No Abuse of Discretion Where Insurer Requires Objective Evidence

An insurer denied the ERISA plan participant’s disability claim, in part, because he failed to support his claimed disability from CFS with “objective test results.” During the participant’s initial appeal of his LTD benefits, his attorney asked the insurer if there were any tests the participant should undergo in order to help establish his disability. The participant’s attorney did not receive a response and yet the insurer, citing a lack of medical documentation that Plaintiff was afflicted by CFS or that he was unable to perform the duties of his occupation, denied his claim. After explaining that a factor tending to show a potential conflict of interest is the failure to engage in meaningful dialogue during the review process, the court found that decision to deny benefits due to the absence of objective test data while opting not the request a SPECT scan was an indication of “evasiveness during the review process, and a conflict of interest.” Nevertheless, noting the distinction between a medical condition and the effect of that condition on an employee’s ability to perform occupational duties is well established, the court “affirm[ed] a plan administrator’s right to require objective evidence that employees are totally disabled by the medical condition which afflicts them, regardless the condition at issue.” The court further explained that it was not an abuse of discretion for the insurer to be skeptical of the participant’s physicians’ diagnoses given that they relied almost exclusively on acceptance of his self-reported and subjective complaints. [W]hen self-reported symptoms are accompanied by financial incentive in the form of disability benefits, a plan administrator is entitled to be wary. Accepting self-reported symptoms at face value is “more or less required of treating physicians, but by no means required of the administrator.” The court also held that video surveillance conducted after the denial of benefits was not improper, explaining that disability is an ongoing requirement in order to receive disability benefits. For that reason, the insurer did not act in “bad faith” when it recorded surveillance video after it denied benefits. Therefore, the insurer properly denied benefits.