Many disability policies have a limitation on the amount of time, usually two years, that they will pay policy benefits for a disability caused by mental illness. Issues regarding the scope and applicability of the mental illness exclusion can arise where a physical injury or illness also results in mental incapacity which contributes to the inability to work. Common examples of mental health issues associated with a physical injury or illness are depression and anxiety.
On March 27, 2017, a California federal court in Los Angeles ruled that, under an ERISA policy, where mental issues are caused by a physical injury or illness, the 24-month mental illness limitation is inapplicable. In Doe v. Prudential Ins. Co. of America (2017) WL 1156725, the federal district court addressed a disability policy which limited benefits to 24 months when the disability is caused “in whole or part [by] mental illness.” (Id. at *1.) The insured submitted a disability claim for “HIV infection, pain, fatigue, osteoporosis, and severe depression.”. (Id. at *4.) Prudential, the disability insurer, approved the claim, but stated that the insured’s disability was caused by his depression and anxiety, not the physical ailments. (Id. at *5.) The insured had a history of depression since 1997. (Id.) Upon reaching the 24 months, Prudential terminated the insureds benefits. (Id. at *7.)
The court in Doe v. Prudential Ins. overturned the denial, holding that the insured suffered “disabling cognitive impairments that have a physical etiology.” (Id. at *14.) The court stated that the mental illness must be the “but-for” cause of the insureds disability to trigger the mental illness limitation. (Id. at *12.) The court emphasized that the insured’s cognitive impairments had a physiological etiology. (Id. at *14.) The Court noted that “if Plaintiff’s mental health issues were suddenly resolved, he would still” be disabled. (Id. at *15.) The court held that the mental illness limitation did not apply because the insured’s HIV diagnosis, a physical condition, was the but-for cause of his disability.
Along with other courts, Doe v. Prudential adopts a but-for analysis regarding whether a mental illness “in whole or in part” causes a disability, and thus falls under a mental illness limitation. Insureds who have been subjected to a mental illness limitation in connection with a disability claim may be able to use Doe v. Prudential, and its analysis, to challenge a mental illness limitation.