Opinion ID: 4533880
Heading Depth: 2
Heading Rank: 2

Heading: Review of Liberty’s Decision

Text: The district court initially ruled that it should review for abuse of discretion (it had originally decided that the Colorado discretion-denying statute did not apply because it postdated the Policy) and upheld the decision by Liberty. But on a motion for reconsideration by Ellis, it changed its mind regarding applicability of the Colorado statute, exercised de novo review, and ruled in favor of Ellis. Its first decision was 31 correct. We agree that under an abuse-of-discretion standard, Liberty’s denial of benefits must be affirmed. We uphold a plan administrator’s decision under the abuse-of-discretion standard “so long as it is predicated on a reasoned basis.” Adamson v. Unum Life Ins. Co. of Am., 455 F.3d 1209, 1212 (10th Cir. 2006). We ask only that the decision “reside[] somewhere on a continuum of reasonableness—even if on the low end.” Id. at 1212 (internal quotation marks omitted). “Plan administrators, of course, may not arbitrarily refuse to credit a claimant's reliable evidence, including the opinions of a treating physician,” Black & Decker Disability Plan v. Nord, 538 U.S. 822, 834 (2003), but a benefits decision can be reasonable even when the insurer receives evidence contrary to the evidence it relies on, see Holcomb v. Unum Life Ins. Co. of Am., 578 F.3d 1187, 1193–94 (10th Cir. 2009). “[C]ourts have no warrant to require administrators automatically to accord special weight to the opinions of a claimant’s physician; nor may courts impose on plan administrators a discrete burden of explanation when they credit reliable evidence that conflicts with a treating physician’s evaluation.” Black & Decker, 538 U.S. at 834. Ellis contends that under the Supreme Court’s decision in Metropolitan Life Insurance Co. v. Glenn, 554 U.S. 105 (2008), we must use a less deferential standard when, as here, the administrator operates under a conflict of interest by both paying out benefits and adjudicating claims. But Glenn explicitly rejected this proposition, saying that “[t]rust law continues to apply a deferential standard of review to the discretionary decisionmaking of a conflicted trustee.” Id. at 115. It instead instructed that “the 32 reviewing judge . . . take account of the conflict when determining whether the trustee, substantively or procedurally, has abused his discretion.” Id.; see id. at 115–17. “[C]onflicts are but one factor among many that a reviewing judge must take into account.” Id. at 116. Indeed, we have relied on Glenn to explain that the effect of a conflict is case-specific and “‘prove[s] less important (perhaps to the vanishing point) where the administrator has taken active steps to reduce potential bias and to promote accuracy,’” including by utilizing independent physicians. Holcomb, 578 F.3d at 1193 (quoting Glenn, 554 U.S. at 117 (2008)). Under the Policy a claimant cannot receive long-term disability benefits without proof of disability arising from an injury or sickness that renders the claimant unable to perform the duties of any occupation. We hold that Liberty did not abuse its discretion in deciding that Ellis had not established such a disability in light of the evidence presented to it. Ellis obtained support for his claim of neurological impairment from several sources. First, in June 2012 he consulted with Dr. Zacharias, a neurologist, who noted Ellis’s complaints of “poor concentration, dizziness, slowing of physical and mental skills,” and recommended cognitive and physical therapy. Aplt. App., Vol. I at 268–69. He also wrote, though, that he “did not do detailed neuropsychological testing,” and that Ellis was “alert and attentive,” had no “evidence of a primary neuromuscular disease,” and had an “[u]nremarkable brain MRI.” Id. at 269. In August 2012, Dr. Zacharias wrote in a follow-up report: “I am still not sure what accounts for Michael’s condition. My best assessment would be something happened with hypoxic injury with either his 33 syncopal episode or his pulmonary embolism.” Id. at 265. He noted Ellis was progressing with therapy, “but still struggles significantly.” Id. at 265. Completing a restrictions form sent by Liberty in May 2013, Dr. Zacharias provided a diagnosis for Ellis of “hypoxic/ischemic encephalopathy” and in response to a question asking for a description of his “physical, mental and/or cognitive restrictions,” he directed Liberty “to see neuropsych testing that supports his impairment.” Id. at 239. Also in May 2013, Ellis’s primary-care physician, Dr. Hadley, reported in response to a Liberty restrictions form that Ellis suffered from “cognitive impairment from hypoxic encephalopathy.” Id. at 192 (internal quotation marks omitted). In April 2013 one of Liberty’s consulting neuropsychologists, Dr. Crouch, opined that Ellis “would likely be precluded from performing the usual duties of his job, regardless of accommodations provided.” Id. at 187. He also commented that Ellis’s test results from Dr. Helffenstein’s evaluation appeared “valid/reliable.” Id. at 187. In September 2013, Dr. Crouch reaffirmed that the available records “provide reasonable support for significant impairment,” although he suggested that Ellis be reevaluated. Id. at 189. Ellis has relied most heavily on the conclusions of Dr. Helffenstein, a neuropsychologist, who first tested Ellis in August and September 2012. According to his report, “The testing identified significant cognitive deficits suggesting bilateral frontal and bilateral temporal involvement. The pattern is consistent with cerebral hypoxia. There is absolutely no way Michael could do his job at this time from a cognitive standpoint.” Aplee. Supp. App., Vol. II at 578 (internal quotation marks omitted). He 34 also opined “within reasonable neuropsychological probability that the cognitive deficits noted on testing related directly and solely to the medical event that occurred on February 1, 2012. It seems reasonable that an episode of cerebral hypoxia did occur during this event.” Aplt. App., Vol. I at 262. Dr. Helffenstein reevaluated Ellis in May 2014. He reported that Ellis “demonstrated . . . notable improvement on testing from my first evaluation with him to my re-evaluation,” id. at 144, but maintained that he was “totally and permanently disabled from competitive employment,” id. at 145. Finally, Ellis obtained a SPECT scan in May 2014, and the neurologist interpreting the scan concluded: “The nature, location, and pattern of these abnormalities is most consistent with the scientific literature pertaining to a diffuse, toxic/hypoxic encephalopathic process and the patient’s clinical history which was received after the blind review.” Id. at 220. But Liberty had sound reasons not to adopt the above views. Dr. Hadley, Ellis’s primary care physician, does not specialize in neurology or neuropsychology, and was likely just deferring to the views of specialists. And Dr. Crouch, a consulting neuropsychologist for Liberty, consistently expressed the view that a 24-second heart stoppage could not cause neurological injury, and he came to have doubts whether Ellis suffered cognitive impairments. In September 2013 he had suggested a reevaluation and after receiving Dr. Gant’s evaluation of Ellis in October, Dr. Crouch opined that the results “are insufficient to support the presence of valid/reliable impairment” and that “results from multiple measures of response bias were suboptimal, indicating that 35 observed abnormal test results were ‘related to the patient’s desire to obtain disability benefits.’” Id. at 194 (internal quotation marks omitted). As for Dr. Zacharias, he admitted that he did not conduct detailed neuropsychological testing, and the brain MRI was “[u]nremarkable.” Id. at 269. The restrictions form he completed for Liberty included no new data and simply directed Liberty to see prior testing. Further, the persuasiveness of his conclusions in support of Ellis is diminished by his adoption of the theory that Ellis’s claimed deficits may have been caused by cerebral hypoxia stemming from his 24-second heart stoppage, as this was deemed medically implausible by essentially every other physician to review the case. The SPECT scan is obviously objective data, but the relevance could reasonably be questioned by Liberty. Dr. Belliveau expressed doubts: Scientific studies about the utility of SPECT procedures during evaluation of dementia or brain injury due to trauma may not necessarily be applicable to evaluation of brain injury due to hypoxic-ischemic events, and . . . the cognitive and psychological assessment methods used during neuropsychological examination represent a more direct process of determining the examinee’s functional status. Id. at 110. Although Ellis submitted to Liberty a number of medical-journal articles and court documents discussing the utility of SPECT scans, these focused almost exclusively on evaluating traumatic brain injury—without any mention of their utility in assessing hypoxic injury. And Ellis has not alleged that his disability was caused by physical trauma to the brain. 36 There remains Dr. Helffenstein. Liberty could reasonably have questioned his objectivity. He was hired by Ellis’s attorney to evaluate Ellis; and his initial report in November 2012 appears to have been a bit overenthusiastic. Although he had been advised that the duration of Ellis’s cardiac standstill had been only 24 seconds, the report stated that Ellis’s “cognitive deficits noted on testing relate directly and solely to the medical event that occurred on February 1, 2012. It seems reasonable that an episode of cerebral hypoxia did occur during this event.” Id. at 262 (emphasis added). By August 2013 he had walked back this theory, stating that he would “totally concur” with the assessment that “it is highly unlikely that the reported 24-second period of asystole on February 1, 2012 would be the cause of [Ellis’s] cognitive complaints.” Id. at 228 (internal quotation marks omitted). He proposed instead that Ellis’s “cognitive dysfunction most likely relates to a more extended period of cerebral hypoxia,” but failed to identify how or when such an event might have occurred. Id. His final report in July 2014 then broadened his original hypothesis, suggesting that Ellis “experience[d] some type of neurological event (likely a hypoxic episode or episodes) during the early part of February of 2012 related to his various medical conditions.” Id. at 144. But he added: “I am not sure that any physician or neuropsychologist could point to a specific time or event that resulted in Mr. Ellis’[s] injury but, at this point, I am absolutely convinced that such an injury did occur.” Id. Most importantly, two neuropsychologists challenged Dr. Helffenstein’s methods and the validity of his results. Dr. Belliveau, Liberty’s consulting neuropsychologist, questioned the results of Dr. Helffenstein’s testing because of significant evidence of 37 symptom overreporting and other evidence of invalidity. He noted that tests differ in their ability to detect insufficient effort and that Ellis had passed the less sensitive tests but failed those that are more sensitive to insufficient effort. In light of the “multiple findings of invalid neuropsychological test data,” Dr. Belliveau concluded that the “available medical record documentation” in Ellis’s file “represents insufficient support for the conclusion that the claimant has permanent cognitive impairment due to hypoxicischemic encephalopathy.” Id. at 124. Similarly, Dr. Gant, the independent neuropsychologist Liberty retained from an outside vendor, criticized Dr. Helffenstein for using outdated and inadequate tests. He conducted his own testing and evaluation but decided that many of the test scores were invalid. He reported: “It is unlikely that [Ellis] provided valid effort during this examination. Clear evidence of symptom exaggeration and suboptimal effort was identified.” Id. at 202. In particular, he observed: Ellis reported an unusual and elevated degree of neurological complaints which are likely to be vague and illogical. . . . [Other tests] indicated that the degree of neurological impairment reported by . . . Ellis was highly atypical and illogical. Such a presentation includes symptoms that are illogical or inconsistent with symptoms of a bona fide neurologic disorder or they occur very rarely in neurologically impaired patients. Id. at 203–04. He concluded that “within reasonable medical probability [Ellis] has not suffered cognitive impairment related to the asystole event which lasted 24 seconds on February 1, 2012,” and that “elements of secondary gain and/or impairment related to somatic exaggeration is responsible for [Ellis’s] presentation.” Id. at 196. 38 On this record we cannot say that Liberty’s denial of benefits was an abuse of discretion. Ellis criticizes several aspects of Liberty’s decision-making. Although some of the criticism has weight, a decision is not arbitrary and capricious just because some may be persuaded otherwise. Ellis first asserts that Liberty improperly relied on the conclusions of its hired reviewers despite flaws in their testing methods and reports. He argues that Liberty failed to credit Dr. Helffenstein’s claim that fatigue during testing could alone account for Ellis’s “sub optimal performance on symptom validity measures” during Dr. Gant’s testing. Id. at 135. But Dr. Helffenstein does not explain how fatigue could cause the apparently intentionally dishonest reporting observed by Dr. Gant. And even though Ellis was provided breaks during his 2012 evaluation with Dr. Helffenstein, Dr. Belliveau expressed doubts as to the validity of the scores obtained during that evaluation as well —contrary to the suggestion that fatigue fully accounted for the symptom exaggeration and other measures of invalidity that Dr. Gant observed. Ellis also claims that Dr. Gant did not review Dr. Helffenstein’s raw data, and that Dr. Crouch, who did, opined that Dr. Helffenstein’s test findings were valid and reliable. But Dr. Gant was still able to criticize the testing on the ground that the tests were out of date and that “inadequate testing was done to evaluate patient effort and test validity”; and he suggested that the raw data be obtained. Id. at 202. In any event, Dr. Belliveau did review that data and, like Dr. Gant, criticized Dr. Helffenstein’s results and methods, not only stating that Dr. Helffenstein used outdated tests but also that his data indicated symptom overreporting. And Dr. Crouch agreed with Dr. Gant’s conclusion that Ellis had not been candid in Dr. Gant’s testing. 39 Ellis criticizes Liberty’s instructions for conducting a July 2013 vocational report. The vocational case manager who submitted the report was asked “to base [the] report on a presumed sedentary work capacity, and not to include any cognitive and/or mental restrictions and limitations” in her assessment. Aplee. Supp. App., Vol. II at 455. Ellis argues that these instructions are “clear[] evidence that Liberty never intended to provide Ellis with a full and fair review of his claim, but instead, conducted a result-oriented investigation solely intended to terminate his benefits.” Aplee. Br. at 49. The argument is not totally off-the-wall, but it is a stretch. The record shows that the vocational report was for “an exploratory TSA [transferable skills analysis],” Aplee. Supp. App., Vol. I at 28, which would be necessary because in two months Mr. Ellis’s eligibility for disability would require inability to perform the “material and substantial duties of any occupation” rather than “of his own occupation,” Aplt. App. at 296 (emphasis added). That would not be a nefarious purpose for conducting the limited evaluation, particularly since Liberty was at the same time pursuing the medical basis of the alleged cognitive deficits and would thus later be able to assess Ellis’s ability to perform the alternate occupations identified in the vocational report in light of any mental limitations. Ellis complains that Liberty instructed that Dr. Crouch, who had expressed some support for Ellis’s claim, should not be assigned to review the file on internal appeal. But the reason given for the instruction was that “he previously handled the file.” Aplee. Supp. App., Vol. I at 55. On its face, it seems reasonable, and apparently legally mandated, to have an appeal handled by persons other than those who handled the initial decision. See 29 C.F.R. § 2560.503–1(h)(3)(v). 40 Finally, Ellis claims that Liberty ignored other evidence demonstrating he was cognitively disabled, namely (1) Liberty’s surveillance of him, (2) his Social Security Disability Insurance (SSDI) award, and (3) a letter from his speech therapist and other clinical notes from various providers. But the record rebuts this assertion. To begin with, Drs. Belliveau, Crouch, and Gant all reviewed the surveillance reports as part of their consideration of Ellis’s claim. In particular, Dr. Crouch remarked that there were “[n]o cognitive [symptoms] documented” in the first surveillance report, Aplt. App., Vol. I at 182, and “[n]o abnormalities noted in limited visual contact” in the second report, id. at 191, diminishing their relevance to Ellis’s claim of cognitive impairments. Liberty also acknowledged the SSDI award. Its letter denying benefits stated that it was “aware [of] and fully considered” the December 2013 ruling of the Social Security Administration (SSA) granting the award. It explained, though, that its decision was “based upon updated medical records and testing, and different medical and vocational reviews that would not have been considered by the SSA in December 2013,” and that the SSA requirements are not the same as those in the Policy. Id. at 105. Ellis’s SSDI application was submitted before Dr. Gant’s evaluation and report and Dr. Belliveau’s review, and there is no indication that the SSA considered the later reports. Similarly, the record indicates that all the clinical notes were reviewed by Liberty experts. The experts did not disregard them; it is just that they found that the record considered as a whole was inadequate to support Ellis’s claim. Dr. Belliveau explicitly stated his conclusion was based on “[t]he available medical record documentation, 41 including the scope, severity, and persistence of the claimant’s reported symptoms; observations of his treatment providers; [and] multiple findings of invalid neuropsychological test data.” Id. at 124 (emphasis added). Dr. Gant similarly arrived at his opinion “[a]fter reviewing the medical records, the report completed by Dr. Helffenstein, and completing [his] own evaluation.” Id. at 210. Again, the existence of evidence supporting Ellis’s claim does not render a denial of benefits unreasonable. See Holcomb, 578 F.3d at 1193–94 (upholding benefits denial even though insurer “had received a large volume of reports, letters, imaging studies, and exams that were not entirely consistent”). In sum, Liberty relied on two expert neuropsychologists, Drs. Gant and Belliveau, who both concluded that there was insufficient evidence from Ellis’s medical records and test data to support his claim of cognitive deficits. Because the record shows Liberty and the experts it retained considered all the pertinent evidence submitted by Ellis and that Liberty reasonably gave less weight to much of Ellis’s evidence, we cannot say that Liberty abused its discretion in denying Ellis’s claim for benefits.