Debra Letvinuck sued Aetna in District Court after Aetna denied her short-term and long-term disability benefits. After the District Court concluded that Aetna did not abuse its discretion in denying Letvinuck benefits, Letvinuck appealed to the 9th Circuit Court of Appeals.

Aetna both funds and administers the Plan’s long-term disability benefits.

Aetna’s dual role rendered it subject to a conflict of interest when making claims determinations. Because of the structural conflict of interest, Aetna’s denial decision was reviewed while considering case-specific factors that may evidence a conflicted claim evaluation.

Failure to address a Social Security award of disability benefits offers support that the plan administrator’s denial was arbitrary.

When reviewing Letvinuck’s claim for benefits, Aetna gave no weight to the Social Security Administration’s (SSA) decision that Letvinuck was disabled, nor did it provide an explanation. Although Aetna was not bound by the SSA’s disability determination, the court noted that "not distinguishing the SSA’s contrary conclusion may indicate a failure to consider relevant evidence."

During the ERISA appeal process, Aetna and its hired doctors acknowledged that Letvinuck had received an SSA award but no further explanation was provided. Only when Letvinuck called after Aetna had denied her appeal did Aetna offer an explanation by trying to distinguish its standard for disability from the SSA’s.

Aetna failed to adequately tell Letvinuck what "additional material or information was necessary for her to perfect the claim, and to do so in a manner designed to be understood by the claimant.

Aetna based its denial of benefits substantially on the lack of recent neuropsychological testing that would objectively show Letvinuck’s disability. However, Aetna did not ask Levinuck for more recent neuropsychological test results that showed her disability. More importantly, it failed to do so "at a time when she had a fair chance to present evidence on this point.

In essence, Aetna denied Levinuck’s claim largely on account of the absence of objective medical evidence, yet failed to tell her what medical evidence it wanted.

Aetna’s communications with Letvinuck’s doctor asking for objective medical evidence was not sufficient.

Although Aetna presented evidence that it asked one of Levinuck’s doctors for "clinically objective findings demonstrating… a further decline in her disability," the court found it inconsequential because the request was not specifically communicated to Levinuck.

Conclusion

The court ultimately concluded that Aetna had abused its discretion in denying Letvinuck benefits. Aetna had based its denial on the absence of specific medical evidence—evidence that Aetna did not tell Letvinuck she should obtain and send to Aetna to perfect her claim. Moreover, Aetna failed to meaningfully explain why it disagreed with the SSA’s award of disability benefits.

The Court reversed Aetna’s denial of long term disability benefits.  

About the author: Gregory Michael Dell is an attorney and managing partner of the disability income division of Attorneys Dell & Schaefer. Mr. Dell and his team of lawyers have assisted thousands of long-term disability claimants with their claims against every major disability insurance company. To request a free legal consultation call 800-411-9085.