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DUBOIS v. PAUL REVERE LIFE INSURANCE COMPANY

November 5, 2004.

JAMES DUBOIS, Plaintiff,
v.
THE PAUL REVERE LIFE INSURANCE COMPANY, Defendant.



The opinion of the court was delivered by: WILLIAM HART, Senior District Judge

MEMORANDUM OPINION AND ORDER

Plaintiff James Dubois worked as a machine shop supervisor for Sloan Valve Company, a manufacturer of plumbing equipment. Sloan has a long term disability plan which is administered by defendant The Paul Revere Life Insurance Company (the "Revere Plan"). In late 1994, plaintiff was diagnosed as having a herniated disk. From January 1995 through April 1999, plaintiff had four surgeries on his spinal column. From some time after 1994 until September 23, 1999, plaintiff received temporary total disability benefits through Sloan's workers' compensation program. Effective February 9, 1998, the same date on which he had his first spinal fusion, plaintiff was found qualified for social security disability benefits. In January 2000, plaintiff applied for disability benefits under the Revere Plan, claiming to be disabled due to a lower back injury since February 9, 1998. Under a reservation of right and taking into account an applicable elimination period, plaintiff was paid disability benefits effective July 9, 1998. In a determination dated April 5, 2001, however, defendant found that plaintiff was no longer directly disabled due to his back problems, but was then prevented from working due to an addiction to prescription narcotics prescribed for pain related to his back problems. Benefits were discontinued, effective April 9, 2001, based on plaintiff having exceeded the 24-month limit for a disability caused by drug abuse. Two subsequent appeals were denied.

The parties agree that plaintiff has exhausted his administrative remedies. They also agree that the Revere Plan is an employee benefit plan to which the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. ยง 1001 et seq., applies. Further, the parties agree that the Revere Plan accords defendant discretion in determining who is entitled to benefits under the Plan and therefore plaintiff's challenge to defendant's determination is subject to an "arbitrary and capricious" standard of review. While plaintiff continues to disagree with the determination that his back problems themselves do not prevent him from working and notes that there was evidence supporting his claim, he does not contend that defendant's contrary finding was arbitrary and capricious. Instead, plaintiff contends that defendant's application of the Revere Plan's drug abuse limitation was arbitrary and capricious.

  Arbitrary and capricious review

 
is, of course, a deferential standard of review. Under the arbitrary and capricious standard, a plan administrator's decision should not be overturned as long as (1) "it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome," (2) the decision "is based on a reasonable explanation of relevant plan documents," or (3) the administrator "has based its decision on a consideration of the relevant factors that encompass the important aspects of the problem." Exbom v. Central States, Southeast & Southwest Areas Health and Welfare Fund, 900 F.2d 1138, 1142-43 (7th Cir. 1990) (citations omitted). Nevertheless, "[d]eferential review is not no review," and "deference need not be abject." Gallo v. Amoco Corp., 102 F.3d 918, 922 (7th Cir. 1996). In some cases, the plain language or structure of the plan or simple common sense will require the court to pronounce an administrator's determination arbitrary and capricious. Id.
Hess v. Hartford Life & Accident Insurance Co., 274 F.3d 456, 461 (7th Cir. 2001). The decision of the administrator will not be upheld where there is an absence of reasoning supporting the determination. Hackett v. Xerox Corp. Long-Term Disability Income Plan, 315 F.3d 771, 774-75 (7th Cir. 2003). The administrator "must articulate a rational connection between the facts found, the issue to be decided, and the choice made." Dabertin v. HCR Manor Care, Inc., 373 F.3d 822, 828 (7th Cir. 2004). Also, a determination may be arbitrary and capricious where the administrator has disregarded the submissions of the claimant. Hess, 274 F.3d at 463.
  Under arbitrary and capricious review, review of a plan's decision is generally limited to evidence or information that was before the reviewing body. Id. at 462; Perlman v. Swiss Bank Corp. Comprehensive Disability Protection Plan, 195 F.3d 975, 982 (7th Cir. 1999); Bahnaman v. Lucent Technologies, Inc., 219 F. Supp. 2d 921, 925 (N.D. Ill. 2002). Although defendant's motion is a summary judgment motion, actually before the court is administrative review of defendant's decisions with the administrative records being the essential uncontested fact. Evidence that was outside the administrative record is only appropriate to consider if it goes to procedural issues such as exhaustion, in which case the usual summary judgment rules would be applied in determining if there are any material factual disputes. See Wilkins v. Baptist Healthcare System, Inc., 150 F.3d 609, 619 (6th Cir. 1998); Shyman v. UNUM Life Insurance Co. of America, 2004 WL 609280 *2 (N.D. Ill. March 25, 2004); Sisto v. Ameritech Sickness & Accident Disability Benefit Plan, 2003 WL 22472022 *2 (N.D. Ill. Oct. 31, 2003); Eriksen v. Metropolitan Life Insurance Co., 39 F. Supp. 2d 864, 866 n. 2 (E.D. Mich. 1999). Cf. Perlman, 195 F.3d at 982 (outside facts could be considered if a Plan was accused of not doing what it said it did). Plaintiff claims he is disabled from performing his work as a machine shop supervisor. The Revere Plan defines total disability from performing the employee's occupation as follows:
Totally disabled from your own occupation or total disability from your own occupation means:
1. because of injury or sickness, you cannot perform the important duties of your own occupation;
2. you are receiving Doctor's Care. We will waive this requirement if we receive written proof acceptable to us that further Doctor's Care would be of no benefit to you; and
3. you do not work at all.
Def. Exh. B at 9.

  The Revere Plan includes the following limitation on disability benefits.

 
For any disability which is caused by a psychiatric disorder, alcoholism, drug abuse or the use of any drug other than one administered on a doctor's advice, benefits are payable for up to twenty-four months whether or not you are hospital confined. After twenty-four months, subject to all other policy provisions, we pay benefits only if you continue to be hospital confined due to the disability, and for up to three months after the date you are no longer confined. . . .
Id. at 26. The Plan defines "hospital confined" and "psychiatric disorder," id., but "drug abuse" is not further defined.
  Defendant's April 5, 2001 determination letter (Def. Exh. C at 807-05) accepts the findings contained in the lengthy report of independent medical examiner Dr. J.S. Player, which had also been reviewed and accepted by defendant's medical department. The determination letter notes Dr. Player's findings that plaintiff inconsistently reported pain and "demonstrated symptom magnification and overstatement of pain." Def. Exh. C at 807. It was found that plaintiff had no physical limitation preventing him from performing sedentary or light duty with a 25-pound weight lifting restriction. It was further found:
Since you are able to lift up to 25 pounds, you are capable, from a physical standpoint, of performing your occupation as it only requires lifting up to 20 pounds occasionally. However, Dr. Player reports that, "the examinee admitted that he has ingested Vicodin on a daily basis at a frequency of 6-8 to 12 pills per day since 1995. In this regard, the examinee is addicted to this narcotic analgesic and is currently substituting methadone for his hydrocodone addiction. The examinee should not return to work until he has entered a rehabilitation program and has resolved his addiction to narcotics. His addiction to narcotics is the primary reason for his failure to recover."
Id. at 806.
  After quoting the language of the 24-month limitation, the April 2001 determination concluded:
Dr. Player has reported that the reason you are unable to return to work is due to your narcotic addiction. You have been paid benefits for a period of July 9, 1998 to April 9, 2001 under reservation of rights. Therefore, the twenty four month limitation as stated above expired on July 9, 2000. Since you have not been hospital confined as stated in the policy provision above, the benefit period for disability due to drug abuse has been exhausted, and as such, no further benefits are payable.
Id. at 805.
  Plaintiff was advised of his right to seek further review and appeal, including the right to comment on the decision and/or submit additional documentation. Still proceeding pro se, plaintiff timely sought review and an appeal. He submitted additional materials from his treating physicians and questioned accepting Dr. Player's opinion based on a single 25-minute examination instead of the opinions of physicians who had examined plaintiff numerous times and plaintiff's own subjective testimony as to his pain. Regarding his use of pain medication, plaintiff stated:
First and foremost let me address Dr. Player's opinion of my medication and usage of. I strictly abide by my Doctors' recommendations as they pertain to the dosage and type of medication. As if dealing with my pain is not enough, use of pain medication has serious long term effects to internal organs such as my liver, which must also be closely monitored. I have had to alternate medication types to minimize such long term damages. In most cases, if there has been ANY deviation, it has been MY decision to request my Doctor to reduce the recommended dosage or, in some cases, to completely abandon the particular medication because of its adverse effects on my mental and physical well being. To be honest, some times I am not sure which are the lesser of the two evils. My usage of medications are NOT for recreational pleasures.
Id. at 825 (some typographical or grammatical errors have been corrected without notation).

  The author of the April 2001 determination letter did not change her decision on further review, so the case was forwarded to Appeals. See id. at 826. In a determination letter dated October 3, 2001 (id. at 834-32), the initial decision to terminate benefits was upheld on appeal. The October 2001 determination acknowledges that some evidence supports plaintiff's contentions. However, it explains that, based on the review of defendant's medical consultant, the record supported that, although plaintiff had back problems, he was still able to perform light work. See id. at 833-32. The October 2001 determination mischaracterizes the April 2001 decision as having found that plaintiff was not disabled from performing the duties of his occupation. Id. at 834. Instead, the April 2001 determination had adopted Dr. Player's finding that plaintiff could not perform his job duties because of his narcotics addiction and denied benefits based on exhausting the 24-month limitation, not based on being capable of performing job duties. Moreover, although the issue was raised in plaintiff's appeal, the October 2001 decision did not, in any way, address the issue of the use of narcotics. It did not, in any way, acknowledge that, although Dr. Player found no physical limitation preventing plaintiff from working, he also found that plaintiff could not work due to the use of narcotics. The October 2001 determination offered plaintiff the opportunity to submit further documentation and stated that additional information would be requested from plaintiff's treating physicians, including the opportunity to comment on Dr. Player's report.

  Both treating physicians submitted some additional materials that were considered in a second appellate determination dated November 16, 2001 (id. at 853-52). The additional materials were provided to a board-certified physiatrist for review. The second appellate determination makes passing reference to the treating physicians referring to narcotics use and other medical evidence. It concludes:
. . . This information did not alter our previous conclusion that your condition is not of such a severe nature that you would be prevented from performing sedentary to light exertional activities with a twenty (25) [sic] pound lifting restriction. Light exertional activity was previously defined in the enclosed notice dated October 3, 2001. Your occupation as a Shop Foreman is considered a light occupation.
  In sum, it has been rightly determined that you are not disabled as defined by the policy from performing the duties of your occupation as a Machine Shop Foreman. Consequently, no further benefits are due or payable on this claim. . . . Id. at 852. The November 16, 2001 determination does not expressly address or discuss the narcotics issue.

  The issue presently raised in this case is not whether there was sufficient evidence supporting that plaintiff's back problems do not physically restrict him from performing his occupation. The issues presently raised by plaintiff are whether defendant adequately considered plaintiff's use of prescribed narcotics and/or acted reasonably in construing and applying the 24-month, drug-abuse limitation. The initial April 2001 determination found that plaintiff was unable to perform his former occupation because of a "narcotic addiction" and implicitly determines, without any express discussion, that this addiction constitutes "drug abuse" as that term is used in the 24-month limitation provision. On review and appeal, plaintiff challenged the determination that his use of prescribed narcotics constituted drug abuse subject to the limitation.*fn1 However, neither of the appellate determinations addresses the narcotics issue. Additionally, although the appellate determinations recite that they are upholding the initial April 2001 determination, they incorrectly ...


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