Appeals Court Says Aetna Acted Arbitrarily
The Aetna plan deemed an employee disabled if he
cannot work at a “reasonable occupation” and
pay more than 80% of his pre-disability income. The
appeals court ruled that while there was enough evidence
to prove the participant was physically able to go back
to work, Aetna did not consider the 80% of pre-disability
income requirement before it terminated the plan,
according to the
opinion
.
Prior to becoming disabled because of an eye disease in
1999, Thomas Biljan worked as a machine operator, earning
an annual salary of $64,412.17. As required by the plan,
Biljan participated in a vocational rehabilitation
program, where it was determined that he would benefit
from a college education that Aetna would pay for.
After graduating in June 2002 with a degree in business
communication, the plan required that Biljan make
reasonable efforts to secure employment at a
reasonable occupation. However, even with Aetna’s
assistance, Biljan was unable to secure an occupation
that would pay 80% of his pre-disability income.
Aetna terminated Biljan’s benefits in March 2003,
writing in the termination letter that he completed the
vocational rehabilitation program and he was physically
able to go back to work at a “reasonable
occupation.”
The appeals court found that Biljan was physically able
to work, but “[i]f physical ability to work were the
sole calculus of disability, we could terminate our
inquiry at this point,” Judge Jennifer Coffman wrote
in the opinion. She continued that “under the terms
of this particular plan and as conceded by Aetna’s
counsel, disability turns not only on a claimant’s
ability to work, but also on his ability to work at a
reasonable occupation, which is defined as one that pays
more than 80% of his pre-disability income. To work at a
reasonable occupation, one must be fitted by
“training, education or experience.”
Because Aetna did not consider training, education or
experience, the appeals court found that Aetna acted
arbitrarily in terminating Biljan’s benefits,
reversing in part an earlier ruling by the US District
Court for the Eastern District of Michigan, which ruled
in favor of Aetna.
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