Court Rules LTD Benefits Properly Terminated After Plaintiff Failed to Undergo Recommended Surgery for Disability

This alert was featured in the October 2021 edition of The LHD/ERISA Advisor

In Hall v. Aetna Life Ins. Co., 2021 U.S. Dist. LEXIS 117331 (N.D. Cal. June 23, 2021), a California district court held that an ERISA claim administrator properly terminated long-term disability (LTD) benefits after the plaintiff failed to undergo recommended surgery for her disability.

The plaintiff Natasha Hall was insured under a group LTD policy issued by the defendant Aetna Life Insurance Company ("Aetna") to her employer, City National Bank ("CNB"). Hall had a long history of back pain, for which she underwent surgery for the first time in 2006 and again eight years later. Aetna began paying LTD benefits in March 2016 on the understanding that Hall would undergo a disc replacement surgery, as recommended by her treating provider. Hall's surgery was subsequently postponed several times over the course of a three-year period. During that time Hall got married, gave birth to two children, purchased and operated a yoga studio, and filed a lawsuit against CNB alleging wrongful termination. In May 2019, Hall's doctor, who had originally certified her disability, advised Aetna that Hall's surgery had been scheduled but was later cancelled because she had failed to return his office's calls or messages concerning pre-operation visits and preparation. The doctor informed Aetna that he would not be re-certifying Hall's disability extension and completed a form memorializing his decision.

Aetna sent a letter to Hall formally terminating her benefits, and Hall appealed the decision. During the appeal, Hall argued for the first time that her job required her to perform cognitively difficult tasks and her chronic pain, lack of improvement, and narcotic pain medication prevented her from undertaking such tasks. However, she failed to provide any recent medical records demonstrating functional or cognitive impairment. Aetna upheld its determination, and Hall filed an action in federal court under ERISA.

On summary judgment, Hall argued that Aetna improperly relied on her delay in scheduling, and ultimate failure to undergo, surgery as grounds for denial, and misinterpreted its conversation with her doctor. She also argued that Aetna failed to give sufficient weight to her award of Social Security Disability Insurance ("SSDI") benefits.

Applying de novo review, the court upheld Aetna's determination, finding that Hall failed to make the requisite evidentiary showing to warrant a finding of total disability. Specifically, the court noted that "together with Hall's failure to engage another doctor and her refusal (or inability) to schedule surgery, [the doctor's] disavowal casts doubt on the veracity of Hall's claims of total disability." The court also held that Hall failed to offer any evidence to counter "the reasonable assumption" that the doctor contacted Aetna because he was no longer comfortable certifying Hall's disability for medical reasons."

Finally, the court found that Aetna sufficiently considered Hall's SSDI award because Aetna included a short explanation of the differences between Social Security regulations and the LTD insurance policy. Overall, the court emphasized that Hall's arguments were focused primarily on Aetna's processes rather than her entitlement to benefits at the time of the termination and held that Hall failed to meet her burden of demonstrating that she was entitled to LTD benefits.

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