:: Seventh Circuit Holds For Insurance Carrier Denying Claims Under “Arbitrary and Capricious” Standard

In short, the justifications given by the MRC for its decision—although certainly not indisputable—are reasonable, which is all that is required. See Davis, 444 F.3d at 576-77 (“The judicial task here is not to determine if the administrator’s decision is correct, but only if it is reasonable.”); Sisto, 429 F.3d at 701 (“Raising debatable points does not entitle [the claimant] to a reversal under the arbitrary-and capricious standard.”). Because the record contains rational support for the MRC’s assessment, we will not disturb its decision to deny Speciale’s claim for disability benefits.

Fibromyalgia claims face long odds in federal court, and this Seventh Circuit decision fits the typical pattern. As a post MetLife v. Glenn decision, the case does nonetheless present some surprise in that it does not address the standard of review in more than a passing manner.

The district court held, and the parties concede, that review of the MRC’s denial of benefits proceeds under the arbitrary-and-capricious standard, and we will only look to ensure that the Program’s decision “has rational support in the record.” Davis v. Unum Life Ins. Co. of Am.,444 F.3d 569, 576 (7th Cir. 2006) (internal quotationmarks omitted). “Put simply, an administrator’s decision will not be overturned unless it is downright unreasonable.”Id.

Notwithstanding that statement of the law, the Court is concerned to say that it does not “rubber stamp” the administrator’s decision. Having noted that ostensible limitation, the Court went on to say that it would:

. . . uphold the plan’s decision 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.”

Sisto v. Ameritech Sickness & Accident Disability Benefit Plan, 429 F.3d 698, 700 (7th Cir. 2005) (internal quotation marks omitted).

The claim was evidently a toss up. The question boiled down to a conflict of opinions provided by the experts:

The only evidence of Speciale’s functional capabilities provided to the MRC consisted of the questionnaires completed by Drs. Winny and Keane and Dr. Blonsky’s reports. The committee was therefore faced with the conflict between Dr. Winny’s questionnaire and Dr. Keane’s belief that Speciale could work, along with Dr. Winny’s later statement that Speciale could attempt a position that did not require travel.

On the “not downright unreasonable” standard, the tie goes to the disability carrier.

Note: The claim did not go unpaid. The opinion notes that “[a]fter her appeal failed, Speciale sent the MRC a copy of a favorable ruling by the Social Security Administration granting her application for disability benefits.”
Tie-Breaker? In the event of a structural conflict of interest, any one factor can serve as a tie-breaker per the Supreme Court in MetLife v. Glenn:

We believe that Firestone means what the word “factor” implies, namely, that when judges review the lawfulness of benefit denials, they will often take account of several different considerations of which a conflict of interest is one. . . . In such instances, any one factor will act as a tiebreaker when the other factors are closely balanced, the degree of closeness necessary depending upon the tiebreaking factor’s inherent or case-specific importance.

This argument was evidently not pressed upon the Seventh Circuit