could be a result of HIV as one of the known complications of HIV medication is AVN.  Based on their doctors’ opinions, Aetna denied LTD again.

After this denial the plaintiff went on to have a total hip replacement of both hips; however, Aetna’s doctor concluded that they were not necessarily significantly impaired from performing sedentary (their own occupations) activities.  She also stated that there was no evidence that their AVN was pre-existing or related to their HIV.  Aetna denied LTD again based on her opinion that the plaintiff was not totally disabled from performing their own occupation.

The plaintiff argued that Aetna’s decision to deny their benefits was arbitrary and capricious.  The court determined that there were three issues in this case:  (1) whether Aetna’s application of the Active Work Rule to exclude plaintiff from being covered was arbitrary and capricious; (2) whether Aetna’s determination that the plaintiff’s AVN was pre-existing was arbitrary and capricious; and (3) whether Aetna’s determination that the plaintiff’s AVN was not disabling was arbitrary and capricious.

First, the plaintiff stated that Aetna’s denial of their LTD benefits based on the Active Work Rule was arbitrary and capricious.  The plan contained an Active Work Rule, which stated that coverage for illness or injury would not take effect until the employee return to full-time work.  Here, the plaintiff left work due to asthma but then developed AVN.  Aetna argued that since the plaintiff left work because of asthma and then developed AVN without returning to work, the plaintiff was excluded from coverage under the Active Work Rule.  The court concluded that the Active Work Rule spoke in terms of coverage under the plan, not in terms of coverage for a particular disability.  Thus, since the Plaintiff was eligible for benefits when they first became disabled, the court concluded that it was not reasonable to use the Active Work Rule to deny their coverage for AVN.

Second, the plaintiff asserted that Aetna’s denial based on treating their AVN as a pre-existing condition was also arbitrary and capricious.  Only one physician ever noted that their AVN could be related to their HIV.   Four other medical opinions in the record concluded the opposite, that their AVN was not a preexisting condition.  The opinions of two of the plaintiff’s doctors, Dr. Strader and Dr. Kemp, both stated that the AVN was not related to the plaintiff’s HIV.  Aetna’s DMA came to the same conclusion that the plaintiff’s AVN was not caused by a preexisting condition.  Finally, the opinion of one of Aetna’s own file reviewer, Dr. Hopkins, concluded that there was no evidence the plaintiff’s AVN was pre-existing or related to their HIV.  Despite these four opinions, Aetna chose to rely on one file reviewer who concluded that the plaintiff’s AVN was a pre-existing condition.  Aetna is not required to give special deference to the plaintiff’s treating physician; however, Aetna may not arbitrarily rely on one of its own consultants in the face of all other contrary evidence.  See Spangler v. Lockheed Martin Energy Sys., Inc., 313 F.3d 356, 362 (6th Cir. 2002)(insurance company acted arbitrarily in relying on one report from physician instead of entire file); Williams v. International Paper Co., 227 F.3d 706, 713 (6th Cir. 200)(administrators decision not to consider all of the medical evidence was arbitrary and capricious).  Thus, the court concluded that Aetna’s conclusion that the plaintiff’s AVN was preexisting was nor reasonable based on all the evidence.

Finally, one of Aetna’s doctors, Dr. Hopkins, concluded that the plaintiff would not necessarily been impaired from sedentary duties due to their AVN.  Aetna based its denial on this doctor’s opinion.  However, several other doctors, Dr. Kemp, the DMA reviewer, and Dr. Taiwo all agreed that the plaintiff would not be able to work as a result of their AVN.  In fact, the record was full of evidence from these three that the plaintiff suffered from significant pain and physical limitations.  Their condition was so severe that the plaintiff had to undergo two hip surgeries and rehabilitation.  In light of the evidence provided in the record regarding their pain, physical limitations, surgery, and rehabilitation, the court found it hard to understand why Aetna would accept Dr. Hopkin’s opinion overall this contrary evidence.  Thus, the court found Aetna’s conclusion that the plaintiff’s AVN was not disabling was arbitrary and capricious.



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