Discovery in LTD Cases

When a group long term disability (“LTD”) claim is litigated, insurance companies argue that no discovery should be allowed because the court’s decision has to be based on the administrative record, that is, the claim file, that the insurer used. The insurance companies oppose discovery because they know it will reveal evidence that they improperly decided to deny or terminate a claim.

Last week, I received a decision that rejected the insurance company’s argument that no discovery should be allowed in an LTD case, even though the magistrate judge who issued the decision had previously ruled against discovery in a similar situation. The court ruled that while no evidence had been presented to admit additional evidence outside of the administrative record, the claimant was entitled to determine who the decision makers were, why certain pieces of evidence were deemed more credible than others, and whether the administrative record was complete.

Obtaining the type of discovery approved by the court is critical for two reasons. First, the discovery helps show why the insurer’s decision was unreasonable. Second, because of what discovery is likely to reveal, it frequently pressures the insurer into settling the litigation.

Constant Vigilance

It typically takes about six months to get a decision from the Social Security Administration (the “SSA”) when filing an application for disability benefits. If a decision has not been received by that time, it frequently means that something has gone wrong.

Regardless of whether I submit records by certified mail, fax with confirmed receipt, by hand with time stamped copy, and even when submitted electronically using the SSA’s secured website with confirmation receipt, the SSA loses submissions. When the SSA loses evidence, it tends simply to sit on the claim.

I received a fully favorable decision today on an application that should have been decided several months earlier, but was delayed because the SSA lost evidence and sat on the application. The claim had very strong medical and vocational support. When there was no decision on the initial application after six months, I sent letters and made phone calls to learn why the claim had not been approved. About three months later, I finally received a letter from the SSA claiming that it had no record of my client’s application, so I would have to file a new application all over again.

I advised the local SSA representative that I would not begin the application all over again. I added that the fact that he had sent me a notice of disapproved claim shows that he had the file at some point, and that because he had received the certified mail request for a hearing he was required to transfer the file to the hearing office.

When two weeks went by and the file was not transferred, I notified the SSA representative that I intended to hold him personally responsible, and would commence a Congressional inquiry into his losing the application and directing that a new application be filed. I warned that if he failed to drop his demand for a new application and failed to transfer the claim for a hearing immediately, I would have the claimant’s Congressman contact the representative’s District Manager to explain how he denied the claim, but now claimed that he never had it. The file was transferred within a few days.

Once the file was transferred, I filed a request for a fully favorable decision on the record, which was granted. The claimant did not have to attend a hearing, which meant he avoided the two year delay in obtaining benefits. However, because of the local office’s actions, the claimant’s benefits were delayed several months.

Judges Are Fallible

I received a partially favorable decision from a Social Security Administrative Law Judge (the “ALJ”) today, which provided the claimant with 80% of the benefits sought. When the client called to pick up the file, I asked why. The answer, “Because the Judge said I wasn’t entitled to anything more.” The claimant was also concerned about the decision being reversed if appealed.

I explained that there were four different grounds for reversing the ALJ’s decision. The ALJ failed to follow the rules for: (1) assessing testimony, (2) determining if the claimant was presumptively disabled under a “listed” impairment, (3) evaluating medical evidence under the “treating physician rule,” and (4) using a medical expert to determine the disability onset date. I explained that additional benefits were dependent on just one of those grounds being accepted. After the claimant understood why the ALJ’s decision was faulty, and that ALJ decisions are rejected on appeal a substantial percentage of the time, the claimant decided to appeal the decision.

A claimant should insist on a detailed explanation if their hearing decision is not fully favorable. If the attorney does not think there are grounds for an appeal, get a second opinion.

Clerical Mistakes

The Social Security Administration (the “SSA”) makes clerical mistakes all the time. For example, the SSA constantly loses birth certificates and medical records even when those documents are sent by certified mail. The SSA also has frequent problems with maintaining its files. The SSA fails to get records to the state agency reviewing the file and vice versa; and the district office fails to get all of the records to the hearing office (“ODAR”).

I represented a claimant with a strong case for receiving Social Security Disability (“SSD”) benefits whose claim was approved today. Like the majority of SSD claims, the SSA denied the initial application. Once the file was transferred to the ODAR, I submitted a request for a fully favorable decision on the record (“OTR”) summarizing the medical and vocational evidence and providing the legal arguments in support of awarding SSD benefits.

The majority of the time, my OTR requests are approved, which saves the claimant money and avoids the stress of having to attend a hearing. Despite the fact that this claimant’s OTR was very strong, the OTR was denied. The ODAR would not explain the basis for rejecting the OTR, and the claimant was scheduled for a hearing. In preparation for the hearing I reviewed the file. However, even though the OTR was hand delivered, it was not in the file. I showed the filing receipt to the ODAR, but they had no answer why the OTR was not associated with the file.

After resubmitting the OTR, the claimant’s application and OTR were approved. Because of the ODAR clerical error, the claimant had to wait a few extra months to receive his SSD benefits. This was yet another example showing that despite documents being sent via certified mail or hand delivered, after a claim is denied the file should always be reviewed as soon as possible.

Needless Forms

I had another self employed claimant's SSD application approved today at the initial level. I was surprised because I had been told that the claim would be denied for two reasons.

First, I was told that the claim would be denied if I failed to submit a work activity report, which details any work after the alleged disability onset date. I refused to submit the work activity form because I contended that all the information had already been supplied with the application. Second, I was told that the claimant's application would be denied unless I submitted his complete tax records for the past year, but I refused to provide anything other than the first page of the federal tax return on grounds of relevancy.

Because the application was approved at the initial level without explanation, I cannot know the reason why the "required" information did not prevent approval of the application. However, the experience does indicate that demands for superfluous information cannot justify rejecting a valid claim.

Objective Evidence of Pain

Thousands of disability claims of all types are denied for lack of “objective” evidence, even though the case law consistently states that a claim should be denied solely because of a purported lack of objective evidence. Many people can no longer work because of pain, which is by definition subjective. Even when objective proof of a condition that causes the pain is presented, it is common for the claim to be denied.

A great way to “objectify” the pain is treatment by a pain management specialist. I had a claimant who was diagnosed with fibromyalgia and reflex sympathy dystrophy (“RSD) by a rheumatologist. The diagnoses were not disputed and were confirmed by objective clinical findings. Even though the rheumatologist supported the claim, the claim was denied on the grounds that there was no support that the claimant’s pain was severe enough to prevent her from working. The claimant asked me to handle the appeal.

On appeal, I submitted a medical report from the claimant’s pain management specialist, who was also a board certified neurologist. The neurologist had not been contacted, nor had his records been obtained. It seemed arbitrary to deny that the claimant’s pain was disabling without considering any evidence from the pain management specialist.

The neurologist diagnosed the claimant with fibromyalgia, complex regional pain syndrome, and chronic pain syndrome. Just like the rheumatologist, the neurologist identified the positive clinical findings that supported the diagnoses, and he also provided similar restrictions and limitations. The only real difference in the reports was that the neurologist detailed the nature, location, frequency, severity and precipitating factors of the claimant’s pain. As a pain management specialist, there was no basis for discounting his opinion regarding the severity of the claimant’s pain, and the claim was approved today.

I advise my clients to treat with pain specialists, even if the medications and treatments offered are similar to what other treating physicians are providing. It seems difficult to reject an opinion regarding a claimant’s pain from a physician who specializes in pain management.

The SSA & The Self Employed Claimant

When it comes to disability, the default position of the Social Security Administration (the “SSA”) is that applicants are not disabled. Thus, the SSA draws every presumption and inference in favor of denying an application for Social Security Disability (“SSD”) benefits. One such presumption concerns applicants who were self-employed.

When an applicant who was self employed applies for SSD, the SSA presumes that the applicant is still working off the books. This presumption frequently gets extended to ridiculous lengths. I had a client who after receiving SSD told the SSA that he was resuming work for his wife’s company. Instead of rewarding the claimant for his honesty, the SSA demanded an overpayment on the grounds that he must have been working off the books for years.

Despite the fact that the SSA never has any evidence that a formerly self-employed SSD applicant is working off the books, the SSA asserts that it will deny benefits unless the claimant proves otherwise. The claimant can submit an affidavit that he or she is not working, which is the same evidence that must be accepted at a hearing. However then the SSA has rejected such affidavits at the initial application stage, and requested tax records. However, when I have produced the tax records revealing no income, or advised the SSA that the claimant did not file because there was no income, the SSA still refused to approve benefits for lack of evidence.

The problem is that the SSA is requiring the claimant to prove a negative; that is, something that does not exist. You can prove you are working by your testimony or that of co-workers. Employment and tax records can also establish gainful activity. Because there is no direct proof that one is not working, what can one do when the SSA rejects indirect proof?

I recently succeeded in getting SSD benefits approved for a formerly self-employed hardware store owner at the initial application stage. I refused to provide the tax records of the applicant’s spouse on numerous grounds. However, I supplied letters from the hardware store suppliers stating that the applicant no longer worked at the store. Those letters must have sufficed because the SSA, which had told me benefits would be denied if I refused to turn over the tax records, approved the application. The letters were very short, and required little effort on the part of the suppliers, or the claimant in securing them.