In Whealen v. Hartford Life & Accident Ins.Co., 2007 U.S.Dist.LEXIS 51335 (C.D.Cal. June 28), the plaintiff, who had worked as a claim representative in Allstate's special investigation unit, developed fibromyalgia and ceased working in 2000. An independent evaluation conducted at Hartford's request confirmed the fibromyalgia diagnosis and deemed Whealen medically disabled. Consequently, the claim was approved under the ''own occupation'' definition of disability applicable to the first 24 months of payments.

A claim for Social Security disability benefits, which signifies an inability to work at any occupation, was also approved. Subsequently, although all of the treating doctors maintained that plaintiff was disabled from all occupations, a Hartford nurse was skeptical and requested further follow up. Surveillance was undertaken but it proved unproductive since no activity was depicted. Hartford also obtained a second review, which confirmed a chronic pain syndrome. In addition, approximately a year later, Whealen underwent surgery due to a severe sleep apnea.

Despite the consistency in the evidence supporting Whealen's disability, in April 2005, Hartford began an investigation of whether Whealen was entitled to ''any occupation'' benefits even though the change in definition occurred in 2002. While the surgeon who treated the sleep apnea had no opinions, the treating rheumatologist maintained that the plaintiff was disabled from all occupations based on her clinical presentation. A follow-up review performed by Dr. F.B. Dibble through the ''Medical Advisory Group'' elicited the treating doctor's elaboration on the presence of trigger points that may not have been noted in each clinic note but which were nonetheless found on repeated examinations. Nonetheless, Dr. Dibble concluded that there was no supporting evidence confirming disability although he suggested a psychiatric referral. Without obtaining any such evidence, though, a follow-up vocational evaluation identified several jobs Whealen could allegedly perform. Hartford then terminated benefit payments.

Whealen appealed and submitted a follow up report from the treating rheumatologist documenting various symptoms and limitations and reconfirming the doctor's opinion that Whealen was disabled. Hartford then sent the file to Reed Review Service for review. The physician who reviewed the file spoke with the treating doctor who explained his opinions, but the reviewing doctor nonetheless concluded that there was no objective support for the treating doctor's findings. Hartford therefore upheld its finding; and Whealen then filed suit.

Whealen raised five arguments in support of reducing the deference Hartford's decision should receive despite policy language clearly granting discretionary authority: (1) Hartford took inconsistent claim positions with respect to the initial independent exam, first finding it supportive of disability and then taking a contrary position; (2) Hartford failed to adequately investigate Whealen's impaired cognitive functions despite receiving specific advice to do so by its own independent medical examiner, Dr. Leonard, and by its medical reviewer, Dr. Dibble; (3) Hartford failed to credit Plaintiff's reliable reports of disability; (4) Hartford relied on known, biased physicians for its review; and (5) Hartford relied on new evidence on appeal, depriving Whealen of the right to a full and fair review of her claim. Other than the fifth argument, the court agreed with the plaintiff with respect to the first four.

As to the first issue, Hartford first claimed that the independent examiner's findings were out of date because he examined the plaintiff in May 2004 and the claim decision was made in August 2005. Nonetheless, the insurer cited the report as a ground for terminating benefits. The court characterized that action as reflecting ''inconsistency [that] bears negatively on the plausibility of the Hartford's stated reason for denying Whealen coverage.'' The court was equally suspicious of Hartford's disregard of potential cognitive dysfunction even though both the independent examiner and the file reviewer, Dr. Dibble, suggested further investigation. Despite Hartford's argument that it was not obligated to investigate mental health issues because there were no allegations by the claimant of a psychiatric impairment, the court found the insurer had ''clear notice of potential cognitive problems that would affect [plaintiff's] functionality'' yet failed to adequately investigate that aspect of the claim.

The court further faulted Hartford for either ignoring or unreasonably discounting the treating doctor's findings. The court pointed to the lengthy treatment relationship, the agreement among Hartford's consultants as to the correctness of the treating doctor's diagnosis and appropriateness of the course of treatment, and the consultants' calls to the treating physician for further explanation of his opinions. Yet the consultants and Hartford simply ignored the information that was elicited and reached contrary conclusions without explanation. Although the court apparently found some merit in plaintiff's argument that Dr. Dibble was biased based on his relationship with an organization that caters to the insurance industry and touts ''cost saving,'' the court found the evidence supporting that argument insufficiently authenticated because there was no declaration by the person who personally conducted the Internet search to locate the information or by the provider who acknowledged the genuineness of the information from the website. Nonetheless, the court found Dr. Dibble's statements inconsistent; and the court was also skeptical of his submission of different versions of his report, the latter version omitting acknowledgment of the treating doctor's recommendation of the claimant's need for rest. Thus, the court diminished the deference accorded Hartford's findings.

Turning to the merits of the dispute, the court concluded that Hartford acted arbitrarily and capriciously by relying on Dr. Dibble's report and on the report authored by Dr. Payne on behalf of Reed Review Service. The failure of those physicians to articulate an explanation for their disagreement with the treating doctor showed their opinions ''lacked a complete analysis of Whealen's claim.'' Both doctors wrote of a lack of laboratory or radiology results supporting disability; however, the court explained that it is well known that there are no tests that can diagnose fibromyalgia, and the treating physician included ample clinical findings including the presence of tender points on examination as well as the sleep study. The court also criticized Hartford's reviewing doctor for giving no explanation for rejecting the treating doctor's findings and basing an opinion solely on the absence of laboratory abnormalities. The court concluded the insurer's consultant had performed ''a less than thorough review of Whealen's claim.'' In summary, the court determined that the insurer's doctors focused solely on musculoskeletal findings and ignored other issues, thus leading to a finding that such a ''selective consideration weakens the credibility of Hartford's decision-making process.'' The court next expressed its skepticism of Hartford's vocational report because it was based on incorrect wage data, leaving only two of the seven identified occupations as possibly relevant. And as to those occupations, the court found it was unreasonable to assume Whealen could perform such jobs since she lacked the experience, education or training required. Moreover, the vocational evaluation was based solely on Dr. Dibble's report and completely ignored the treating doctor's limitations.

Consequently, the court found the evidence in the record ''overwhelmingly'' supported Whealen's disability. Since there was no doubt about the diagnosis, and the surveillance, which showed no activity whatsoever, actually supported the claimant's allegations, there was no reason to doubt the claim. Moreover, the Social Security award of disability was deemed relevant supporting evidence. Hence, the benefit denial was found arbitrary and capricious and overturned.

This case should be a wake up call to the disability insurance industry. For too long, insurers have been too complacent in their belief that the arbitrary and capricious standard of review in claims governed by the ERISA law automatically leads to a rubber-stamp of a claim denial. Insurers have also acted arrogantly in denying fibromyalgia claims by reciting the mantra of ''no objective evidence'' or the ''absence of radiologic, musculoskeletal or neurological findings.''

This case illustrates the wrong-headedness of such an approach in the face of well-supported opinions of longstanding specialist treating doctors, clinical evidence consistent with the fibromyalgia diagnosis, and corroborative evidence from other sources such as Social Security. Moreover, once the insurer acknowledged the diagnosis of fibromyalgia, its failure to also acknowledge the debilitating effects of that disorder without substantial evidence — such as surveillance showing significantly greater abilities than those claimed — established the claimant's entitlement to an award of benefits.