In Johnson v. United of Omaha Life Insurance Company, No. 13-2645 (8th Cir. 2014), United of Omaha Life Insurance Company (“United”) is appealing the district court’s grant of summary judgment to Vicki Johnson (“Johnson”) in her action filed under ERISA seeking reversal of United’s denial of her claim long-term disability benefits.
In this case, from May 1995 until February 2009, Johnson worked for Colorado Real Estate and Investment Company, where she was covered under the employer’s disability insurance policy (the “Plan”). United was the benefits administrator for the Plan. On February 26, 2009, the day she resigned, Johnson visited Dr. Cheryl MacDonald, her primary care physician. Dr. MacDonald took Johnson’s blood pressure and diagnosed Johnson with: (1) anxiety and depression and (2) fibromyalgia and chronic pain. In October 2009, Johnson filed a claim for long-term disability benefits based on the foregoing medical conditions. United denied the claim, and Johnson filed this suit.
The issue for the Eighth Circuit Court of Appeals (the “Court”) is whether United’s decision to deny Johnson’s claim for long-term disability should be upheld. The first question is what level of review-de novo or deference-is appropriate here. Here, the official Plan document was silent on the plan administrator’s discretion to determine benefit eligibility, warranting a de novo review, but the summary plan description (the “SPD”) provided the plan administrator with this discretion, supporting a deferential review. The Court felt that these two documents had to be reconciled, based on what a reasonable employee would conclude is the administrator’s authority. The face of the Plan in this case states, “[t]he Certificate of Insurance . . . is made a part of the Policy.” The SPD was included in the Certificate of Insurance as the final part of the consecutively-paginated booklet. Also, the SPD states on its face that “[t]his Certificate is Your ERISA Summary Plan Description for the insurance benefits described herein.” Thus, a reasonable participant would understand that the policy had integrated the Certificate of Insurance along with the included SPD into the policy itself. The SPD contains a clause granting to United “the discretion and the final authority to construe and interpret the Policy,” including “the authority to decide all questions of eligibility.” Accordingly, the Court concluded that, under the needed reconciliation of the Plan document and the SPD, discretion was granted to United to determine eligibility for benefits, thereby resulting in United having the requisite authority to receive a deferential review.
Under a deferential review, United’s decision to deny the claim for long-term disability benefits will be overturned only United has committed an abuse of discretion. The Court found that this decision was based on substantial evidence, so that there was no such abuse. The substantial evidence included an absence of objective evidence of any medical condition resulting in disability. As such, the Court concluded that United’s decision to deny the claim for long-term disability benefits must be upheld.