Opinion ID: 173652
Heading Depth: 2
Heading Rank: 2

Heading: Review of Decision Denying Benefits

Text: Appellants argue that the administrative record supports Reliance’s determination that Gunn was not disabled. Appellants do not dispute that Gunn is unable to work due to a mental or nervous disorder, namely, severe depression, nor does Reliance dispute that Gunn suffers from multiple sclerosis and has some physical symptoms as a result of the disease. Appellants’ position is that the language of the mental illness exclusion required Gunn to show that he was totally disabled solely due to his physical condition stemming from his multiple sclerosis, without taking into account the disabling effects of any mental or nervous disorders. This interpretation of the limitation for mental and nervous disorders does not conflict with other Plan terms and is reasonable. The records of Gunn’s treating physicians support Reliance’s finding that Gunn’s multiple sclerosis alone was not disabling. In his treatment notes of April 9 9, 2001, Dr. Robert Andiman, M.D., a neurologist, stated that Gunn had “M.S. - no exacerbation.” Dr. Andiman’s notes of April 15, 2002, indicated that Gunn reported problems with balance, but his notes for May 13, 2002, reported that Gunn had completed seven physical therapy sessions and that his strength was improving. In his report of October 27, 2003, Dr. David W. Brandes, M.D., a neurologist, diagnosed Gunn as having a remitting/relapsing form of MS. In his treatment notes dated December 23, 2003, Dr. Brandes referred to Gunn’s multiple sclerosis as “mild.” Reliance also relied on the independent medical examination of Gunn by Dr. Carl Orfuss, M.D., a board-certified neurologist and psychiatrist, which included a physical examination of Gunn and a review of Gunn’s medical records. Dr. Orfuss noted that Gunn had physical impairment in the form of mild gait instability, which was not in itself a disabling symptom, and he expressed the opinion that Gunn would not be prevented by his multiple sclerosis from working at a sedentary job. Reliance also obtained a records review by Dr. William Hauptman, M.D., who is board certified in internal medicine, gastroenterology and quality assurance and utilization review. Dr. Hauptman opined that the medical records did not support impairment from sedentary work predicated upon Gunn’s multiple sclerosis. Some medical records stated that Gunn was disabled “both” as a result of 10 multiple sclerosis and depression. However, the use of the word “both” in these records could be interpreted as meaning that either severe depression or multiple sclerosis, viewed independently, rendered Gunn disabled, but also simply that multiple sclerosis and severe depression were two conditions which contributed to Gunn’s overall disability. The opinion that multiple sclerosis and severe depression, considered together, resulted in total disability is not sufficient to avoid the policy limitation precluding benefits where mental or nervous disorders caused “or contributed to” the applicant’s disability. Although Gunn’s treating physicians documented Gunn’s symptoms of multiple sclerosis, they never addressed the specific question of whether Gunn would meet the definition of total disability based solely on his multiple sclerosis without considering his severe depression. Gunn argues that even if his disability must be due solely to multiple sclerosis, his mental symptoms of depression and cognitive dysfunction were attributable to multiple sclerosis, a physical disease; therefore, these mental symptoms could be considered in establishing disability without violating the limitation for mental and nervous disorders. Under this interpretation, the mental illness limitation would only apply if the mental or nervous disorder causing or contributing to the participant’s disability was a condition totally independent from any depression, fatigue, and cognitive deficits that would normally occur when a 11 person suffers from multiple sclerosis or some other physical illness. The Plan definition says nothing about the mental or nervous disorder having to originate from a cause completely independent from the claimant’s physical illness. However, even assuming that Gunn’s interpretation of the mental illness limitation is correct, the medical records fail to establish that Gunn’s depression and cognitive dysfunction were solely attributable to his multiple sclerosis or attributable to a degree sufficient to result in disability based on the symptoms of multiple sclerosis. Although Dr. Michael P. Gross, Gunn’s treating psychiatrist, raised the issue of whether Gunn’s depression arose from his multiple sclerosis in his April 1, 2002, report , he reached no conclusion in that regard, stating, “It is not clear, and probably irrelevant, whether there is a direct neurological connection between the psychiatric symptoms and the multiple sclerosis for this patient.” On the questionnaire completed that same date, he stated that Gunn “has multiple sclerosis and mood and thinking difficulty” and that “multiple sclerosis contributes to mental picture,” thus suggesting that there were other causes for Gunn’s mental problems. The records of Dr. Brandes likewise do not establish that Gunn’s depression was solely attributable to his multiple sclerosis. In his report of October 27, 2003, Dr. Brandes stated that “the main cause of the disability is the MS related fatigue and cognitive dysfunction.” However, Dr. Brandes provided a 12 multiple axis diagnosis of: (1) relapsing-remitting multiple sclerosis; (2) severe depression; (3) fatigue secondary to #1; and (4) cognitive dysfunction secondary to #1 and/or #2. This diagnosis indicates that he viewed Gunn’s “severe depression” as a separate illness which was at least a contributing cause of Gunn’s cognitive dysfunction and disability. The fact that in his treatment notes of December 23, 2003, Dr. Brandes described Gunn’s multiple sclerosis as “mild” but noted that he had “severe depression” also indicates that he did not regard Gunn’s severe depression as being solely a symptom of his multiple sclerosis. In contrast, Dr. Orfuss diagnosed Gunn as being“severely disabled because of ongoing psychiatric illness manifested by severe depression, excessive fatigue, lack of energy, sleeplessness, etc.” Dr. Orfuss stated that he “would attribute [Gunn’s] disability ... to the psychiatric problem and not to the multiple sclerosis.” Dr. Hauptman agreed with the opinion of Dr. Orfuss that Gunn’s cognitive deficits were based on psychiatric disease and not on multiple sclerosis. There is additional evidence in the record which supports a finding that Gunn suffered from severe depressive and anxiety disorders of psychiatric origin which were independent of his multiple sclerosis, including: the finding of the Social Security Administration law judge that the severity of Gunn’s depression met the requirements for an affective disorder; the February 28, 2001, emergency 13 room records diagnosing severe anxiety disorder with catatonia; the March 8, 2001, diagnosis of depressive disorder given by psychiatrist Dr. Drest Gorchynski; Dr. Gross’s April 1, 2002, report stating that Gunn was “clinically depressed” and giving a diagnosis of bipolar disorder (there is no evidence in the record that multiple sclerosis can cause bipolar disorder); the April 29, 2002, diagnosis of severe depression offered by Dr. Leslie P. Weiner, a neurologist; and the December 23, 2003, treatment notes of Dr. Brandes, stating that Gunn suffered from severe depression. The record includes several reports indicating that Gunn had a documented history of depressive episodes long before he was diagnosed with multiple sclerosis, including one severe episode with suicidal thoughts while in his teens, which also supports a finding of a separate origin for his psychiatric problems. Reliance’s decision to deny benefits was grounded on a reasonable factual basis for concluding that Gunn’s multiple sclerosis alone was not disabling, and that, but for his psychiatric mental and nervous disorders, he would be able to work. Reliance adequately explained the reasons for its decision in its letters of September 10, 2003, and March 11, 2004, and demonstrated that it considered the evidence presented by Gunn. Reliance had discretion to weigh the conflicting evidence, and did not abuse that discretion in denying benefits. See Black & 14 Decker Disabil. Plan v. Nord, 538 U.S. 822, at 831-34 (2003).
Appellants argue that the district court erred in its conflict of interest analysis. The first ground for the existence of a conflict of interest cited by the district court concerned Reliance’s letter of April 16, 2003, to Gunn, which referred specifically to the new definition of “disability” applicable after 24 months, but did not specifically note the Plan’s limitation for mental illness. The district court concluded that this deprived Gunn’s physicians of the opportunity to focus on the issue of whether Gunn’s disability stemmed from his multiple sclerosis, his depression, or both. Gunn II, 592 F.Supp.2d at 1261. Gunn argues that Reliance deliberately omitted any reference to the mental illness limitation in the hopes that Gunn would supply only the name of his psychologist so that the mental illness limitation could be applied. However, the letter was not suggestive and imposed no limitations on the type of medical information which could be submitted; it requested “any medical information or vocational information that you would like us to consider in making our decision,” not just information bearing on Gunn’s mental condition. There is no language in the letter or questionnaire which would suggest to Gunn that Reliance was not interested in receiving information concerning his multiple sclerosis symptoms. 15 Gunn argues that Reliance did not comply with the requirements of 29 C.F.R. § 2560.503-1(g), citing Booton v. Lockheed Medical Benefit Plan, 110 F.3d 1461 (9th Cir. 1997).9 The notification requirements of § 2560.503-1(g)(iii) refer only to the contents of a notification of adverse benefit determination. Likewise, this court in Booton did not specifically interpret that regulation as requiring that a request for additional information be made before the initial denial of benefits, but rather stated that “[i]f benefits are denied in whole or in part, the reason for the denial must be stated in reasonably clear language[.]” Booton, 110 F.3d at 1463 (emphasis supplied). However, even assuming arguendo that Reliance should have mentioned the mental illness limitation in the April 16th letter, Reliance’s failure to do so does not give rise to an inference that Reliance acted in bad faith. Neither the regulation nor this court’s decision in Booten would have placed Reliance on clear notice of any obligation to cite all potentially relevant plan provisions in a letter requesting medical information for a benefits eligibility review. In addition, Gunn was given a full and fair review of his claim. He was given notice of the mental illness 9 Section 2560.503-1(g) requires a plan administrator to “provide a claimant with written or electronic notification of any adverse benefit determination.” § 2560.503-1(g). The notification must include “(iii) A description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary[.]” § 2560.503-1(g)(iii). 16 limitation in the initial denial letter of September 10, 2003, which quoted the Plan provision concerning the limitation for mental or nervous disorders, and, while represented by counsel, he had the opportunity to present additional records specifically addressing that issue in pursuing his appeal. Reliance’s failure to cite the mental illness limitation does not demonstrate the Reliance acted under a conflict of interest. The district court also concluded that Reliance’s use of Dr. Hauptman10 to conduct a records review was further evidence of bias. The district court relied on Conrad v. Reliance Standard Life Insurance Co., 292 F.Supp.2d 233 (D. Mass. 2003), in which the court found that Reliance’s denial of benefits was arbitrary and capricious because Dr. Hauptman’s report indicated a bias on his part in favor of rejecting the plaintiff’s claim. See Gunn II, 592 F.Supp.2d at 1262-63. Dr. Hauptman has been retained by Reliance on numerous occasions to conduct records reviews. Although it is appropriate to consider Dr. Hauptman’s longstanding relationship with Reliance in weighing the degree of any conflict of interest attached to his opinion, that relationship alone does not mandate a finding that Reliance should have completely disregarded his opinion. 10 Gunn argues that Dr. Hauptman, a gastroenterologist, was not qualified to express an opinion in this case. However, Dr. Hauptman is also board-certified in internal medicine. In that capacity, he was qualified to analyze treatment records concerning Gunn’s multiple sclerosis. 17 In commenting on Dr. Hauptman’s review of the records in the instant case, the district court noted that in the assessment section of his report, Dr. Hauptman did not refer to Dr. Brandes’s October 27, 2003, Comprehensive Neurological Evaluation, which noted that Gunn was “totally disabled as a result of multiple sclerosis,”11 but instead focused on Dr. Brandes’s treatment notes of December 23, 2003, where Dr. Brandes stated that Gunn’s multiple sclerosis was “mild.” Gunn II, 592 F.Supp.2d at 1262 n. 12. However, Dr. Hauptman devoted two paragraphs in his report to a discussion of Dr. Brandes’s October 27th evaluation, and specifically noted Dr. Brandes’s statement that Gunn was totally disabled as a result of the multiple sclerosis and due to his cognitive dysfunction and fatigue; thus, he clearly considered the entirety of Dr. Brandes’s report and diagnosis. The fact that Dr. Hauptman relied on Dr. Brandes’s December 23, 2003, assessment that Gunn’s multiple sclerosis was “mild” in concluding that Gunn’s disability was due to his psychiatric illness was not unreasonable in light of the fact that Dr. Brandes himself diagnosed Gunn as having a relapsing-remitting form of multiple 11 Dr. Brandes actually stated in his October 27, 2003, report that “the patient is totally disabled as a result of his multiple sclerosis, due to his cognitive dysfunction, and fatigue, both of these will preclude inability [sic] to work under any situation.” He further indicated that Gunn’s cognitive dysfunction was secondary to relapsingremitting multiple sclerosis and/or severe depression, thus suggesting that Gunn’s depressive illness was possibly a contributing cause of his cognitive dysfunction and inability to work. 18 sclerosis as well as severe depression. The district court also criticized Dr. Hauptman for voicing his agreement with Dr. Orfuss’s conclusions even though he was not specifically asked to comment on the opinion of Dr. Orfuss. Id. However, Reliance did not specifically ask Dr. Hauptman to comment on any of the medical opinions contained in Gunn’s records; the memo simply stated, “Please review & advise if MS alone is impairing.” Dr. Hauptman did not limit his comments to the report of Dr. Orfuss, but also commented on the conclusions of Gunn’s treating physicians in the assessment portion of his report. Since the report of Dr. Orfuss was among the records Dr. Hauptman was given to review, the comment was appropriate.12 Finally, the district court cited as further evidence of bias the fact that “Reliance accepted whole-heartedly the opinions of its own physicians, that plaintiff’s disability was caused 99% by his depression and only 1% by his multiple sclerosis, in spite of all medical evidence to the contrary offered by plaintiff.” Gunn II, 592 F.Supp.2d at 1263. First, there is no evidence that Dr. Orfuss, who performed the independent medical examination, was a Reliance physician or that he ever performed any other evaluation for Reliance. Second, 12 We note that even if the opinion of Dr. Hauptman is disregarded entirely, the record is still sufficient to support Reliance’s conclusion that Gunn was disabled because of mental illness, not because of his multiple sclerosis. 19 Reliance did not ignore the evidence that Gunn suffered from multiple sclerosis. Rather, the issue was whether Gunn met the criteria for disability if only his multiple sclerosis symptoms were considered. The district court’s comment implies that Gunn’s medical evidence on that point was unequivocal, when in fact it was not; Gunn’s physicians never clearly addressed that question in their treatment notes or reports. The fact that Reliance ultimately accepted the opinions of Drs. Orfuss and Hauptman, who concluded that Gunn’s disability was attributable to his mental illness, severe depression, rather than to multiple sclerosis, does not establish that Reliance simply ignored the evidence relating to his multiple sclerosis or reached a biased result. See Jordan v. Northrop Grumman Corp. Welfare Benefit Plan, 370 F.3d 869, 878 (9th Cir. 2004), overruled on other grounds, Abatie v. Atta Health & Life Ins. Co., 458 F.3d 955, 969 (9th Cir. 2006). The reports of Drs. Orfuss and Hauptman as well as Reliance’s decision letters indicate that they did consider the medical records of Gunn’s treating physicians. The fact that Reliance ultimately accepted the opinions of Drs. Orfuss and Hauptman in regard to whether Gunn’s multiple sclerosis symptoms were sufficient in themselves to result in total disability is not sufficient to show bias. See Black & Decker Disability Plan, 538 U.S. at 825. 20 After considering all of the circumstances relied on by the district court as evidence of a conflict of interest or bias on the part of Reliance, we conclude that the district court placed undue weight on these factors. The circumstances cited in support of an alleged conflict of interest on the part of Reliance are insufficient to undermine the reasonableness of Reliance’s decision based on medical evidence in the record or to render that decision an abuse of discretion.