One of the enduring sources of work for employee benefits attorneys are clients who fail to follow their own procedures, or follow them in a sham manner. This can happen with employee policies and procedures in promotion, hiring, or administration, and in the administration of employee benefits.
The Seventh Circuit recently issued a rare decision that overturns a decision made by a Plan administor, which ordinarily enjoys an 'arbitrary and capricious' deferential standard of review. The Court focused on tiny details of the administrator’s handling and the the medical review relied on by the administrator, finding that a flaw in the medical review warranted overturning the denial. This is far different from a 'some evidence' standard. The modern trend is to test the quality of that evidence, followed by a decision as to whether the evidence is of a sufficient quality, and not just quantity, to support the administrator’s decision.
Such nit-picking adds to instability in practice in order to promote equity. You would think that an 'arbitrary and capricious' would preserve your client's decision. The upshot is that practicioners increasingly need to treat benefit denial appeals with as much tender loving care, as, say, dismissals in the employment context. Document, document, document, and follow your procedures!
Majeski v. Metropolitan Life Insurance Co., No. 09-1930 (7th Cir. Dec. 29, 2009)
