Opinion
2:06-cv-117-GEB-GGH.
November 17, 2006
ORDER
This matter was determined to be suitable for decision without oral argument. L.R. 78-230(h).
Pending are cross motions for summary judgment.
BACKGROUND
Plaintiff worked as a Certified Registered Nurse Anaesthetist ("CRNA") at Kaiser for 22 years. (Pl.'s Statement of Undisputed Facts ("Pl.'s SUF") ¶ 1.) In 1999, Plaintiff began seeking treatment for fibromyalgia and pain. (Id. ¶¶ 14, 22.) Plaintiff's physician, Dr. Heykes, diagnosed her with "fibromyalgia [and] some degree of depression and chronic fatigue." (Admin. R. 342.) Plaintiff began Ibuprofen treatment for the pain and Dr. Heykes noted it "did a fairly good job on pain control." (Id. at 127.) Dr. Heykes also "recommended a regular exercise program with Motrin and antidepressant medication." (Id. at 128.)
Plaintiff is covered by a Long Term Disability Plan ("Plan") whereby participants are entitled to benefits if they become disabled. (Defs.' Statement of Undisputed Facts ("Defs.' SUF") ¶ 2.) The Plan grants Defendant Metropolitan Life full discretion to interpret the terms of the Plan, construe Plan documents, and determine eligibility for Plan benefits in accordance with the terms of the Plan. (Id. ¶¶ 5, 6; Pl.'s SUF ¶ 35.)
Plaintiff began short term disability leave on March 24, 2001. (Pl.'s SUF ¶ 3.) Dr. Heykes completed a Disability Status Form extending Plaintiff's request for disability leave in September of 2001. (Admin. R. at 342.) At that time, he only recommended Plaintiff be absent from work for the remainder of the month. (Id.) Dr. Heykes had not seen Plaintiff since May 2001. (Id.) Nevertheless, on September 6, 2001, Plaintiff filed a claim for long term disability benefits under the Plan. (Defs.' SUF ¶ 12; Pl.'s SUF ¶ 21.)
Subsequently, Defendants had two independent reviews performed of Plaintiff's medical file. (Id. at 284.) Dr. Smith, one of the independent reviewers, noted "the medical records support the above diagnoses [of fibromyalgia, chronic fatigue, and depression]," but concluded Plaintiff was "able to work within the restrictions outlined." (Id. at 128-129.) Dr. Moyer, the other independent reviewer, noted there was nothing in the record that "would preclude a return to [Plaintiff's] regular occupation." (Id. at 284.) On January 14, 2002, Defendants denied Plaintiff's claim for benefits. (Pl.'s SUF ¶ 47.) Plaintiff filed an appeal and on April 18, 2002, Defendants sent a final denial letter to Plaintiff. (Id. ¶¶ 64, 88.)
DISCUSSION
I. Summary Judgment Motion A. Standard of Review
The standards applicable to motions for summary judgment are well known and need not be repeated here.
Plaintiff argues Defendants' denial of benefits should be reviewed de novo because Defendants have a conflict of interest. (Pl.'s Reply at 13.) Defendants rejoin the decision must be reviewed for an abuse of discretion because the Plan provides Defendants "sole and full discretionary authority." (Defs.' Opp'n at 4.)
When an insurer "acts as both the plan administrator and the funding source for benefits [it] operates under what may be termed a structural conflict of interest." Abatie v. Alta Health Life Ins. Co., 458 F.3d 955, 965 (9th Cir. 2006). However, when "the plan does confer discretionary authority . . . then the standard of review shifts to abuse of discretion." Id. at 963 (emphasis in original). Although the parties agree there is a structural conflict of interest, that alone does not require a de novo review of Defendants' decision. Id. at 967.
Both parties agree the Plan specifies the "Plan administrator and other Plan fiduciaries" have "discretionary authority to interpret the terms of the Plan and to determine eligibility for and eligibility to Plan benefits in accordance with the terms of the Plan." (Pl.'s SUF ¶ 35; Defs.' SUF ¶ 5.) However, Plaintiff contends a genuine issue of material fact exists concerning whether "the reservation in the MetLife Policy and Plan document controls here versus the SPD, which has no such reservation." (Pl.'s Opp'n at 11.) Plaintiff argues she was given a copy of the SPD but not the Plan, and therefore, the terms of the Plan do not control. (Id.) However, the SPD specifically states in the introduction that "[i]n case of any omission or conflict between what is written in this book and in the [P]lan documents, insurance contracts, and service agreements, the [P]lan documents, contract or agreement always govern." (Admin. R. 607.) Therefore, the terms of the Plan are controlling. Since Plaintiff does not dispute that the Plan unambiguously reserves full discretion for the Plan administrator, the applicable standard of review is abuse of discretion.
It is unclear what "SPD" refers to. Plaintiff's cite to the Administrative Record leads to a document entitled "Benefits By Design." (Admin. R. at 605-661.)
i. Effect of Structural Conflict of Interest
Plaintiff argues very little weight should be given to Defendants' determination that Plaintiff was not entitled to benefits under the Plan because of the structural conflict of interest. (Pl.'s Reply at 16.) Defendants contend "the Court should afford a high degree of deference" to the determination. (Defs.' Mot. for Summ. J. ("Defs.' Mot.") at 15.)
Abatie discussed the level of deference that should be accorded the Plan administrator's decision:
A district court, when faced with all the facts and circumstances, must decide in each case how much or how little to credit the plan administrator's reasons for denying insurance coverage. . . . The level of skepticism with which a court views a conflicted administrator's decision may be low if a structural conflict of interest is unaccompanied, for example, by any evidence of malice, of self-dealing, or of a parsimonious claims-granting history. A court may weigh a conflict more heavily if, for example, the administrator provides inconsistent reasons for denial, fails adequately to investigate a claim or ask the plaintiff for necessary evidence, fails to credit a claimant's reliable evidence, or has repeatedly denied benefits to deserving participants by interpreting plan terms incorrectly or by making decisions against the weight of evidence in the record.Abatie, 458 F.3d at 968-969.
Plaintiff produced no evidence of malice, self-dealing, inconsistent reasons for denial, or a parsimonious claims-granting history by Defendants. Plaintiff asserts Defendants failed to adequately investigate her claim because Defendants "took 44 days to order any of [Plaintiff's] medical records, and then only ordered and obtained 9 illegible pages of [Plaintiff's] large chart" and "made only one attempt to call [Plaintiff's] Kaiser PCP, and never called back." (Pl.'s Mot. for Summ. J. ("Pl.'s Mot.") at 5.) However, Defendants requested complete medical records from Plaintiff's treating physician and reviewed all documentation Plaintiff submitted for her claim. (Admin. R. 117, 119, 122.) In addition, the Plan specifies it is the employee's burden to submit "Proof of Disability" along with a claim for benefits. (Id. at 69.) Since Plaintiff was required to submit proof of her disability and Defendants attempted to obtain Plaintiff's complete medical history, Plaintiff has not shown that Defendants failed to adequately investigate her claim.See Bratton v. Metropolitan Life Ins. Co., 439 F. Supp. 2d 1039, 1047 (C.D. Cal. 2006) (stating it is the plaintiff's burden to "come forward with material, probative evidence" defendants' breached a fiduciary obligation in order to alter the deference afforded defendants' decision).
Nor has Plaintiff shown that Defendants failed to credit Plaintiff's reliable evidence. Both independent reviewers concluded, based on a review of Plaintiff's medical records, that Plaintiff's "medical records support the above diagnoses as well as the major depression." (Id. at 128.) Therefore, Plaintiff has not shown Defendants' failed to credit Plaintiff's reliable evidence.
Plaintiff has failed to present evidence that Defendants' decision should not be given a high degree of deference. Defendants' decision will be reviewed for an abuse of discretion.
ii. Procedural Violations
Plaintiff contends the standard of review should shift to de novo because of Defendants' "flagrant violations" including Defendants' failure to apply the "80% of earnings test" required under the Plan. (Pl.'s Reply at 14.) Defendants do not assert they applied the "80% of earnings test."
Abatie explained that when "an administrator engages in wholesale and flagrant violations of the procedural requirements of ERISA . . . we review de novo the administrator's decision to deny benefits." 458 F.3d at 971. Plaintiff argues that failing to apply the "80% of earnings" test rises to the level of a wholesale and flagrant violation. (Pl.'s Reply at 14.) However, since Defendants determined Plaintiff could continue working at her prior job at Kaiser, there was no need for Defendants to determine whether Plaintiff could make more than 80% of her previous salary. Under Defendants' determination, Plaintiff could make 100% of her previous salary because she would be performing the exact job she had before submitting her claim for benefits. Therefore, Defendants' failure to apply the "80% of earnings" test was not a flagrant violation of procedural requirements that would justify a de novo standard of review.
B. Reviewing Defendants' Determination i. Medical Reports
Plaintiff argues the reports of Defendants' independent reviewers should not be considered for this motion because they constitute hearsay. (Pl.'s Opp'n at 9.) Defendants rejoin the reports are part of the administrative record and therefore, were "properly considered by [Defendants] in making its determination, and are properly considered by this Court in determining whether the denial of Plan benefits was arbitrary and capricious." (Defs.' Reply at 6.)
When a district court reviews a plan administrator's decision for abuse of discretion, the court's decision "must rest on the administrative record." Abatie, 458 F.3d at 970; see also Urbania v. Cent. States, Se. Sw. Areas Pension Fund, 421 F.3d 580, 586 (7th Cir. 2005) (noting that "[d]eferential review of an administrative decision means review on the administrative record" (internal quotation marks omitted); Kosiba v. Merck Co., 384 F.3d 58, 67 n. 5 (3rd Cir. 2004) (noting that, "in general, the record for arbitrary-and-capricious review of ERISA benefits denial is the record made before the plan administrator"); Zervos v. Verizon N.Y., Inc., 252 F.3d 163, 173 (2d Cir. 2001) (noting that when review is for abuse of discretion, the record consists of the administrative record). Since the medical reports are part of the administrative record, they are considered. ii. Defendants' Conclusion
Plaintiff argues Defendants' decision to deny benefits was an abuse of discretion. (Pl.'s Reply at 17.) Defendants rejoin it was not an abuse of discretion to credit the opinions of the two independent reviewing physicians. (Defs.' Reply at 6.)
Plaintiff's supervisor at Kaiser filled out a Supervisor Statement describing the specific activities required of Plaintiff as a CRNA at Kaiser. (Admin. R. 340.) Based on this description of Plaintiff's job, Dr. Smith concluded Plaintiff was "able to work within the restrictions outlined." (Id. at 129.) In addition, Dr. Moyer concluded the medical records did not reflect a disability that would "prevent her from returning to her previous occupation." (Id. at 284.) Based on the analysis of the independent reviewers, Defendants concluded that despite the diagnosis of fatigue and fibromyalgia, "the records did not document disabling pain" and therefore, "[t]he file did not contain medical evidence to support the presence of limitations of such severity that they precluded [Plaintiff] from performing the duties [of] her Own Occupation." (Id. at 124-125, 134.)
Defendants were faced with conflicting determinations about Plaintiff's ability to return to her job at Kaiser. Plaintiff has not shown it was an abuse of discretion for Defendants to credit the conclusion of the two independent medical reviewers.
CONCLUSION
Defendants' motion for summary judgment on all claims is granted. Plaintiff's motion is denied. The clerk is directed to enter judgment for Defendants.IT IS SO ORDERED.