Mutual Of Omaha Again Found To Be Arbitrary And Capricious In Its Claim Handling Of ERISA Disability Claim

Mutual of Omaha has a persistent history of wrongfully denying ERISA disability claims, which we see regularly in our law practice. A recent case in federal court found that the company wrongfully denied a disability claim, making an arbitrary and capricious decision.  Omaha filed a motion for a summary judgment, seeking to shut down the claimant’s ability to pursue an appeal of her case. The court determined that Omaha needed to review the appeal again. It’s not the worst result, but it’s not the best either.

Customer Service Representative with Severe Pain Issues

The claimant worked as a customer service representative for a busy bank branch. She had filed a claim for disability benefits because of terrible lower back pain, which led to her needing to have hip surgery. Omaha agreed that she was disabled from May to June 2018, the period when she was recovering from surgery. But except for that time, Omaha said she was able to perform the tasks and duties of her occupation.

Her job required standing, sitting, responding to customer queries, walking around the bank branch, and being 100% on top of her game, always with a smile and the ability to problem solve. In terrible pain, she could not even sit for extended periods of time. If she walked to another area of the bank, it took a while for her to be able to function because of the severe pain. Her denial of benefits led to an appeal, where a second review of her medical records and information about the tasks and duties of her job took place.

Mutual of Omaha Hires Numerous Experts to Build a Disability Denial Case

Omaha hired three physicians to review her case: an orthopedist, a neurosurgeon, and a pain management specialist. It also hired a vocational rehabilitation specialist. Her claim was denied again, with the explanation that the medical evidence supplied did not support her assertion of being physically or mentally unable to perform one or more of the material duties of her regular occupation.

Flawed Vocational Consideration

Omaha took the position that she had a sedentary job, where physical movement was not an issue. This was simply not true, as she had to move her body to use the computer, reach at desk and waist level frequently and constantly use the keyboard. The source used to define her occupation even describes her job as “light-duty.”

Flawed Medical Review

Medical records are a critical component of any disability insurance claim, as they are used by both parties to defend their interests. For the claimant, the medical records must reflect how their disability causes them to be unable to perform the tasks and duties of their occupation. Disability insurance companies try to mitigate overwhelming evidence of a disability with a few tactics that, for our disability law practice, are seen all too often.

The medical reviews for her case and the vocational analysis–the ones provided by the insurance company’s experts—were in direct conflict. One doctor said she could only do some tasks “occasionally” while the vocational expert said her job required “constant” keyboarding and “frequent” reaching at desk and waist level.

The two experts show that she could not perform three of the material duties of her occupation. When she challenged this finding in her appeal, Omaha took a different tactic, saying that it could rely on other experts who found a different result for her restrictions. Inconsistent medical opinions were never reconciled, as Omaha accepted one opinion, and the court noted “Omaha cannot now reverse course…”

 Paper Only Medical Reviews

Asking a doctor to make a complete and accurate diagnosis based solely on medical records and reports is akin to writing a biography from a half-empty box of documents and photos. Without conducting in-person interviews, including long interviews with friends and family members, and having an independent fact checker ensure that all of the information is correct, the autobiography is, by necessity, flawed.

The same thing occurs when a disability insurance company has a medical doctor, nurse or claims adjuster conduct a medical examination by reviewing incomplete medical records. We have seen time and time again instances where only select portions of medical records have been provided to the reviewing physician or nurse. Without having all of the information, an accurate determination of the claimant’s ability to perform the tasks and duties of their occupation can’t be made.

In this case, the court ruled that Omaha did not explain how it reconciled the doctor’s conclusions that she could not perform the reaching and movement required, with its alternate conclusion that she could perform all of her duties on a full-time basis. The court criticized Omaha for failing to acknowledge that the medical opinions were in consistent and that the denial of the claim for disability benefits was arbitrary and capricious.

Not the Best Result for a Disability Claim

The case was remanded for further proceedings, which means that the claimant has to go back through another review of her claim. It’s better than a complete denial of her appeal by the court, but it’s not as good as overturning the denial completely.

Disability insurance claimants are faced with few choices at this level. In this case, the woman will need to go through yet another medical review, against a disability insurance company that she knows is going to try to deny her claim. The built-in conflict of interest that occurs when a paid expert is providing medical reports is going to be repeated in this review, as will the battle of occupational experts. In the meantime, she is not receiving benefits and still has the headache of dealing with the disability insurance company.  We hope that she eventually does win her case.

Disability insurance denials are not easy matters. Having aggressive and experienced legal representation is the best way forward when claims are denied.

Fetter v. United of Omaha Life Insurance Co. 2021 U.S. Dist.