The tough disability claims are often the ones where it is difficult or impossible to prove the medical condition with objective evidence (something that can be observed or measured). This requires the plan fiduciary to decide whether the subjective evidence is adequate. A recent decision, which found the fiduciary got it wrong, provides helpful guidance on how a fiduciary can evaluate subjective evidence without abusing its discretion.
In Miles v. Principal Life Ins. Co., — F.3d –, 2013 WL 3197996 (2d Cir. June 26, 2013), the plaintiff was an attorney who suffered from tinnitus, ear pain, hearing loss, headaches and vertigo. Principal conducted multiple medical reviews, and attempted to speak to plaintiff’s doctors, before denying his claim.
The court held that the question “[w]hether an alleged impairment lends itself to objective clinical findings is a factual determination to be made by the plan administrators.” But the court found that Principal erred because it “did not identify any objective findings that, considering Miles’s symptoms, it would reasonably have expected to see. Under these circumstances, we conclude that it was unreasonable for Principal to rely on the lack of objective evidence of tinnitus to deny Miles’s claim.” The court distinguished an earlier Second Circuit decision, Hobson v. Met. Life Ins. Co., 574 F.3d 75 (2d Cir. 2009), where the insurer had specifically advised the insured that trigger point tenderness was a criterion for diagnosing fibromyalgia, and asked for evidence of any trigger point tenderness.
Because Miles’ medical condition could not be proved objectively, Principal abused its discretion by not giving sufficient consideration to subjective complaints:
Looking to the record before us, we conclude that Principal did not give adequate attention to Miles’s subjective complaints, as it failed to either assign any weight to them or to provide specific reasons for its decision to discount them. … Since subjective evidence is more than ample to establish [Miles’s] disability, if believed, … Principal must do more than simply point to the subjective nature of the evidence when denying his claim. It must either assign some weight to the evidence or provide a reason for its decision not to do so. …
Principal has identified nothing in the present record that would support a rejection of Miles’s subjective complaints. Though there is no objective evidence of tinnitus, multiple specialists have said there is no objective test for it. … We do not mean to suggest that Principal is required on remand to credit Miles’s statements regarding the nature and severity of his subjective symptoms. However, considering the present record as a whole, we conclude that Principal acted arbitrarily and capriciously by disregarding Miles’s subjective complaints without providing any reason for this decision.
The lesson is that, the fiduciary has discretion to determine whether a medical condition is susceptible to objective proof. As long as that determination is reasonable (and if the claimant is given sufficient notice), a denial of the claim for failure to provide the objective evidence should be upheld. But, if the condition cannot be proved objectively, then the fiduciary should evaluate the subjective evidence, and make an explicit determination why that evidence is not sufficient to prove the claim.