One court recently analyzed the extent to which an insurer can rely on a reviewing physician over a treating physician, and why it is important to take note of any recommendations made by the reviewing physician.

1. May an insurer rely on a non-treating physician to deny a long-term disability (LTD) claim, yet ignore the non-treating physician’s recommendation for further testing? No, according to Hennen. In this case, the policy at issue had a "neuromusculoskeletal and soft tissue disorders" provision, which limited payment for disabilities caused by these conditions to 24 months. There was, however, an exception to this limitation for disabilities caused by radiculopathy. Enter the plaintiff’s claim. The plaintiff had four physicians who – based on clinical observation – opined that her disability was caused by radiculopathy. Yet, MetLife terminated her LTD benefits after 24 months based on the neuromusculoskeletal limitation. In doing so, MetLife relied on one of its non-treating reviewing physicians, Dr. Neil McPhee, who opined that there was no evidence of "active radiculopathy" because the plaintiff's MRI did not reveal ongoing nerve compression. In reaching this opinion, however, Dr. McPhee recommended additional electrodiagnostic testing. MetLife did not follow through with this recommendation before it terminated LTD benefits. Because of this, the court determined that MetLife’s decision was arbitrary. Specifically, it opined that "MetLife acted arbitrarily when it discounted the opinions of four doctors who diagnosed [plaintiff] with radiculopathy in favor of the opinion of one physician who ultimately disagreed, but only while recommending additional testing that MetLife declined to pursue." The case was remanded. See Items 2 and 3 for the questions on remand. Hennen v. Metropolitan Life Insurance Company, No. 17-3080, 2018 WL 4376994 (7th Cir. Sept. 14, 2018).

2. ON THE LOOKOUT: How does the policy define the condition versus what the insurer requires on review? On remand, the district court in Hennen must address the following: MetLife’s policy defines radiculopathy as "[d]isease of the peripheral nerve roots supported by objective clinical findings of nerve pathology." It does not define radiculopathy as nerve root disorders resulting from ongoing compression. Therefore, was it reasonable for MetLife to require ongoing compression of a nerve root? We will monitor this question and report back in future issues of the Friday Five.

3. ON THE LOOKOUT: What does medical literature suggest about how a condition is diagnosed versus what the insurer requires on review? On remand, the district court in Hennen must also address the following: available medical literature indicates that radiculopathy may occur without electrodiagnostic findings. Therefore, was it reasonable for MetLife to disregard the clinical observations of the plaintiff’s treating physicians and require conclusive imaging results for radiculopathy? We will monitor this question and report back in future issues of the Friday Five.

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Two courts have faced and analyzed creative ways that claimants can fit their claims into – and carve their claims out of – ERISA.

4. May a claimant challenge an overpayment by asserting equitable defenses? Maybe, according to Jalali. In this case, the plaintiff was injured in a car accident, and in addition to receiving ERISA-governed disability benefits from Unum, she also settled her tort claim for $631,530 after attorney fees and costs. Sometime after the tort settlement, Unum discontinued benefits, determining she was no longer disabled. The plaintiff sued Unum. During that suit, Unum did not seek reimbursement of the tort settlement proceeds. It was only after that court ordered Unum to resume monthly disability payments, that Unum sought repayment from the tort settlement. It did so by reducing disability benefits to zero for 102 consecutive months, until it recouped the overpayment. In response, the plaintiff filed another suit and claimed the offset was inequitable. In this second suit, the plaintiff brought an action against Unum under 29 U.S.C. §1132(a)(3), which allows for "appropriate equitable relief." Unum argued that the plaintiff’s claims did not seek an equitable remedy, but instead were to recover benefits and enforce her rights under the terms of the policy. The court disagreed, stating that "non-enforcement of particular policy provisions that would otherwise entitle Unum to reimbursement is itself a suggested reform" and "[t]he power to reform contracts (as contrasted with the power to enforce contracts as written) is a traditional power of an equity court …." For this reason, the plaintiff’s claim survived summary judgment, in part. Jalali v. Unum Life Ins. Co. of Am., No. 16-CV-512, 2018 WL 4468207 (S.D. Ohio September 18, 2018).

5. May a foreign national working outside of the United States bring a claim under ERISA? No, according to Bajrami. In this case, the plaintiff, Salih Bajrami, was a citizen of the Republic of Kosovo who signed an annual contract to work for AECOM/GSS Ltd., a corporation based in the Cayman Islands. To support United States military efforts in Afghanistan, AECOM assigned Bajrami to work there as a driver of heavy trucks and forklifts. During his employment with AECOM, Bajrami had the opportunity to participate in AECOM’s group short-term and long-term disability insurance policies, which were issued and administered by Reliance Standard Insurance Company. Ultimately, Bajrami sought disability benefits under those policies, but Reliance denied disability benefits to the plaintiff. Bajrami initiated a civil action against Reliance in the Philadelphia Court of Common Pleas. Reliance removed the action to federal court on the basis of federal question jurisdiction, under ERISA, and moved to dismiss all counts of the complaint as being preempted by the statute. Bajrami moved to remand, asserting that the court lacks subject matter jurisdiction, as he is not covered by ERISA as a foreign national working for a foreign company. In granting Bajrami’s motion to remand, the court relied on the doctrine of extraterritoriality, which indicates that Congressional legislation is meant to apply only within the territorial jurisdiction, unless a contrary intent appears. Finding no language in ERISA that could establish a clearly expressed congressional intent to extend coverage outside of the United States, the court granted the motion to remand based on lack of subject matter jurisdiction. Bajrami v. Reliance Standard Life Insurance Co., No. 18-cv-162, 2018 WL 4635714 (E.D.Pa. Sept. 27, 2018).