Protected Benefit - Definition of Disability

Company B is merging into Company A ( controlled group issue and surviving plan).

Company B's definition of disability - determined by a licensed physician

Company A ( the surviving plan) does not require physician approval. The document states The Participant is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve months. The permanence and degree of such impairment must be supported by medical evidence.  

Company A wants to use the Social Security Administration as the determination for disability. Is there a protected benefit issue here? Can the plan change licensed physician to Social Security and not have any protected benefit issue?

Disability benefits are ancillary, not part of the accrued benefit and may be amended (and eliminated, if desired) without issue. The only potential issue is if you have an existing disability claim or current disability stream of payments (like under a DBP). If your only concern in determination/definition of disability, no problem.

A plan's definition of disability may also affect vesting, forms of benefit payment, and whether there is a distributable event.  I think you have to consider what is impacted in your client's plan and proceed carefully, considering both Treasury Regulation Sections 1.411(d)-3 and 1.411(d)-4.

I agree with MWeddell. I tend to treat disability definition as protected if it impacts vesting, withdrawal rights, distribution rights, etc.  If the "new" definition is clearly and unambiguously easier for a participant to meet then there's no issue.