Ignoring Social Security Evidence is an ERISA Abuse of Discretion

• SSDI Comes Second:

  • Many long-term disability claimants also successfully obtain Social Security Disability Insurance benefits.

  • Because of the time it takes to obtain SSDI, that benefit usually kicks in while LTD benefits are being paid, sometimes years after the original out-of-work date.

  • In the February 2025 decision Smith v. Cox Enterprises, the Fourth Circuit underlined that plan administrators must address with specificity the reasons why a plan is deviating from an SSDI determination when the record contains SSDI evidence.

• The Facts:

  • Jeremy Smith worked as a Customer Care Technician before becoming disabled due to back problems.

  • He received disability benefits for seven years before plan administrator Aetna determined he was capable for work and ineligible for further benefits.

  • On administrative appeal Smith submitted records of his visit with a physician as part of the SSDI recertification process.

• Ignoring Social Security Evidence is Error

  • Aetna included identical language in Smith’s termination and appeal denial letters, commenting that “our disability determination and the SSD determination are made independently and are not always the same ... that may be driven by the Social Security Administration (SSA) regulations … [or] it may be driven by the fact that we have information that is different from what SSA considered.”

  • The Fourth Circuit held these conditional statements “do not constitute a ‘discussion of the decision’ within the meaning of the regulations” and that “Aetna does not state why it reaches the opposite conclusion of the Social Security Administration; rather, it merely suggests possible reasons that the Social Security Administration's determination could be discounted.”

  • The Fourth Circuit noted many federal courts, including the Ninth Circuit in Salomaa v. Honda LTD Plan, have adopted the rule that failing to address Social Security’s decisions supports finding an abuse of discretion.

  • The SSDI doctor’s report went undiscussed in Aetna’s communications, and the court held that “[t]he failure to address conflicting evidence—especially the highly probative evidence created for the Social Security Administration—denied Smith his statutory right to "a full and fair review." 29 U.S.C. § 1133(2).”