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By Jason M. Scally
Two Boston attorneys recently garnered a $1 million settlement against a disability insurance carrier when they argued that their client, an obstetrician/gynecologist, was "totally disabled" because he could not perform any of his obstetrical surgeries as a result of his own medical condition.
The insurance company argued that the plaintiff was not "totally disabled" and denied coverage because he could still perform some scheduled gynecological procedures, and that its policy required the policyholder to be unable to perform all of his or her duties in order to qualify.
The defendant also asserted that the doctor actually had "dual professions" - obstetrics and gynecology - and as long as he could perform one of the functions, he was not disabled.
But Sigmund J. Roos and George P. Field of Boston, the plaintiff's attorneys, successfully refuted the defendant's claims with objective evidence of their client's condition and a battery of experts.
What ultimately came down to a war of words — whether an OB/GYN doctor had one or two specialties and whether the policy required an inability to perform all duties or a substantial duty — hinged on the affidavits of powerful potential witnesses who would have argued both from a medical and insurance company standpoint that the doctor was totally disabled and unable to perform his profession.
Vague wording in insurance contracts is nothing new, but the insurance company's interpretation of the plaintiff's profession as a "dual occupation" represents a significant trend by insurance companies that has led to litigation in Massachusetts and other jurisdictions, Roos and Field observed.
In a strange twist of fate, noted the lawyers, a national seminar on "dual occupation" insurance policies was offered on the same day as the mediation.
Roos obviously missed the seminar because of the mediation, but quipped: "Maybe we'll get the materials for the next case."
The Boston trial lawyer remarked, however, that situations similar to the one his client experienced are not uncommon and that attorneys need to be aware of what their client's policies say.
Roos observed that litigators and business lawyers alike may need to check the policy language for possible vagaries to see if their clients are really covered.
Legal practitioners may want to check their policies for themselves as well, he suggested, because attorneys and judges also have many distinct duties that may be interpreted to be separate professions under a disability policy.
"If a judge, for example, says that his or her occupation involves sitting at court and writing opinions, and the judge has what our client has [and can no longer sit], is the judge disabled?" the Boston attorney questioned as one illustration of the possible problems that could arise.
Roos warned that attorneys and judges "would be well advised to ask his or her insurance carrier how they would handle the situation."
Precluded From Surgery
Although the parties' settlement in this case was covered by a confidentiality agreement restricting the use of the names of the parties and the location of the events, some general background facts have been disclosed by agreement.
The case concerned a 54-year old obstetrician/gynecologist who was diagnosed with prostate cancer sometime around December 1996, who subsequently underwent radiation treatment that resulted in severe side-effects.
The radiation therapy that was administered often leaves patients with tissue or nerve damage, or both.
In the plaintiff's case, he suffered from both and it left him with a condition called radiation enteritis that causes a "sense of urgency" and incontinence, according to Roos.
As a result of this condition, the plaintiff had to stop performing surgeries on his obstetrical patients — the majority of his practice prior to this condition — but resumed work on a limited basis with scheduled gynecological procedures.
Starting in 1977, the plaintiff had taken out a disability policy with the defendant and increased his coverage amounts with this insurer on at least five subsequent occasions.
The policies included a "total policy" which insured the plaintiff against "total disability."
According to Roos, "This allegedly meant that the insured would be covered if he ... were to find him[self] unable to perform any one or more of 'the substantial and material duties of his occupation.'"
Under the policy, the insurance company defined "occupation" as a "recognized specialty," and determined that the plaintiff specialized in "gynecology" and "obstetrics" — two separate specialties.
Since the plaintiff could still perform some of his duties, the insurance company found that he could perform "the substantial and material duties of his occupation" and denied coverage.
The plaintiffs filed suit in an undisclosed court in order to force the company to pay the doctor the benefits under his policy.
Although the defendant moved for summary judgment, the plaintiff's attorneys introduced affidavits from their experts detailing their future testimony — which seemed to force the settlement.
"I think when we got to discovery, everyone was willing to settle," Roos observed.
The parties ultimately settled at the mediation for $1 million, but the rest of the details are protected by a confidentiality agreement also negotiated as part of the settlement.
War Of Words
The battle between the doctor and his insurers ultimately came down to each side's interpretation of the contract's terms.
The insurance carrier relied on a Supreme Judicial Court decision from 1889 stating that a plaintiff who was a leather cutter and merchant actually performed two separate occupations.
By analogy, the defendants argued that he practiced both "obstetrics" and "gynecology" — which constituted two distinct specialties.
"The insurer took the position that as log as he could perform any of his gynecological duties, he was not disabled," noted Field.
But the plaintiff's attorneys argued that an OB/GYN doctor was, in fact, only one specialty.
Roos said, "We had an expert that was on the Board of Governors of the American Academy of Obstetrics and Gynecology which is the board that certifies specialists, and he said there is no such thing as we know as a 'obstetrician,' and there's no such thing as a 'gynecologist'— but there is such thing as an 'obstetrician/gynecologist.'"
The plaintiff's lawyer remarked: "It's like saying a lawyer who does mergers and acquisitions has a 'dual occupation' [but] you don't do mergers without acquisitions."
Roos further argued that the policy language meant that the plaintiff should be covered if any of the substantial material duties could not be performed, not all, as the insurance carrier asserted.
"We took the position that you need to be knocked out on only one [duty] to be covered, which seems to make sense where the policy says that you are covered if you are unable to perform the substantial material duties of your job," he said. "So we had a fundamental difference [of interpretation]."
Roos remarked, "It had everything to do with how you read the word 'the.'"
The insurance company did not provide any experts on contract interpretation, choosing to rely on their own interpretation.
Roos said that he was prepared to bring the former head of a claims director from another insurance company to testify that "any objective and reasonable insured person could and should understand that he or she would be treated as totally disabled under the total policy if he or she were unable to perform even one of his or her substantial and material duties of his or her occupation."
That expert, according to the doctor's attorneys, had also been involved in some of the insurance contract language changes that occurred in the 1970s.
"We took it right from the horse's mouth that the way we were reading the policy was the way it should be read," said Roos, citing the expert's affidavit as a key item in the mediation.
The plaintiff's attorney remarked that these types of scenarios were common because of the variety of language used in insurance contracts.
"Some say 'every one' and some say 'each and every,' — there's all kinds of language out there and I think it still could get better," Roos said.
His partner, Field, noted that he thought in many cases, such as this one, it still comes down to the meaning of the word "the."
He said, "People laughed about it when [former President] Clinton said it, but it's not funny in these cases."
Malingering Doubt
Despite the war of words, the plaintiff's attorneys also had to prove that their client was actually deserving of the disability benefits.
From a medical standpoint, Roos said he believed that the insurance company simply did not believe his client was disabled.
"They were gambling on my not being able to provide them, and ultimately a jury, objective evidence of [the plaintiff's condition]," Roos hypothesized. "I think they felt my client was a malingerer."
Fortunately, he found an expert who was prepared to back up his client's medical complaints with an affidavit that he had found proof of the radiation enteritis on a "cellular level."
Roos commented that it helped that the expert in question was a doctor from a local Harvard University-affiliated teaching hospital — "the guy that literally wrote the book on this condition," according to Roos.
When asked if they had other concerns during the preparation for this case, the plaintiff's attorneys admitted that going before an unpredictable jury is always a factor.
Field said that he was concerned about how a "highly educated [and] financially well-situated physician would relate to a jury" when the benefits he was seeking probably would have amounted to more than most jurors and even the judge make for a salary.
But both attorneys felt confident that their client would have succeeded in front of a jury as well because he was a "decent guy" who had stayed loyal to the same insurance company over the years by increasing his coverage with them rather than looking for another carrier.
"There's no way he could have been portrayed as a money-hungry guy who wanted to live on the dole," Roos remarked.
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January 7, 2002
