What happens when a claimant asserts totally disability… caused by subjective physical pain and mental illness?

For example, sometimes claimants allege total disability from the combined conditions of subjective pain complaints (with provable back abnormalities) and depression caused by the pain.

This is when you want to take a closer look at the impact of the 24 month Mental/Nervous limitation in the policy.

Here’s the case of Krash v. Reliance Standard Life Insurance Group, __ Fed. Appx. __ (3rd Cir. February 12, 2018) (“to remain eligible for benefits past the 24 month mark, ‘it was [Krash’s] burden to prove she was totally disabled from any occupation solely due to a physical condition.’”) And…kudos to some nice work by my friend Joshua Bachrach on this nice win…

FACTS: Krash sought ERISA-governed disability benefits due to subjective back pain. She also expressed that “tremors” were her primary complaint. The policy (with Reliance Standard) limited disability benefits to 24 months for disabilities “caused or contributed to by mental or nervous disorders.”

An Independent Medical Exam (IME) confirmed Krash had (1) degenerative disc disease with no atrophy “which indicates normal usage”; (2) only subjective pain complaints; and (3) body tremors that were “psychogenic in nature.” Reliance Standard discontinued benefits because Krash “suffered a mental or nervous condition that contributed to her alleged disability and…was not, in the absence of a mental or nervous condition, physically disabled.” Krash sued, and the abuse of discretion standard was applied.

ISSUE: Whether Krash established she was totally disabled (alleging both subjective complaints and mental conditions).

THIRD CIRCUIT COURT OF APPEALS HELD: AFFIRMED SUMMARY JUDGMENT FOR RELIANCE STANDARD

  1. Krash claimed her physical condition caused her depression, anxiety and psychogenic tremors. But the court noted: “to remain eligible for benefits past the 24 month mark, ‘it was [Krash’s] burden to prove she was totally disabled from any occupation solely due to a physical condition.’” Op. at 6-7 (emph. added).
  2. “‘[C]aused by or contributed to by’ in a mental disorders limitation clause [means] that benefits may be terminated when physical disability alone is insufficient to render a claimant totally disabled.” Op. at 7 (emph added).
  3. “‘[T]he fact that the Plaintiff has been diagnosed with a condition does not equate to proof she is totally disabled from any occupation as a result of the condition….Under the policy Krash still had to prove that her condition prevented her from ‘perform[ing] the material duties of any occupation.’” Op. at 7.
  4. The Court determined the record did not support total disability, and she was able to perform sedentary work.

KEY TAKE AWAY: The Third Circuit is aligned with the Fifth, Sixth and Ninth Circuits in interpreting the phrase “caused or contributed to by” in a mental disorders limitation clause to mean that benefits may be terminated when physical disability alone is insufficient to render a claimant totally disabled.