Harrison v. Wells Fargo Bank, N.A., No. 13-2379 (U.S. Court of Appeals for the Fourth Circuit, December 5, 2014)
In Harrison v. Wells Fargo Bank, N.A., No. 13-2379 (U.S. Court of Appeals for the Fourth Circuit, December 5, 2014), the Court determined that Defendant abused its discretion by terminating the Plaintiff’s short term disability benefits. Specifically, the Court held that Defendant did not give the Plaintiff’s claim a full and fair review pursuant to the Employee Retirement Income Security Act (“ERISA”).
Factually, Plaintiff worked for Defendant Wells Fargo as an Online Customer Service Representative. In 2011, she was diagnosed with an enlarged thyroid and large mass that extended into her chest causing chest pain and tracheal compression. She had a thyroidectomy surgery first, and a second chest surgery was scheduled for approximately two (2) months later to address the chest mass. Wells Fargo paid Plaintiff short-term disability benefits for three (3) weeks after the first surgery, but terminated benefits prior to the second surgery, since it determined that three (3) weeks was the typical recovery period for this type of operation. Additionally, while Plaintiff was facing her surgeries, her husband died unexpectedly, triggering a recurrence of depression and post-traumatic stress disorder (PTSD) related to the death of her mother and her children in a house fire in 2004. Her primary care physician doubled her dosage of antidepressants and referred her to a psychologist for additional treatment. Between those two (2) surgeries, Plaintiff sought continued short-term disability benefits on the basis of both physical and psychiatric complaints.
Defendant denied Plaintiff’s continued receipt of short-term disability benefits between the surgeries. Plaintiff filed an internal appeal of the adverse claims decision. She noted that she continued to have chest pain from the recent thyroid surgery and suffered emotional trauma from the death of her husband. Her primary care physician and thoracic surgeon provided additional documentation to this effect. Plaintiff also provided Wells Fargo with the contact information for her psychologist. Additionally. Plaintiff also provided a detailed letter from her sister, who was her primary caretaker, outlining Plaintiff’s continuing pain, disability, and severe panic attacks.
During the appeal process, Defendant sought an independent psychological peer review of Plaintiff. The psychological reviewer did not contact Plaintiff’s psychologist; he determined that the evidence in the record suggested that the recent events could have triggered PTSD; and he overall concluded that in the absence of psychiatric/psychological records or a telephone conference with Plaintiff’s psychologist, no opinion could be provided on whether Plaintiff’s psychiatric status limited Plaintiff’s functional capacity. Wells Fargo upheld its previous decision to deny benefits.
Plaintiff filed an ERISA lawsuit claiming that Defendant abused its discretion in denying her short term disability benefits. Defendant moved for summary judgment. The trial court found there was insufficient evidence of disability under the plan and granted summary judgment in favor of the Defendant. Plaintiff appealed to the Fourth Circuit.
The Fourth Circuit held that Defendant abused its discretion because it failed to contact Plaintiff’s psychologist when it was on notice that Plaintiff was seeking treatment for mental health conditions and when it had the psychologist’s contact information, as well as properly signed release forms from Plaintiff. Here, the Defendant “chose to remain willfully blind to readily available information that may well have confirmed [Plaintiff’s] theory of disability.” The Court recognized that “the primary responsibility for providing medical proof of disability undoubtedly rests with the claimant,” but also observed that the plan administrator cannot ignore medical information that may confirm the Plaintiff’s theory of disability where “there is no evidence in the record to refute that theory.” Claim administrators should “notify a claimant of specific information that they were aware was missing and that was material to the success of the claim.”
Under past precedent, claim administrators are not under a duty to secure evidence supporting a claim for disability benefits when there is reliable evidence that a claimant is not, in fact, disabled. In such cases, however, there is typically sufficient evidence in the record to refute the claimant’s theory of disability. The present case, however, was distinguishable, as even the Defendant’s peer reviewer stated that the record was incomplete and his opinion as to whether the Plaintiff’s psychiatric status limited her functional capacity could not be provided. The Defendant was “repeatedly” put on notice that Plaintiff was seeking psychiatric treatment, and even though the Defendant commissioned a psychiatric peer review, the psychiatric peer reviewer never contacted Plaintiff’s treating psychologist for further information that he determined was needed to render an opinion. Unlike in prior cases, the record in this case did not refute Plaintiff’s claim of disability.
Even though Defendant was on notice that Plaintiff was receiving treatment for potential debilitating psychological trauma, it never made clear to Plaintiff that records from her psychologist were missing and needed. Defendant noted “vaguely” and “deep into a long letter” that Plaintiff should provided relevant medical information “without ever once mentioning” the Plaintiff’s psychologist by name. Instead, Defendant “should have made clear that records from [the psychologist] were absent from the record and necessary to perfect [Plaintiff’s] claim.” Here, the Defendant breached its fiduciary duty to Plaintiff because it “neither sought readily available records” that “might have confirmed her theory of disability” nor “informed her in clear terms that those records were necessary.” Accordingly, the judgment of the trial court was reversed and the claim was returned to Defendant for proceedings consistent with this decision.