You know that most ERISA disability plans contain a 24-month limitation related to mental/nervous disabilities.

But what happens when the claimant alleges the mental illness is “organically caused”? Is that enough to justify benefits beyond the 24-month period?

Not in this case…

Here’s the case of McAlister v. Liberty Life Assur. Co. of Boston, __ Fed. Appx. __ (6th Cir. May 4, 2016)(Applying abuse of discretion standard of review: “[W]hile it is clear that plan administrators owe fiduciary duties to beneficiaries,…whether that duty encompasses a duty to reasonably investigate remains unclear.”)

FACTS: McAlister was suicidal and depressed, and applied for ERISA-governed long term disability benefits in August 2010. Liberty Life granted the benefit and later informed McAlister that her long term disability benefits would end when the 24 month maximum benefit for mental nervous disabilities had been paid. McAlister then sought benefits beyond 24 months, claiming she had “cognitive problems” related to diabetes, hypertension and other physical problems.

DISTRICT COURT HELD: Liberty properly exercised discretion in determining McAlister suffered from mental illness that had a psychiatric (not organic) cause.

SIXTH CIRCUIT HELD: AFFIRMED– Dismissal of Claim based on 24 month mental/nervous limitation.

  1. Even if the court took out of the analysis the independent medical assessment, notes from three of Plaintiff’s medical providers constitute “‘relevant evidence… a reasonable mind might accept as adequate to support [the] conclusion that McAlister suffers from a Mental Illness.’” Op. at 13.
  2. The Court rejected the “duty to investigate” argument. McAlister alleged she had put Liberty on notice that her mental condition had an organic cause, and that Liberty had failed to investigate it. Op. at 17.
  3. “[W]hile it is clear that plan administrators owe fiduciary duties to beneficiaries,…whether that duty encompasses a duty to reasonably investigate remains unclear.” Op. at17.
  4. If there is a duty to investigate, “the parameters of such a duty are altogether undetermined.” Op. at 18.
  5. “‘There is no justifiable basis for placing the burden solely on the administrator to generate evidence relevant to deciding the claim, which may or may not be available to it, or which may be more readily available to claimant.’” Op. at 18.
  6. It was unnecessary for the plan administrator in this case to conduct its own neuropsychological evaluation. Op. at 19.