Lamuth v. Hartford Life & Accident Ins. Co.
| Decision Date | 09 July 2014 |
| Docket Number | Case No. C13–1832–JCC. |
| Citation | 30 F.Supp.3d 1036 |
| Court | U.S. District Court — Western District of Washington |
| Parties | Delacy LAMUTH, M.D., Plaintiff, v. HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY, Defendant. |
Melton L. Crawford, MacDonald Hoague & Bayless, Seattle, WA, for Plaintiff.
D. Michael Reilly, Lane Powell PC, Seattle, WA, for Defendant.
This matter comes before the Court on the motion to dismiss filed by Defendant Hartford Life and Accident Insurance Company (Dkt. No. 21) and Plaintiff Delacy Lamuth's motion for partial summary judgment (Dkt. No. 28). Having thoroughly considered the parties' briefing and the relevant record, the Court finds oral argument unnecessary and hereby GRANTS IN PART and DENIES IN PART Defendant's motion to dismiss and GRANTS Plaintiff's motion for summary judgment.
Plaintiff Delacy Lamuth, M.D., brought this ERISA lawsuit to recover benefits due under a long-term disability plan established and maintained by her former employer, Inland Imaging Associates, PS (“Inland”), and to seek clarification of her rights to future benefits under the same. The employee welfare benefit plan is underwritten and insured by Defendant Hartford Life and Accident Insurance Company (“Hartford”), which has authority to grant or deny claims under the Plan. As explained herein, Hartford denied, then granted, then reversed itself and again denied Dr. Lamuth's claim for benefits. After Dr. Lamuth brought this lawsuit, Hartford again changed course, re-reviewed the claim, and awarded her benefits. While Dr. Lamuth is currently receiving long-term disability benefits under the Plan, the parties dispute whether she may continue this lawsuit and obtain a declaratory ruling as to when she first became disabled under the Policy. Dr. Lamuth seeks such a ruling in order to preclude Hartford from continuing to reverse its position on this issue. The Court reviews the Policy provisions and the parties' relationship to date.
Under the terms of the Policy, the terms “Disabled” and “Disability” are defined in relevant part as follows:
You are prevented from performing one or more of the Essential Duties of:
(Dkt. No. 23, Ex. 1 at 25–26.) An “Essential Duty” is defined as a duty that (Id. at 26.) The Plan contains a Pre-existing Conditions Limitation, however, which precludes the payment of benefits for an individual with a qualifying Disability under certain circumstances. That provision states that Hartford “will not pay any benefit ... under The Policy for any Disability that ... is caused or contributed to by, a Pre-existing Condition, unless, at the time You became Disabled ... 1) You have been continuously insured under The Policy for 12 consecutive month(s).” (Id. at 20.)
If an individual is deemed “Disabled” under the Plan and not subject to the Pre–Existing Conditions Limitation, among others, Hartford will pay benefits. The Policy contains numerous additional requirements with which a claimant must comply for benefits payment to continue on a regular basis. The Policy requires ongoing Proof of Loss to qualify for benefits, which includes, in part: documentation of the prognosis of disability; earnings and income; evidence that the claimant is under the Regular Care of a Physician; any and all medical information; the identification of all physicians, hospitals, pharmacies; and documentation regarding Other Income Benefits. (Id. at 20.) The Policy also permits Hartford to require the claimant to meet and interview with its representative and to have the claimant examined by a Physician, vocational expert, functional expert, or other professional. (Id. at 21.) The Policy specifically provides that Hartford “may request Proof of Loss throughout Your Disability[,]” and “must receive the proof within 30 day(s) of the request.” (Id. )
Finally, the Policy contains a Termination of Payments provision, pursuant to which benefit payments will stop on the earliest of:
1) the date You are no longer Disabled; 2) the date You fail to furnish Proof of Loss; 3) the date You are no longer under the Regular Care of a Physician; 4) the date You refuse Our request that You submit to an examination by a Physician or other qualified professional; 5) the date of Your death; 6) the last day benefits are payable according to the Maximum Duration of Benefits Table; 7) the date Your Current monthly Earnings exceed 80% of Your Indexed Pre-disability Earnings if You are receiving benefits for being Disabled from Your Occupation; or 8) the date no further benefits are payable under any provision in The Policy that limits benefit duration.
(Id. at 15–16.) Notably, the Pre-existing Conditions Limitation is not subject to the ongoing Proof of Loss provision or the Termination of Payments provision; instead, it exists as a separate exclusion under the Policy's terms.
Dr. Lamuth is a radiologist. She first became a beneficiary under the Hartford Plan on July 1, 2011, when she began working for Inland Imaging Associates, PS at Samaritan Hospital in Moses Lake, Washington. (Dkt. No. 25–2, Ex. 1 at 48.) Before joining Inland Imaging, Dr. Lamuth was diagnosed with multiple sclerosis
. Her diagnosis notwithstanding, Dr. Lamuth worked as the sole radiologist at Samaritan Hospital until February 14, 2013, when she ended her employment due to the effects of her MS. (Id. at 36, 48, 68.)
Dr. Lamuth applied for long-term disability (“LTD”) benefits under the Hartford Plan on March 1, 2013. (Dkt. No. 25–1, Ex. 1. at 32.) Upon receipt of her claim, Hartford noted in its files that Dr. Lamuth's “Recovery Outlook” was “Low,” her “Occupational Complexity” was “High,” and her disability was likely “permanent” due to the fact that MS is a “progressive disease.” (Id. at 30.) Shortly thereafter, Hartford noted that Dr. Lamuth's “Date of Disability” (“DOD”) was February 15, 2013, the day after she ended her employment. (Id. at 29.) However, Hartford expressed reservations as to Dr. Lamuth's Date of Disability, noting that it may be able to apply an earlier DOD based on a report that Dr. Lamuth began working a “reduced schedule” on June 1, 2012. (Id. at 30.) If Hartford could use an earlier date, the claim notes repeatedly state, the Pre-existing Conditions Limitation would bar coverage. (See id. at 30 (); id. at 29 (); id. at 27 ); accord id. at 16, 19–23, 26.) Hartford sought medical records from two treating physicians, which it received. The medical records produced did not indicate any restrictions or limitations on Dr. Lamuth's employment, see id. at 66–70, though it is undisputed that Dr. Lamuth did reduce her formal work schedule from approximately 40–hours per week to 35–hours per week in June 2012.
Hartford denied Dr. Lamuth's claim for benefits on June 7, 2013. (Dkt. No. 25–1, Ex. 1 at 71–75.) The denial letter explained that Dr. Lamuth's “last day of work on a full time, full duty basis as a Radiologist was 5/31/12[,]” and that accordingly, this May 31, 2012 disability date triggered the Pre-existing Conditions Limitation because it was only eleven months after the day she became a beneficiary on July 1, 2011. (Id. ) Dr. Lamuth filed an administrative appeal, explaining that she continued to work full time after June 1, 2012, and continued to perform all essential duties of her position. (Dkt. No. 25–2, Ex. 1 at 1–5.) She pointed out that the term “full duty,” upon which Hartford relied to deny benefits, appeared nowhere in the Policy; that the Policy does not use the term “full time” to determine whether the Pre-existing Conditions Limitation applies or within the definition of “Disabled” or “Disability”; and that the Policy, as a matter of eligibility to participate, defines “Full-time” as “at least 20 hours weekly, excluding on-call hours,” which Dr. Lamuth says she easily met.1 (Id. ) She also provided declarations from treating providers, who stated that they had not placed any restrictions or limitations on Dr. Lamuth in May 2012, and that she was fully able at that time to perform all essential duties of her position.2 (Id. at 18–20.) Finally, Dr. Lamuth provided a declaration from her employer, who stated that despite a limited modification in Dr. Lamuth's formal work schedule-from 40 to 35 hours of scheduled time per week-in June 2012, she continued to perform all essential duties of her position; continued to work more than her scheduled hours, since as the only salaried radiologist, Dr. Lamuth was responsible for all radiology work regardless of scheduled hours; and that following the June 1, 2012 modification of her schedule, Dr. Lamuth's salary did not decrease to less than 80% of her...
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