Court Upholds Reliance Standard’s Denial of Long-Term Disability Benefits to Surgeon with Mental Impairments

In this dispute over long-term disability benefits, Cruz v. Reliance Standard Life Insurance Company, No. CIV 18-0974 RB/SCY, 2021 WL 601827 (D.N.M. Feb. 16, 2021), the district court upheld Reliance Standard’s denial of benefits for Dr. Cruz, who asserted disability from his own occupation as a surgeon. For claimants, this case highlights the importance of making sure all necessary information is part of the claims record before an administrator makes a final decision on an ERISA benefits claim. For administrators, it highlights the importance substantially complying with ERISA’s procedural requirements.

In a previous order in this matter, Cruz v. Reliance Standard Life Ins. Co., No. CIV 18-0974 RB/SCY, 2020 WL 7248102 (D.N.M. Dec. 9, 2020), the court found that Reliance Standard violated ERISA’s procedural requirements by not informing Dr. Cruz of the applicable time frames and appeal procedures which applied to his claim and that he was prejudiced by Reliance Standard’s failure to adhere to the applicable deadlines. Based on this, the court excused Dr. Cruz’s late filing of his appeal to Reliance Standard and deemed Dr. Cruz to have exhausted his administrative remedies. The court also determined that it would apply a de novo standard of review to Dr. Cruz’s claim due to Reliance Standard’s failure to issue a timely decision.

In the most recent court decision in this case, the court, applying de novo review, considered whether it would admit extra-record evidence and whether Dr. Cruz met his burden of establishing entitlement to benefits. On de novo review, the standard “is whether the plaintiff’s claim for benefits is supported by a preponderance of the evidence based on the court’s independent review.” Although the parties moved for summary judgment under FRCP 56, the normal standard for motions under Rule 56 do not apply. “[T]he factual determination of eligibility for benefits is decided solely on the administrative record, and the non-moving party is not entitled to the usual inferences in its favor.”

The ERISA record for review. Dr. Cruz requested that the court admit extra-record evidence, including (1) a certification in the specialty of surgery from the American Board of Surgery, Inc.; (2) a December 28, 2020 medical opinion in the form of a letter from non-examining physician R.L. Romanik, M.D., P.C.; and (3) progress notes from treating physician Sharon Cooperman, M.D., dated February and April 2020.

The court noted the Tenth Circuit’s four-prong test that a party must meet before a court may consider the evidence: (1) it is necessary to the district court’s de novo review; (2) the evidence could not have been submitted to the plan administrator at the time the challenged decision was made; (3) the evidence is not cumulative or repetitive; nor (4) that it is simply better evidence than the claimant mustered for the claim review. See Hall v. UNUM Life Ins. Co. of Am., 300 F.3d 1197, 1203 (10th Cir. 2002) (the Hall test). Even if all four prongs are met, the district court has the discretion to decide that it is not necessary to consider the new evidence.

Because Reliance Standard stipulated that Dr. Cruz should be classified as a surgeon, the certificate is not necessary to supplement the record. With respect to the other two exhibits, the court found that they are also not necessary. Dr. Romanik opined that Dr. Cruz’s symptoms can be explained by the diagnosis of bipolar disorder and he would not be fit to be a surgeon without appropriate treatment. The court found that the opinion did not offer “specific, objective findings of limitations during the relevant period to explain how Dr. Cruz was unable to perform the duties of a surgeon.” The court found the same to be true for Dr. Cooperman’s progress notes. They document Dr. Cruz’s subjective complaints of symptoms (e.g., memory loss, cluster headaches, episodes of severe anger, etc.) but because they were reported in 2020, they are not relevant or necessary to the court’s analysis of whether Dr. Cruz was disabled five years prior. The court also found that Dr. Cruz did not establish the evidence could not have been submitted to Reliance Standard earlier (by, for example, pursuing medical treatment related to bipolar disorder earlier). Though the evidence is not cumulative or repetitive, Dr. Cruz failed to establish that it is not “simply better.”

Dr. Cruz failed to establish that he was Totally Disabled under the policy. Dr. Cruz has the burden of showing that he cannot perform the material duties of his Regular Occupation from his date of disability through the end of the Elimination Period (waiting period). His Regular Occupation is that of a surgeon. The Dictionary of Occupational Titles (DOT) details the position of Surgeon, Code 070.101-094, as follows:

Performs surgery to correct deformities, repair injuries, prevent diseases, and improve function in patients: Examines patient to verify necessity of operation, estimate possible risk to patient, and determine best operational procedure. Reviews reports of patient’s general physical condition, reactions to medications, and medical history. Examines instruments, equipment, and surgical setup to ensure that antiseptic and aseptic methods have been followed. Performs operations, using variety of surgical instruments and employing established surgical techniques appropriate for specific procedures….

In November 2015, Dr. Cruz “self-admitted to a 30-day drug rehabilitation program at the Florida Center for Recovery due to substance and alcohol abuse.” It is undisputed that he was unable to work through May 1, 2016. Reliance Standard’s reviewing physician, Dr. Roy Sanders, found that Dr. Cruz’s condition had significantly improved by the end of April 2016 such that he could return to work on a full-time basis without restriction. “By that time he was more stable. Medications had been weaned. He had ongoing support and was still sober and being monitored by the state licensing agency.” Dr. Sanders also opined that Dr. Cruz did not have a cognitive impairment that would keep him from engaging in work equivalent to his level of training.

The court found that Dr. Cruz has not shown that his limitations precluded him from performing the material duties of his Regular Occupation throughout the Elimination Period. Specifically, the court found that: (1) Dr. Cruz failed to show evidence of “psychosis,” paranoia, or hallucinations; (2) Dr. Cruz failed to show limitations or restrictions that show he could not perform his material duties as a surgeon; (3) Dr. Cruz fails to show that Dr. Sanders’ report is unreliable because he refers to Dr. Cruz’s occupation as a physician and not a surgeon; and (4) Dr. Cruz’s claim is not supported by a preponderance of the evidence—he stopped taking Zoloft and rarely used Seroquel and he was only moderately limited in his ability to perform complex and varied tasks. For these reasons, the court determined that Dr. Cruz is not entitled to an award of long-term disability benefits and Reliance Standard’s decision was correct.

As shown above, it can be challenging for claimants to demonstrate entitlement to employer-provided long-term disability benefits. If Reliance Standard has denied your claim for disability benefits, contact us for a complimentary case evaluation.