While the Second Circuit in a recent case--Hobson v. MetLife--upheld the plan administrator's determination that the participant in question was not entitled to long-term disability benefits, the court warned plan administrators to provide an explanation when they determine a participant is not disabled and their determination differs with the Social Security Administration:
We encourage plan administrators, in denying benefits claims, to explain their reasons for determining that claimants are not disabled where the SSA arrived at the opposite conclusion: Doing so furthers ERISA’s goal of providing claimants with additional information to help them perfect their claims for subsequent appeals.
The court also did not believe that the structural conflict that the plan administrator had in being both the "evaluator and payor of benefits" in this case "influenced its reasonable interpretation" of the participant's claim for disability benefits. Thus, the court declined to give the conflict of interest any weight pursuant to the Supreme Court's MetLife v. Glenn analysis.
Disability determinations can occur in all types of benefit plans, including qualified retirement plans, and therefore the significance of the case should be analyzed for its impact on other types of ERISA plans as well.
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