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A nurse anesthetist who found himself addicted to the painkillers he was prescribing may not collect long term disability benefits (LTD), according a decision of the 4th Circuit of the US Court of Appeals. 

Robert Stanford worked at a South Carolina hospital where he became addicted to Fentanyl, a narcotic painkiller. He entered a rehab center and completed treatment but relapsed after returning to work. Stanford went back to an addiction treatment center for 3 months before returning to work. While being treated, he applied for and was granted LTD by Continental Casualty, which also insured and administered his plan.

Unfortunately, Stanford began using Fentanyl again and reentered rehab. His claim for LTD was approved but he was advised his claim was under review. After his release, his treating physician informed Continental that Stanford was no longer disabled and could return to his job as a nurse anesthetist. Based on the doctor’s report, Continental terminated Stanford’s benefits.

Stanford appealed the termination and submitted documentation including a report from his physician that he remained at high risk for relapse if he was exposed to Fentanyl along with a medical treatise confirming the high potential of relapse among nurse anesthetists. Stanford was also no longer to work in his occupation, having had his license as a certified nurse anesthetist severely restricted.

Stanford’s administrative appeal was denied based on Continental’s discretionary authority to determine that “potential risk” was not covered under its policy. A district court agreed and granted summary judgment to Continental, essentially stating that it was entitled to judgment as a matter of law.

To win on a court appeal, Stanford had to argue that Continental abused its discretion in denying him LTD and that there was a conflict of interest in Continental acting as both insurer and administrator.

The appellate court, though, found no abuse of discretion and had no qualms about Continental’s dual role in deciding its own actions were reasonable. The court seemed to address the issue of whether the high risk of relapse rendered Stanford disabled or unable to perform his usual occupation by only saying that there are cases that hold both ways.

Under the standard of abuse of discretion, if reasonable minds can differ, then there is no abuse. In this case, though, the court wrestled with the paradoxical conclusion that Stanford could only qualify for benefits under the plan if he returned to work and suffered a relapse, which he was highly likely to do. This would seem to encourage someone to abuse drugs so that he or she could collect benefits, while punishing the addict who struggles to maintain sobriety but who is ineligible for the same benefits.

As in many cases, the court tried to balance competing interests. The cost of not being able to collect LTD was apparently outweighed by the potential success that awaited Stanford by his not being able to return to his prior profession.


Stanford v. Cont'l Cas. Co., 514 F.3d 354 (4th Cir. 2008)



No. 06-2006


Appellant Stanford is a trained nurse anesthetist, a health care professional responsible for administering anesthesia to patients undergoing surgical and obstetric procedures. Stanford was employed in this capacity at the Beaufort Memorial Hospital in Beaufort, South Carolina beginning in April, 2002. Among the drugs Stanford administered was Fentanyl, a powerful painkiller and narcotic. Stanford began self-administering Fentanyl, and by September 2003 he was addicted to the drug.

Stanford left his position at Beaufort and entered an addiction treatment and rehabilitation program in October 2003. After completing the program, but before returning to work, Stanford relapsed and entered a second treatment program in November, 2003, where he remained for three months. Stanford was discharged in late February, 2004, and was approved to return to work on March 8, 2004.

While attending this second treatment program, Stanford applied to appellee Continental for long term disability benefits. Continental, which both insured and administered Beaufort's employee benefit plan, approved Stanford's application.

Stanford returned to work on March 12, 2004, but quickly began taking Fentanyl again. He left work for a second time on May 19, 2004 and again sought treatment for his drug use. While undergoing treatment in Georgia, Stanford again applied to Continental for long term disability benefits. Continental approved this second application for the duration of Stanford's inpatient treatment in Georgia, but notified him that his claim remained under review.

In December, 2004, a registered nurse consultant with Continental spoke to Stanford's treating physician, who indicated that Stanford no longer suffered any impairment that would prevent him from performing the duties of his occupation as a nurse anesthetist. Based on this representation, Continental terminated Stanford's long term disability benefits in January, 2005.

Stanford requested administrative review of the termination decision, providing letters from his treating physician indicating that Stanford remained at risk for relapse if exposed to Fentanyl, as well as an article from a medical treatise discussing the risk of relapse among anesthesiologists. Stanford also indicated that the South Carolina Board of Nursing had restricted his license, prohibiting him from having access to narcotics or working as a Certified Registered Nurse Anesthetist.

Continental, acting pursuant to its discretionary authority as plan administrator,1 denied Stanford's appeal on February 21, 2005, writing that "the policy does not cover potential risk," and that Stanford was therefore not entitled to further long term disability benefits. Having exhausted his administrative remedies, Stanford filed the present lawsuit seeking to reverse Continental's denial of benefits. The district court granted Continental's Motion for Summary Judgment on August 7, 2006, and Stanford appeals.

Stanford argues that Continental abused its discretion in two respects when it denied him long term disability benefits in January, 2005. First, he argues that Continental applied an unreasonably restrictive interpretation of the benefit plan when it concluded that the plan did not apply to the potential risk of relapse. Second, he  argues that Continental violated ERISA regulations by issuing its denial of benefits without consulting a health care professional. We address each argument in turn.

Stanford first argues that Continental's interpretation of the terms of the benefit plan was unreasonably restrictive. Although Continental did not contest Stanford's characterization of his addiction as a sickness, it concluded that since Stanford no longer suffered from physical or mental impairments as a result of his drug use or his recovery, the fact that he remained an addict did not render him "unable to perform the material and substantial duties of [his] regular occupation."

Stanford argued in his administrative appeal that his addiction did render him unable to perform his duties because of the high risk that he would relapse into drug use if exposed to Fentanyl in the workplace. Continental rejected this argument, concluding that "[t]he policy does not cover potential risk" of relapse. We cannot say that Continental's conclusion is unreasonable, even in light of Continental's conflict of interest as insurer and administrator of the benefit plan, and we must accordingly affirm.2

More apposite are those cases cited by Stanford in which courts have found the risk of relapse to satisfy definitions of disability similar to the language of the benefit plan here.5 But these cases do not [F.3d 359] settle the matter, both because they are not authoritative and because there exist directly contradictory cases.6 This disagreement among the courts demonstrates that reasonable minds can, and do, differ as to whether the risk of relapse renders an addict unable to perform the material and substantial duties of his work. Given this widespread, thoughtful, and reasonable disagreement, Continental's decision cannot plausibly be termed unreasonable.7

We are not unsympathetic to Stanford's argument that Continental's policy would require him to return to work and in fact suffer a relapse in order to qualify for long term disability benefits. We recognize that this creates a somewhat troubling - some might say perverse - incentive structure: an addict who continues to abuse drugs will be entitled to long-term benefits, but upon achieving sobriety will lose those benefits unless he again begins to abuse drugs. Although this argument is not without force, it operates on a false assumption, namely that disability benefits are a sort of reward for sobriety. In fact, sobriety's reward is the creation of innumerable opportunities that were closed to Stanford as long as he continued to use drugs. These newfound opportunities do not include a return to his former job as a nurse anesthetist, but this is the result of a license limitation and the prudence of employers, not any physical disability or mental impairment. No prudent employer would hire Stanford into a job in which he administered the drug to which he is addicted, just as no prudent employer would hire a recovering alcoholic as a bartender. More importantly, no prudent addict would place himself in such a position. Such prudence is a part of recovery, and it can have significant costs - but these costs are greatly outweighed by the opportunities sobriety provides. It is important to remember that Stanford is not physically disabled or mentally impaired; though prudence and his license dictate that he cannot return to his old job administering Fentanyl, he is physically and mentally capable of performing that job - and countless other jobs. It would be truly perverse if Stanford were to go on to great success in another occupation but was still able to [F.3d 360] collect

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Ben Glass is a nationally recognized car accident and ERISA disability attorney in Fairfax, VA.