United States District Court, N.D. Illinois, Eastern Division
For Steve Zaccone, Plaintiff: David A. Bryant, LEAD ATTORNEY, Jennifer Marie Danish, Bryant Legal Group PC, Chicago , IL; R. Mark Maritote, Law Office of R. Mark Maritote, Bloomingdale , IL.
For Standard Insurance Company, Defendant: W. Sebastian von Schleicher, LEAD ATTORNEY, Jacqueline J. Herring, Smith, von Schleicher & Associates, Chicago , IL; William R. Irwin, LEAD ATTORNEY, Segal McCambridge Singer & Mahoney, Ltd., Chicago , IL.
MEMORANDUM OPINION AND ORDER
Jeffrey Cole, Magistrate
From 1990 to 2007, Steve Zaccone worked for Tempel Steel as a business support specialist. (Administrative Record (" R." ) 00387). As a Tempel employee, he received both short-term and long-term disability insurance coverage through Standard Life Insurance Company (" Standard" ). (R. 00382, 00494). On September 1, 2006, Mr. Zaccone stopped working. He had a history of back problems and, as it turned out, he did not return to work until February 13, 2007. Even then, he was only able to work part time. (R. 00378, 00479). By October 5, 2007, he had ceased work completely. (R. 00378, 00479). Standard determined that he was entitled to disability benefits but, as it turned out,
only for a twelve-month period. In reaching this conclusion, Standard determined that Mr. Zaccone's back impairment -- and the medical evidence he submitted to establish it -- put him in the category of " Other Limited Conditions" as defined in the Group Plan. Mr. Zaccone disagrees with that result and filed suit hoping to overturn it.
The parties briefed the question of what standard applied to the review of Standard's benefits determination and, after considering their submissions, I concluded that the de novo standard applies. Zaccone v. Standard Life Ins. Co., 2013 WL 1849515 (N.D.Ill. 2013). In such an instance, the court " must come to an independent decision on both the legal and factual issues that form the basis of the claim." Diaz v. Prudential Ins. Co. of Am., 499 F.3d 640, 643 (7th Cir.2007); Marantz v. Permanente Medical Group, Inc. Long Term Disability Plan, 687 F.3d 320, 328 (7th Cir. 2012). The court is, therefore, not really " reviewing" the insurance provider's determination; it is making an independent decision about the employee's entitlement to benefits. Diaz, 499 F.3d at 643; Marantz, 687 F.3d at 328. Of course, in doing so, the court must follow the terms of the insurance policy. Sperandeo v. Lorillard Tobacco Co., Inc., 460 F.3d 866, 872 (7th Cir. 2006).
The only issue here is whether Mr. Zaccone suffers from an " Other Limited Condition" as defined by the Group Plan. (Dkt. # 102, ¶ 86). If he does, he is only entitled to benefits for twelve months -- benefits he has already received. The Group Plan states:
Payment of LTD Benefits is limited to 12 months during your entire lifetime for a Disability caused or contributed to by any one or more of the following, or medical or surgical treatment of one of the following:
3. Other Limited Conditions.
Other Limited Conditions means...chronic pain conditions...arthritis, diseases or disorders of the cervical thoracic, or lumbosacral back and its surrounding soft tissue.... However, Other Limited Conditions does not include...herniated discs with neurological abnormalities that are documented by electromyogram and computerized tomography or magnetic resonance imaging, scoliosis, radiculopathies that are documented by electromyogram, spondylolisthesis, grade II or higher, myelopathies and myelitis, traumatic spinal cord necrosis, osteoporosis, discitis, Paget's disease.
(Administrative Record (" R." ) 00509-00510). Mr. Zaccone does have a back impairment, but under the applicable provision, the question is whether he has a disability caused or contributed (1) herniated discs with neurological abnormalities that are documented by electromyogram and computerized tomography or magnetic resonance imaging; and/or (2) radiculopathies that are documented by electromyogram.
Generally speaking, the party seeking benefits bears the burden of proving his entitlement to benefits. Ruttenberg v. U.S. Life Ins. Co. in City of New York, a subsidiary of American General Corp., 413 F.3d 652, 663 (7th Cir. 2005). That's the case here as well, for although an insurer like Standard has the burden of proving an exclusion applies -- here, the " Other Limited Conditions" provision -- the insured, in turn, has the burden of proving that an exception to the exclusion restores coverage. Santa's Best Craft, LLC v. St. Paul Fire and Marine Ins. Co., 611 F.3d 339, 347 (7th Cir. 2010).
The Administrative Record
From 1990 to 2007, Mr. Zaccone worked for Tempel Steel as a business support specialist. (Administrative Record (" R." ) 00387). As a Tempel employee, he received both short-term and long-term disability insurance coverage through Standard Life Insurance Company (" Standard" ). (R. 00382, 00494). On September 1, 2006, Mr. Zaccone stopped working. He had a history of back problems and, as it turned out, he did not return to work until February 13, 2007. Even then, he was only able to work part time. (R. 00378, 00479). By October 5, 2007, he had ceased work completely. (R. 00378, 00479).
Mr. Zaccone received short-term disability benefits at 100% of his salary from September 1, 2006, through October 8, 2007. (R. 00378, 00382). On October 9, 2007, Tempel Steel submitted Zaccone's long-term disability benefits application to Standard. (R. 00376). The application included a statement from Mr. Zaccone and reports from two treating physicians. Mr. Zaccone described his injury as " chronic back pain and neuropathy, failed back syndrome" caused by " degenerative disc problem" and perhaps a December 1991 car accident. (R. 00385-86).
In his report, Dr. Manganelli listed Mr. Zaccone's primary diagnosis as " failed back syndrome," his secondary diagnosis as " peripheral painfull [sic] neuropathy," and his " other diagnoses" as " failed neck syndrome." (R. 00290). Dr. Manganelli said that Mr. Zaccone suffered symptoms as " intractable back and bilateral leg pain (even after spinal cord stimulator)." (R. 00290). The doctor explained that, due to this intractable pain, he recommended Mr. Zaccone stop working on September 27, 2007. (R. 00291). He added that Mr. Zaccone was limited by " [significant] standing, sitting, walking intolerance" and that he expected this impairment to be " permanent." (R. 00291).
Dr. Maida listed Mr. Zaccone's primary diagnosis as ICD Codes 724.0 (spinal stenosis other than cervical) and 722.93 (other and unspecified disc disorder of lumbar region). (R 00292-293). Dr. Maida added a secondary diagnosis of ICD Code 953.0 (injury to cervical nerve root). (R. 00292). He indicated additional diagnoses of " chronic back pain, neuropathy in legs [and] feet, degenerative disc problem." (R. 00292).
Mr. Zaccone was scheduled for termination as of the end of October 2007. He was off work between September 1, 2006, and February 13, 2007 and then again starting October 5, 2007. (R. 00378). Between February 13, 2007 and October 5, 2007, Mr. Zaccone was performing just part of his job, as he was unable to handle his quality control duties. (R. 00378). When Standard contacted him, Mr. Zaccone explained that he could not do the portions of his job that required him to move among different departments like shipping and quality control did. (R. 00377). Mr. Zaccone told Standard that he had had seven lumbar surgeries and one cervical surgery since 1991. (R 00377). He explained that he had a spinal fusion in 2005 and that " that is when the neuropathy in his legs and feet began as well." (R. 00377). He said that he went off work in September 2006 because the conservative treatment of pain from a failed back surgery in 2005 was not working. (R. 00377).
On October 15, 2007, Standard determined that Mr. Zaccone was precluded from performing the material duties of his own occupation, due to his conditions of failed back and neck syndrome, and peripheral
neuropathy. (R. 00289, 00372). Under the insurance plan, a person was considered disabled from their own occupation:
if, as a result of Physical Disease, Injury, Pregnancy or Mental Disorder:
1. You are unable to perform with reasonable continuity the Material Duties of your Own Occupation; and
2. You suffer a loss of at least 20% in your Indexed Predisability Earnings when working in your Own Occupation.
Own Occupation means any employment, business, trade, profession, calling or vocation that involves Material Duties of the same general character as the occupation you are regularly performing for your Employer when Disability begins. In determining your Own Occupation, we are not limited to looking at the way you perform your job for your Employer, but we may also look at the way the occupation is generally performed in the national economy....
Standard's medical case manager noted that Mr. Zaccone had a:
history of 7 lumbosacral surgeries and one cervical surgery. The claimant has had a stimulator implanted. He has attempted to work at a modified capacity but is unable to sustain that. The claimant is precluded from any work activities on a full time basis with continuity. The claimant's condition isn't expected to improve. . . . R[eturn] T[o] W[ork] is not expected.
(R. 00289). The claim decision noted that Mr. Zaccone was:
only answering the phone and doing the computer work since August 2006. The claimant was completely incapable of taking in the materials needed to complete the order, nor able to travel to other departments for quality checks, process express deliveries, or handle special requests from customers that would require collecting the product. Therefore, it is determined that the claimant was not performing the material duties of his own occupation with reasonable continuity.
(R. 00372). It went on to say that it was reasonable that the claimant could not perform the duties of his own occupation and that he " will meet the definition of disability through the Any Occupation date of February 27, 2009," and that the author would " recommend approval of the Any Occupation decision." (R. 00372). Mr. Zaccone was notified of Standard's decision to approve his disability claim by letter dated October 16, 2007. (R. 00049-51). In the October 16, 2007 letter, Standard stated that it had determined that Zaccone became disabled on September 1, 2006, and benefits became payable on February 28, 2007, following the 180-day waiting period. (R. 00049).
A week later, however, Standard requested additional records from Dr. Maida and Dr. Manganelli covering the period from January 2007 to October 23, 2007. (R. 00212, 00215). Among the medical records Dr. Maida provided were notes covering Mr. Zaccone's visit to his office on January 2, February 2, February 26, March 14, April 3, April 19, May 24, July 2, and August 23, 2007. (R. 00216-00223, 00226-00247). On January 2, February 2, February 26, March 14, May 24, July 2, and August 23, 2007, Dr. Maida noted that he performed neurological exams that were normal. (R. 00246, 00243, 00240, 00236, 00227, 00222, 00218). On February 2, 2007, Dr. Maida reported that Dr. Manganelli had implanted a neurostimulator in January 2007. (R. 00242). Dr. Maida also
noted " no further narcotics." (R. 00244). On February 26, 2007, Dr. Maida reported that a straight leg raising test was negative. (R. 000240). On April 19, 2007, the doctor wrote that Mr. Zaccone said his back pain was " OK," and that he was doing better with the stimulator. (R. 00229). On July 2, and August 23, 2007, Dr. Maida noted that musculoskeletal exams of Mr. Zaccone's neck, back, upper extremities, lower extremities, and gait were all within normal limits. (R. 00222, 00218).
Dr. Maida's records also included notes covering Mr. Zaccone's treatment with podiatrist Julie Andreas. (R. 00250-00253). On May 5, May 17, and June 18, 2007, Dr. Andreas noted that Zaccone's " Muscle strength is 5/5 supinators and pronators. Joints are congruous, equal, and pain free." (R. 00253, 00252, 00250). On May 5, June 4, and June 18, 2007, Dr. Andreas noted that Zaccone's " Neurovascular status is intact." (R. 00253, 00251, 00250). On May 17, 2007, Dr. Andreas reported: " Neurologic: Grossly intact to sharp/dull, light touch, and proprioception bilaterally." (R. 00252).
Dr. Manganelli provided the operative report of T3, T4, and T5 intercostal nerve blocks, performed by Dr. Yousuf Sayeed on August 31, 2007. (R. 00214). Dr. Sayeed noted that Mr. Zaccone " recovered and [was] sent home in good condition. He will follow up with Dr. Manganelli in the office." (R. 00214). No follow-up records were provided. (R. 00213-00214).
On November 20, 2007, Standard consulted Dr. Mary Lindquist, who is Board Certified in Internal Medicine and Independent Medical Examination, and whose practice focuses on non-surgical management of spinal disorders. (R. 00204-00207). In her December 18, 2007 Physician Consultant Report, Dr. Lindquist noted that the " records submitted for review yield very little information regarding the claimant's neck and back conditions other than some APS forms...from the claimant's treating pain specialist and his [primary care physician]." (R. 00198). Dr. Lindquist further noted that Mr. Zaccone reported " that he underwent 'laser surgery' at L5-S1 two times in 1992 and then underwent an L5-S1 laminectomy that same year. [Mr. Zaccone] also listed that he underwent C6-7 fusion in 1996." (R. 00198). She added that " it appears that he is on a short-acting opioid up to 3 to 4 times per day along with an anti-inflammatory agent plus the spinal cord stimulator...without documentation of cognitive dysfunction in relation to these medications. There has been no documentation of any focal neurological deficits." (R. 00199). " [F]rom the records presented thus far," Dr. Lindquist said she was " unable to determine the exact nature of the claimant's spinal condition. Certainly, no evidence has been presented thus far to suggest an ongoing active cervical or lumbar radiculopathy." (R. 00200).
Standard also consulted Dr. Janette Green, Board Certified in Internal Medicine. (R. 00196-197). In her January 16, 2008 Physician Consultant report, Dr. Green reviewed Dr. Maida's 2007 office notes, records from Mr. Zaccone's podiatrist, Dr. Julie Andreas, and from his gastroenterologist, Dr. Harold Mozwecz. (R. 00190-192). Dr. Green noted that Dr. Maida's January 2007 examination of Mr. Zaccone reflected a normal neurological findings, and that Dr. Maida diagnosed Mr. Zaccone with spinal stenosis. (R. 00190). Dr. Green opined that " [t]he conditions supported by the documentation include those of chronic back pain and atypical chest pain. (R. 00192). But, she added that there was " no documentation that indicates that the claimant has any
neurological deficits, such as radiculopathy or myopathy." ...