Rappa v. Connecticut General Life Ins.Co.

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Rappa v. Connecticut General Life Ins.Co., 2007 U.S.Dist.LEXIS 91094 (E.D.N.Y. 12/11/2007)(Issues: Civil Procedure, Functional Capacity Evaluations, Continuing Disability Review). The court began this opinion by raising a procedural issue about which we have repeatedly expressed concern – the proper method of disposition of an ERISA case.  The court first pointed out that the Federal Rules of Civil Procedure do not contemplate a “motion for a judgment on the administrative record,” citing Muller v. First Unum Life Ins.Co., 341 F.3d 119 (2d Cir. 2003)(Also see, Jewell v. LINA – this issue).  Nor is a summary judgment motion appropriate; and the court concluded that a “bench trial on the papers” is the most sensible means of disposition under the de novo standard, although under the arbitrary and capricious standard, the court “sits in effect as an appellate court to determine whether the denial of ERISA benefits was arbitrary and capricious.” *3 citing Rizk v. Long Term Disability Plan of the Dun & Bradstreet Corp., 862 F.Supp. 783 (E.D.N.Y. 1994)(suggesting an analogy to a Fed.R.Civ.P. 12(c) motion for judgment on the pleadings).

Turning to the merits, the court first provided a factual background and explained that Rappa had worked for Lucent Technologies as a systems analyst for 25 years before becoming disabled in 1995 due to an orthopedic impairment of the spine for which he underwent an unsuccessful spinal fusion.  Rappa’s claim was approved, and benefits were paid both under the “own occupation” definition of disability, and then under the “any occupation” definition until 2001 when benefits were discontinued after a two hour functional capacity evaluation test resulted in a determination that Rappa could sit for long enough to perform sedentary work.  Rappa appealed, and although he was invited to submit new information, before waiting for the information to be provided, Connecticut General Life (CGLIC) upheld the termination and refused to consider the evidence once it was provided, relying instead on a file review conducted by Dr. Barry Kern.  Rappa then sued and secured a remand to allow for the submission of additional evidence.  Nonetheless, CGLIC refused to overturn the termination decision.

Although the court applied the arbitrary and capricious standard of review, it nonetheless overturned CGLIC’s determination.  The court held that CGLIC’s findings were not based on substantial evidence, identifying numerous deficiencies in the termination decision.

First, the court rejected the FCE, finding:

CGLIC relies heavily on the determination of the FCE commissioned by CGLIC. Rappa disputes the diagnostic value and in particular the conclusions reached by the FCE. The Court agrees with Rappa that there is no reasonable basis for the conclusions reached by the physical therapist in the FCE. For instance, she concludes that Rappa can sit for a prolonged period with positional changes after 30 minutes, but does not indicate that she observed Rappa sit for a prolonged period of time--and in fact the entire evaluation only lasted for two hours. (R. 454, 55.) Furthermore, in contradiction to her conclusion, she observed that he had to get up and move around the waiting room after only 15 minutes. (R. 454.) Additionally, she reached this conclusion after noting and apparently crediting that Rappa's pain was increased considerably after the 2 1/2 hour car ride to the evaluation, that he "never sits except for today in the car and during the evaluation," that he struggles with dressing activities including putting his shoes on, and that "[h]e reports doing nothing during the day and that he just lays  on his couch all day as that is the only position that is comfortable." (R. 454.) Moreover, she does not address how his asserted complete inability to bend forward could be accommodated in the work place. (R. 455.) Therefore, the Court concludes that the FCE is suspect and does not provide a sufficient basis on which to deny Rappa's benefits. *28-*29.

Consequently, the transferable skills analysis performed by CGLIC, which was based on the faulty FCE, was similarly rejected.  The court also pointed out that the same findings which CGLIC cited as the basis for its determination that Rappa could work at a sedentary job had been relied on by the insurer for several years as the basis for concluding that Rappa was totally disabled.  Nor was there any basis for finding improvement; hence, the court explained:

Accordingly, despite CGLIC's position that Rappa has improved, there is no sound basis in the record to conclude that Rappa's back condition, which CGLIC originally found to be disabling with respect to his prior occupation, has in fact improved. Decisions to terminate benefits in the absence of a change in condition have been held to have been arbitrary and capricious. See Connors v. Connecticut Gen. Life Ins. Co., 272 F.3d 127, 136 (2d Cir. 2001) (a "reversal in policy preceded by no significant change in [plaintiff's] physical condition" is reason to accord less weight to the defendant's evidence); McOsker v. Paul Revere Life Ins. Co., 279 F.3d 586, 589 (8th Cir. 2002) ("[U]nless information available to an insurer alters in some significant way, the previous payment of benefits is a circumstance that must weigh against the propriety of an insurer's decision to discontinue those payments."). Therefore, the TSA's conclusion that Rappa can do certain sedentary jobs because he can sit for up to 30 minutes at a time does not provide CGLIC with a sufficient basis on which to deny Rappa's benefits. *31-*32.

The court likewise found deficiencies in the medical evidence.  The court determined that CGLIC misinterpreted information checked off on a form by a treating doctor, and that a cardiologist’s opinion was not a basis for CGLIC’s findings either since the cardiologist noted that most of Rappa’s problems were “noncardiac.”  Dr. Kern’s findings were similarly rejected, with the court ruling:

Additionally, Dr. Kern's report can not reasonably be relied upon in the face of the substantial contradictory evidence from Rappa's treating and examining physicians. Foremost, Kern's report was not based on any interaction with Rappa, but rather merely on review of the paper record. Further, rather than prepare his own independent report, Dr. Kern was merely given five specific questions by CGLIC--which were all answered in CGLIC's favor. Moreover, in answering those questions and concluding that Rappa could return to work, Kern fails to adequately and credibly rebut  the findings of Rappa's treating physicians. Dr. Kern's report does not constitute substantial evidence. It directly contradicts the opinions of the examining physicians, all of who stated that Rappa is permanently disabled and could not return to work. 12 It provides no reasons for why he disagrees with them. By contrast, with the exception of Dr. Vergara's inconsistent and somewhat confusing statement, the examining physicians (Drs. Spivak, Gilbert, Reitberg, and Gilbert) all clearly provided the basis for their conclusions and stated them without equivocation--and those conclusions are far more probative that Dr. Kern's. See Soron v. Liberty Life Assurance Co. of Boston, No. 5:02CV1514, 2005 WL 1173076, at *12 (N.D.N.Y. May 2, 2005) (discussing the logically superior probative value of reports prepared by treating physicians as compared to the lesser value of those prepared by non-examining reviewers).  *34-*35.

Accordingly, the court reversed CGLIC’s findings and reinstated Rappa’s benefits.

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