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Compliance July 3, 2007
LTD Recipient Loses Benefits Denial Appeal
July 3, 2007 (PLANSPONSOR.com) - A federal judge in
California has upheld a decision by a disability benefit
plan's claims administrator to cut off benefits despite a
worker's claims of depression and anxiety after the plan
discovered contrary evidence.
Reported by Fred Schneyer
U.S. District Judge Audrey B. Collins of the U.S. District Court for the Central District of California ruled that the AT&T Disability Income Plan did not abuse its discretion in ending benefits paid to Afsaneh Safavi. Safavi was a data solutions manager who had gone out on disability claiming that her psychological ailments were too severe to allow her to work.
Safari received long-term disability benefits from December 2001 through January 2005 as a result of the claims.
According to Collins’ ruling, the plan first discovered that Safavi had participated in acting classes while receiving the benefits – claims the plan said were contrary to her previous assertions that she was so infirm that she couldn’t leave home.
A third-party claims administrator, looking into Safavi’s situation, found her Web site on which she reported that she had appeared in movies and plays while she was claiming to be disabled. The administrator showed its findings to its consulting doctors who indicated that she might have been malingering, according to the ruling.
The administrator told Safavi on March 3, 2005 that it was cutting off her benefits based on the Web site and doctor’s reports, but allowed her multiple appeals, the rulings said. The administrator eventually denied her appeal and Safavi filed her federal court suit.
The case is Safavi v. SBC Disability Income Plan,C.D. Cal., No. CV 06-01324 ABC(CTX), 6/26/07.