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Disability plans


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Court Finds Pregnancy is Not a Pre-existing Condition for Subsequent Disability Claim
"The court concluded that the policy would essentially require a claimant to be in perfect health at the time of obtaining the policy before the policy would benefit the claimant during the succeeding 12-month period, which would be next to impossible for anyone.... [T]he Eleventh Circuit rejected the insurer's 'but for' argument (i.e., that but for the insured's pregnancy, she would not have developed high blood pressure; but for her high blood pressure, she would not have developed preeclampsia; but for her preeclampsia, she would not have suffered a stroke; and, finally, but for her stroke, she would not have become totally disabled) on the basis that it required too many links." [Bradshaw v. Reliance Standard Life Ins. Co., No. 16-11125 (11th Cir. Aug. 31, 2017; unpub.)] (The Wagner Law Group)
[Guidance Overview] Nonqualified Plans May Need to Be Updated for New Disability Claims Procedure Regs
"While nonqualified deferred compensation plans are generally exempt from most of the substantive provisions of [ERISA], Nonqualified Plans are still subject to ERISA's enforcement provisions, including claims regulations implementing section 503 of ERISA. For that reason, a Nonqualified Plan must contain claims procedures that comply with the ERISA claims regulations for resolving participant claims under Nonqualified Plans." (Trucker Huss)
Eleventh Circuit: Healthy Pregnancy Is Not a Pre-Existing Condition for Disability Caused By Stroke (PDF)
"Bradshaw had a healthy pregnancy and no other pre-existing medical conditions when she bought a disability-insurance policy ... [N]ine days after Bradshaw gave birth to her daughter, tragically, Bradshaw suffered a debilitating stroke. So Bradshaw filed a claim for long-term disability benefits with Reliance, which Reliance denied ... because of Bradshaw's healthy pregnancy at the time she purchased her policy; Reliance asserted that qualified as a pre-existing condition that 'contributed to' Bradshaw's stroke.... Reliance's determination was unreasonable. So we reverse and remand the case to the district court for an award of ERISA benefits." [Bradshaw v. Reliance Standard Life Ins. Co., No. 16-11125 (11th Cir. Aug. 31, 2017; unpub.)] (U.S. Court of Appeals for the Eleventh Circuit)
When Bad Surgery Results Create New Disabling Conditions: Still Excluded from Disability Plan Coverage by the Pre-Existing Condition Exclusion?
"Pre-existing condition exclusions can be difficult to apply, especially when addressing whether a new disabling condition relates back to a pre-existing condition. But this new case shows how a new disabling condition resulting from a 'bad surgery' may still be excluded under the pre-existing condition exclusion." [Haddad v. SMG Long Term Disability Plan, No. 16-1700 (E.D. Cal. Aug. 22, 2017)] (Lane Powell PC)
Are Your Plans Impacted by the New Regs on Disability Claims?
"The Final Rule governs employee benefit plans subject to ERISA that offer disability benefits, not just disability plans. In addition to disability plans, it is not unusual for a retirement plan to provide disability benefits. It is also common for ERISA-covered benefit plans to waive premiums or provide some other form of benefit in the event of a disability." (Graydon Head & Ritchey LLP)
The DOL's Final Rule on Disability Claims Procedures: What Changes Do You Need to Make?
"[1] [D]enial notices must contain specific reasons for an adverse determination and basis for departing from previous rulings... [2] [C]laimants must be informed of their right to request and obtain the entire file upon denial of a claim, not just upon denial of an appeal.... [3] [B]enefit denial notices must be updated to include the plan's internal rules, guidelines, protocols and criteria used to adjudicate the claim[.]" (Graydon Head & Ritchey LLP)
DOL to Review Disability Claims Procedure Regs
"DOL recently announced that it will review ERISA's disability claims procedures regulations for questions of law and policy to determine if they should be amended, delayed, or withdrawn. The regulations ... were finalized in December 2016 and slated to take effect for claims made on or after January 1, 2018 ... An announcement of this nature is fairly uncommon so it is likely, but not a certainty, that DOL will delay and/or amend the final regulations." (The Wagner Law Group)
DOL Announces Review of Regs on Disability Claims
"[T]hese rules also apply to ERISA-governed retirement plans that make disability determinations.... While nonqualified retirement plans are exempt from many ERISA requirements, the claims procedures requirement is not one of them.... These new disability claims procedure regulations do not apply to any plan (health and welfare plan or qualified/nonqualified retirement plan) that provides a benefit the availability of which is conditioned on a finding of disability made by a party other than the plan itself." (Porter Wright Morris & Arthur LLP)
State Offset Statutes Put Brakes to Insurer's Effort to Half Disability Benefits
"A recent ruling from the [Second Circuit] looked at whether a disability insurer could properly offset an insured's personal-injury recovery and decided that Section 5-335 of the New York General Obligations Law precluded the claimed offset. Section 5-335 provides that personal-injury settlements 'shall be conclusively presumed' not to include 'any compensation for the cost of health-care services, loss of earnings or other economic loss[es]' that 'have been or are obligated to be paid or reimbursed by an insurer.' The court held that the New York statute survived an [ERISA] pre-emption challenge and precluded Aetna's efforts to reduce Savatore Arnone's disability benefits." [Arnone v. Aetna Life Ins. Co., No. 15-2322 (2nd Cir. June 22, 2017)] (DeBofsky, Sherman & Casciari, PC)
[Guidance Overview] Administration Looks to Delay or Amend Disability Claims Regs
"The [DOL's] regulatory agenda was updated on July 20 to include a project to 'delay or amend' the final regulations on disability claims procedures. The abstract included for this agenda item indicates that the DOL is reviewing the final regulations for 'questions of law and policy' and schedules a notice of proposed rulemaking for September 2017.... Although the DOL's updated agenda clouds the future of these regulations, it is possible they will take effect as scheduled in the same or similar form." (Willis Towers Watson)
[Guidance Overview] Disability Claims Procedures Must Comply with New Regs Starting in 2018
"These regulations apply to ERISA-covered short-term and long-term disability plans, as well as retirement plans that provide disability benefits that require disability determinations by the plan administrator ... The new disability claims procedures are largely meant to track, with some differences, the enhanced disclosure and claims procedures established for medical claims by the [ACA]. [Here] are the key components that employers and plan administrators should consider." (Proskauer's ERISA Practice Center)
District Court Allows Veteran to Proceed with Claim Employer Reduced His Salary by Disability Benefits Amount
"Refusing to dismiss a former marine's USERRA discrimination claim, a federal district court in Florida found that he sufficiently alleged that the employer reduced his pay by the amount of disability benefits he received from the Department of Veterans Affairs (VA), which was the same as claiming that military service was the 'motivating factor' for the adverse decision.... [T]he court rejected the owner's assertion that he could not be individually liable, because the employee claimed the owner exercised control over the terms of employment and was the individual who made the adverse pay decision." [Rimbey v. The Mucky Duck, Inc., No. 17-103 (M.D. Fla. June 29, 2017)] (Wolters Kluwer Law & Business)
Disability Plan Can't Offset Pension Benefits Rolled Into IRA
"The Verizon SPD warned that certain benefits offset long-term disability benefits, including 'pension plan benefits from a Verizon pension plan if you elect to receive them.' The case turned on the phrase 'elect to receive.' ... [T]he 5th Circuit held that because the pension benefits were rolled over into an IRA, [the participant] did not 'receive' them. Thus, MetLife could not offset those pension benefits." [Thomason v. Metro. Life Ins. Co., No. 16-10634 (5th Cir. July 18, 2017; unpub.)] (Thompson Coburn)
[Guidance Overview] The Case for Tackling the New Disability Claims Procedures Before Year-End
"[K]ey changes implemented by the new rule are ... [1] New independence and impartiality provisions.... [2] Enhanced review rights.... [3] New deemed exhausted provisions.... [4] Expanded definition of adverse benefit determination.... [5] New culturally and linguistically appropriate standards.... [6] New disclosure requirements." (Benefits Bryan Cave)
Anatomy of an ERISA Disability Benefit Claim (PDF)
"Because the administrative record is often limited to the evidence that was before the administrator at the time it made the final claims decision, perfecting the claim and appeal is arguably the most important part of any benefits claim." (Plaintiff Magazine)
Why Do More New Englanders Receive Disability Insurance Benefits for Mental Disorders?
"A greater share of people in New England states receive Social Security Disability Insurance (DI) benefits for mental disorders than the share nationwide.... [E]vidence suggests that demographics and economics play a large role, as does greater access to health insurance and health care." (Urban Institute)
CalPERS Announces New Disability Retirement Mandates and Local Agency Audits
"CalPERS announced that it is auditing the industrial disability retirement (IDR) process for 60 contracting agencies.... [B]ecause many local agencies do not have a formal policy that sets forth the procedures for determining disability and industrial disability retirement, agencies should strongly consider adopting such a policy in light of the due process concerns related to the separation process and CalPERS' direction that such a policy is necessary." (Liebert Cassidy Whitmore)
Geographic Patterns in Social Security Disability Receipt
"In 2015, 1.8 percent of all 18- to 65-year-olds across the country received DI benefits because of mental disorders. That recipiency rate was markedly higher in Maine, New Hampshire, Rhode Island, and Vermont. The evidence suggests that access to and treatment from the health care system (which tend to be better in New England states) may help people identify their illnesses and contact the DI program and other services." (Urban Institute)
Second Circuit: New York Law Prohibits Insurance Company from Offsetting Personal Injury Settlement Against Long Term Disability Benefits
"Arnone argued that, because he is a New York resident who was employed in New York and injured in New York, N.Y. Gen. Oblig. Law Section 5-335 applies to his settlement and prohibits Aetna from reducing his LTD benefit.... [T]he court found that: [1] section 5-335 would prohibit Aetna's offset action as a matter of law and, for that reason, would render its decision arbitrary and capricious; [2] section 5-335 is a law that regulates insurance and is saved from express preemption under ERISA; [3] the Plan's choice of law provision sets forth only which jurisdiction's law of contract interpretation and contract construction will be applied, it does not bind the court to apply the full breadth of Connecticut law[.]" [Arnone v. Aetna Life Ins. Co., No. 15-2322 (2d Cir. June 22, 2017)] (Roberts Bartolic)
ERISA Plan Choice-of-Law Provisions: Disability Claim Reviewed Under Abuse of Discretion Standard of Review
"The Court rejected Plaintiff's argument that de novo review should apply because Indiana law disfavors discretionary review.... Courts are not consistent on what effect choice-of-law provisions have on the standard of review. Many courts have determined, for example, that state law prohibitions of discretionary clauses fall within ERISA's savings clause and are not preempted by ERISA." [Kalnajs v. The Lilly Extended Disability Plan, No. 16-62 (W.D. Wis. June 14, 2017)] (Lane Powell PC)
Court Questions Insurer's About-Face on Paying Disability Benefits
"The court was clearly skeptical of an insurer's decision that overturned nearly eight continuous years of benefit payments for a chronic, degenerative medical condition. Although the case was not entirely clear-cut, the actions taken by Unum following Hart's rejection of a buyout offer were suspicious and resulted in the court's determination that there was no reasonable basis for Unum's findings." [Hart v. Unum Life Ins. Co. of America, No 15-5392 (N.D. Cal. May 24, 2017)] (DeBofsky, Sherman & Casciari, PC)
[Guidance Overview] DOL Final Rule Regarding Disability Claims and Appeals Now in Effect
"Plan sponsors should review health and welfare and pension plans to determine if they are subject to the final rule. Most plans will have already made this determination in response to the original regulations issued in 2000, but if the responsibility for making the disability determination has changed through the years, plan language [should] be reviewed and revised as necessary. Summary plan descriptions (SPDs) must be amended to add language implementing the new rules. In addition, a determination should be made as to whether document language and administrative practices remain in alignment." (Segal Consulting)
Quick Responses to Claimant's Typical Challenges to Disability Benefit Denials
"[T]he claims administrator determined Chen could perform a sedentary job and terminated benefits after 19 years.... The Court rejected Plaintiff's argument that Standard had made inconsistent prior decisions.... The Court rejected Plaintiff's argument that Standard had failed to consider the Social Security determination.... The Court rejected Plaintiff's argument that Standard 'cherry-picked' the record.... It is OK to consider Claimant's vacation travel to Europe, Hawaii in determining whether she is disabled." [Chen v. CenturyLink, No. 15-1651 (D. Col. May 18, 2017)] (Lane Powell PC)
Last Week's Notable ERISA Decisions, from a Plaintiff's Perspective
Contains summaries of the facts and results in 25 recent ERISA-related court decisions, which are considered to be notable by this plaintiffs' law firm. The case descriptions are sorted by subject matter and jurisdiction, and include links to the court opinions. (Roberts Bartolic)
Lincoln National Ducks Political Consultant's ERISA Lawsuit
"Lincoln properly offset a former lawyer's disability benefits to account for money he received as a freelance political consultant, a federal judge ruled May 16. The lawyer argued that Lincoln wrongly offset his benefits before he reported this consulting income for tax purposes -- a practice he said affects beneficiaries across all Lincoln-issued disability policies. The judge rejected this claim because the lawyer hadn't first raised it through Lincoln's internal procedures." [Barber v. Lincoln Nat'l Life Ins. Co., No. 17-0034 (W.D. Ky. May 16, 2017] (Bloomberg BNA)
Most Americans Not Protecting Their Paychecks with Disability Insurance
"[A]mong employed Americans who do not have short- or long-term disability insurance provided by their employer, 43 percent say the reason is because their employer does not offer it. Only 14 percent say the reason they don't have it is because they cannot afford coverage; a combined 34 percent don't have policies through their employer due to other obligations or expenses they feel are higher priorities (12 percent), don't see the value (12 percent), or say 'I am healthy and don't need it' (14 percent)." (OneAmerica)
[Guidance Overview] Action Required Before Year-End: Disability Plans Claims and Appeals Procedures
"The newly issued final regulations took effect on January 18, 2017 and will apply to all disability benefits claims filed on or after January 1, 2018.... [Employers should] work with their disability plan insurance carriers, third party administrators, and attorneys to ensure that all underlying disability plans and associated documentation (including any ERISA wrap plans, Code section 125 cafeteria plans, and claims denial forms) are reviewed and updated to ensure legal compliance with the requirements for claims filings beginning January 1, 2018. The final regulations are lengthy, comprehensive, and require detailed review and analysis." (Fraser Trebilcock)
ERISA Benefits and a Claimant's Bankruptcy: When Judicial Estoppel Requires Dismissal of Lawsuits Seeking Long Term Disability Benefits
"The key is to determine when the 'potential cause of action' accrued. And a recent case says those claims 'accrue' when the claimant receives the initial benefit denial letter." [Byrd v. Wellpoint Flexible Benefit Plan and Anthem Life Ins. Co., No. 17-008 (E.D. Mo. May 2, 2017)] (Lane Powell PC)
Disability: The Underappreciated Risk
"Employers can help their employees by educating them ... and by offering and encouraging participation in group long-term disability insurance. Wellness programs that detect health risks before they become chronic conditions can reduce the risk of disability. And, thanks to regulations issued in 2014, it now may be easier for employers that sponsors DC plans to protect their workers from the short- and long-term financial ruin that often accompanies a disability." (Bryan, Pendleton, Swats and McAllister, LLC)
[Guidance Overview] Death of the Substantial Compliance Doctrine?
"The days of the substantial compliance doctrine ... appear to be at an end in the Second Circuit. But plan fiduciaries expecting to rest easy, because their ERISA disability benefits litigations are likely to arise elsewhere, should think again. On December 16, 2016, the DOL issued final revisions to the Claims Procedure regulation ... [P]lan fiduciaries can likely expect courts all over the country to increase scrutiny of administrators' claim handling procedures, especially with respect to disability claims." (Jackson Lewis P.C.)
[Guidance Overview] New Claims Procedure Requirements for Disability Claims
"[If] a plan treats a participant as being disabled, based [solely] on being granted an award of a Social Security disability benefit, the plan's claims procedures would not have to reflect or apply the prior or new rules in the regulations that apply to disability claims.... If the plan retains any other requirement for treating a participant as being disabled, such as the plan administrator retaining any authority to challenge and deny such treatment despite the grant of a Social Security disability award, then the plan would have to handle a participant's claim for a disability benefit wholly or partly in accordance with the (prior and new) rules in the regulations relating to disability claims." (Cary Kane ERISA Lawyer Blog)
[Guidance Overview] The DOL's Revised Regs Applicable to Disability Benefit Claims
"The easiest requirement to meet will be the inclusion of a statement as to when the limitations period will expire ... Writing decisions in a culturally and linguistically appropriate manner also should not present too much difficulty.... Insurers and benefit plans will also need to instruct their claims personnel and any consultants they retain on how to address conflicting opinions and Social Security findings. It will no longer suffice to simply note disagreement or assert that Social Security utilizes different standards." (DeBofsky, Sherman & Casciari, PC)
[Guidance Overview] DOL Boosts Disability Claimant Protections
"During the review process, disability claimants must be guaranteed the right to present evidence supporting their claim and to respond to any new information prior to the final decision. They must also be given notice and a fair opportunity to respond if benefits are to be denied on appeal based on new evidence or rationales not used to deny the benefit at the claims stage." (Fisher Phillips)
Disability Plans Must Follow Claims Procedures Final Rule
"[T]he DOL is attempting to create a more comprehensive review of disability claims, clearly hoping to reduce the need for participants to resort to litigation and reduce difficulties participants experience with delayed claims processing ... A defined benefit pension plan may be affected by these regulations ... [T]he regulations will impact only those pension plans under which a plan fiduciary -- rather than the employer's long-term disability insurer -- makes an independent determination of a participant's disability." (Society for Human Resource Management [SHRM])
[Guidance Overview] DOL Finalizes Regs on Disability Plan Claims Procedures (PDF)
"The vast majority of employers offering disability benefits buy long-term disability insurance, in which case the burden of complying with the new claim processing regulations falls predominantly on the insurer. Additionally, employers typically offer short-term disability benefits through a payroll practice (e.g., salary continuation). Payroll practices are not subject to ERISA, and so the new rules would not apply to those types of arrangements." (Lockton)
Leave Management Continues to Vex Employers, but Outsourcing and Integrated Systems Help
"Outsourcing of [FMLA] administration continues to increase ... 34 percent of employers with 50 or more employees outsource FMLA leave to a third-party administrator (TPA). 45 percent of employers with 1,000 and more employees do so. 80 percent of employers that also outsource management of short-term disability (STD) and long-term disability (LTD) leave do so through the same TPA that manages FMLA leave on their behalf." (Society for Human Resource Management [SHRM])
[Guidance Overview] ERISA Disability Claim Regulations Get a Facelift
"Plans must ensure independence and impartiality of persons involved in claims determinations ... [P]ractitioners, employers, and administrators should expect that plaintiffs will use the rule in litigation to engage in broad-reaching 'conflict' discovery.... [W]hile the rule is intended to reduce conflict and claim disputes, it probably does little to change how plans already operate on this front.... [It] threatens to increase discovery and litigation costs, contrary to ERISA's goals." (Lathrop & Gage, LLP)
Are Your 'Voluntary' Benefit Plans Subject to ERISA?
"[T]here are four requirements of the voluntary plan safe harbor.... The benefit plan must be completely voluntary and employee paid, with no employer contributions made in any form for any employees.... [T]he employer must not endorse the plan. In simple terms if you endorse it, you own it (for purposes of ERISA) ... Finally, under the safe harbor, employers are prohibited from receiving any compensation that exceeds reasonable reimbursement for collecting and remitting premium payments." (Graydon Head & Ritchey LLP)
Seven Things to Know About Limited Discovery in ERISA Long-Term Disability Cases
"[D]iscovery in ERISA cases is generally limited because of the 'significant ERISA policy interests of minimizing costs of claim disputes and ensuring prompt claims-resolution procedures.' Various circuits have different tests on when additional discovery may be taken beyond the administrative record. And, if limited discovery is allowed, then what discovery is allowed? [A] recent case ... highlights the point." [Aitken v. Aetna Life Ins. Co., No. 16-4606 (S.D.N.Y. Jan. 19, 2017)] (Lane Powell PC)
[Guidance Overview] Which Plans are Subject to the DOL's Final Rules for Disability Claims Procedures?
"The DOL noted that nearly two-thirds of all ERISA litigation involves claims under long-term disability plans, and the final rules are intended to improve the 'full and fair review' of disability claims ... by expanding the procedural requirements.... In order for the new rules to apply, both of the following must be true: [1] the plan must make disability determinations affecting plan benefits; and [2] the plan must be subject to ERISA's claims procedures." (Haynes and Boone, LLP)
District Court: Diagnosis Is Not Automatically Equivalent to a Finding of Disability
"[M]ere diagnosis of a condition (like fibromyalgia) is not enough to qualify for disability benefits under most policy definitions.... [The court found that it] was a problem that the treating physician 'diagnosed plaintiff with fibromyalgia [but] did not indicate whether she would be able to return to work or if her condition would be permanent.'  " [Decovich v. Venetian Casino Resort, No. 11-872 (D. Nev. Jan.26, 2017)] (Lane Powell PC)
[Guidance Overview] DOL Disability Regulations and the Impact on ERISA Plans
"[T]he majority of the ERISA plans impacted by these regulations will be health and welfare plans that provide disability benefits ... An ERISA pension plan may be impacted by these regulations if it provides for early or unreduced benefits in the event of disability. However, the regulations will impact only those pension plans under which a plan fiduciary (rather than an external entity such as the Social Security Administration or the employer's long-term disability insurer) makes an independent determination of a participant's disability." (Spencer Fane)
[Guidance Overview] DOL Issues Final Rule on Disability Benefit Claims and Appeals
"Employers should update all relevant disability benefit plan documents, SPDs, claims forms, denial letters and related systems to comply with the changes to the final requirements for claims and appeals by the effective date. Employers also might want to discuss with legal counsel the possibility of adding details about any contractual limitation periods on claims to all ERISA-covered plans, SPDs and denial letters, as the DOL seems to be taking the position that the requirement is not limited to disability claims." (Willis Towers Watson)
[Guidance Overview] DOL Publishes Final Regs on Disability Claims and Appeals Procedures (PDF)
"The final rule revises and strengthens the current rules primarily by adopting certain procedural protections and safeguards for disability benefit claims that are currently applicable to claims for group health benefits pursuant to the [ACA]." (United Actuarial Services, Inc.)
[Guidance Overview] DOL's Final Rule Modifies ERISA Disability Claim Regulations
"Addressing conflicts of interest, the final rule requires decisions regarding hiring, compensation, termination, or promotion of persons involved in making claim decisions not be based on the likelihood the individual will support denial of benefits.... The final rule expanded the definition of 'adverse benefit determination' to include 'any rescission of disability coverage,' including 'cancellation or discontinuance of coverage that has a retroactive effect.' " (Womble Carlyle)
[Guidance Overview] DOL Finalizes Disability Claims Procedure Rules (PDF)
"The DOL has finalized regulations that will change the procedures ERISA plans must follow in adjudicating claims for benefits conditioned on a determination of disability, including claims for disability retirement benefits. The final rules, which generally follow the proposed regulations, add a requirement that notices of an adverse benefit determination on review set out specific information about plan-mandated deadlines for bringing lawsuits under ERISA." (Conduent)
Seventh Circuit Lists Ways to Inoculate Claims Denials from Allegations That a 'Conflict of Interest' Affected Your Decision
"[A] record showing that the claims administrator changed its decision over time can help disprove allegations that a 'conflict of interest' played a role in the claims decision. [A] recent case ... explains four ways to inoculate claims from allegations that a conflict of interest affected the claims decision." [Geiger v. Aetna Life Ins. Co., No. 16-2790 (7th Cir. January 6, 2017)] (Lane Powell PC)
[Guidance Overview] DOL Finalizes Disability Benefit Plan Claims Regs
"The finalized regulations require: Independence and impartiality in decision-making ... Improved disclosure ... Rights to review and respond to new information or new rationale before final decision ... Disclosure of any contractual limitations period in denial notices ... Deemed exhaustion of claims and appeals processes ... Retroactive rescissions of coverage are appealable ... 'Culturally and linguistically appropriate' notices." (Trucker Huss)
[Guidance Overview] New ERISA Disability Rules Look to Level Playing Field for All
"Besides requiring an explanation for disagreement with treating doctor opinions, the regulations speak to situations where the Social Security Administration issues an award of disability benefits while the benefit plan reaches a contrary determination. Although no deference to a favorable Social Security determination is required, the regulations obligate benefit plans to provide "a more detailed justification [for reaching a different conclusion] ... in a case where the SSA definitions were functionally equivalent to those under the plan." (DeBofsky & Associates, P.C.)
[Guidance Overview] New Disability Claim Procedures Require Strict Compliance
"If a plan violates any of the rules for disability claims, the claim is deemed denied without the exercise of discretionary authority. This gives the claimant the right to file a lawsuit without further delay and will allow a court to decide the merits of the claim de novo, without any deference to the fiduciary who violated the rules.... A copy of any internal rules and guidelines the plan relied upon must now be affirmatively provided without request to the claimant (or otherwise a statement that such materials do not exist)." (Greensfelder, via Lexology)
[Guidance Overview] DOL Issues Final Regs on Handling Disability-Related Claims
"[T]he Final Rule states that administrators of disability plans: (i) must provide more detail in adverse benefit decision letters (for both initial claim letters and appeal denial letters); (ii) adopt certain additional criteria to ensure independence and impartiality in the decision-making process; (iii) treat most rescissions as adverse benefit determinations; (iv) allow claimants to go directly to court if the claims procedures of the plan does not strictly comply with the requirements of the Final Rule; and (v) make disability claims subject to the same 'culturally and linguistically appropriate' rules as group health plan claims." (Benesch Friedlander Coplan & Aronoff LLP)
[Guidance Overview] Disability Claims Procedure Rules Changed to Require Plan Updates
"ERISA plan sponsors will need to review claim procedure language to determine whether updates are required. Such language may be present in the plan document, summary plan descriptions, or as standalone documents.... Minor regulatory changes ... apply to disability claims filed during a transition period beginning after the January 18, 2017 effective date and extending through December 31, 2017.... The remaining changes implemented under the regulation apply beginning January 1, 2018." (Michael Best & Friedrich LLP)
[Guidance Overview] The New ERISA Claims and Appeals Regulations for Disability Benefits
"The new regulations add the following requirements to the claims and appeals process for disability benefits: [1] Claims and appeals must be decided independently and impartially, meaning that those who decide claims should not be incentivized to deny claims.... [2] Denial letters must include [certain specified items] ... [3] Before an appeal can be denied, claimants must be given notice and a fair opportunity to respond if the appeal denial is based on new or additional rationales or evidence.... [4] Claimants are not barred from suing due to failure to exhaust the plan's claims procedures where the plan itself failed to comply with its claims procedures (except for certain minor failures). [5] Retroactive rescissions of coverage are considered benefit denials that trigger the plan's appeals procedures." (Jackson Lewis P.C.)
[Guidance Overview] DOL Releases Final Regulations for Disability Benefit Claims Procedures
"[P]articipants may now appeal rescissions of coverage. However, a rescission based on the participant's non-payment of premiums is not an adverse benefit determination.... Plan administrators must explain the protocols that were used to determine the participant's benefit claim.... Plan administrators must inform participants, in benefit denial notices, that they are entitled to access, free of charge, all documents relevant to the adverse claim determinations." (The Wagner Law Group)
[Guidance Overview] Final DOL Regs Extend Enhanced Claims Procedure Rules to Disability Benefits
"The final regulations, which apply to claims for disability benefits filed on or after January 1, 2018, follow the proposed rules fairly closely. In general, they require more detail in denial notices (for both initial claims and appeals), impose additional criteria to ensure independence and impartiality in decisionmaking, treat most rescissions as adverse benefit determinations, allow claimants to go directly to court if a plan's procedures do not strictly comply with the requirements, and make disability claims subject to the same 'culturally and linguistically appropriate' rules as group health plan claims." (Thomson Reuters / EBIA)
[Guidance Overview] ACA Facelift to Disability Claims Process Could Affect All Plans
"For insured disability plans, plan sponsors need to engage their insurance carriers in a discussion about how these procedures will apply to them and what changes are needed to the insurance contracts. Some insurers may be slow to adopt these new procedures, which could put plan sponsors in a difficult position. For self-funded disability plans, plan documents will need to be updated, and procedures put in place. For retirement plans, there are some decisions to make. Recall that the procedures only apply if a disability determination is required. One way to avoid this is to amend the definition of disability so that it relies on a determination by the Social Security Administration or the employer's long-term disability carrier. For defined contribution plans, this is likely to be the most expedient approach." (Benefits Bryan Cave)
[Guidance Overview] DOL Issues Final Regs for Claims Procedure for Plans Providing Disability Benefits
"The keystone of the regulations ... is the requirement to allow the claimant to have the last word in the claims process and thus have the right to respond to adverse information developed during the claim appeal process.... The regulations are also intended to permit claimants to submit supporting evidence regardless of whether such evidence meets 'courtroom evidentiary standards.' " (DeBofsky & Associates, P.C.)
[Guidance Overview] Final DOL Disability Claims Regs Require Notice of Contractual Limitations Periods
"[A] benefit is a disability benefit subject to the disability claims regulations if a plan conditions the benefit's availability on a showing of disability (regardless of how the plan characterizes the benefit or whether the plan is a health or retirement plan).... [T]he final regulations: [1] Limit conflicts of interest by requiring independence and impartiality of plan decisionmakers. [2] Expand the content requirements for denial notices involving disability claims. [3] Provide claimants notice and an opportunity to respond prior to appeal-level denials based on new or additional evidence or rationales.... [4] Require that claims notices be provided in a culturally and linguistically appropriate manner." (Practical Law Company)
[Guidance Overview] DOL Fact Sheet: Final Rule Strengthens Consumer Protections for Workers Requesting Disability Benefits from ERISA Employee Benefit Plans (PDF)
"[T]he final rule includes the following improvements in the requirements for the processing of claims and appeals for disability benefits: [1] Improvement to basic disclosure requirements.... [2] Right to claim file and internal protocols.... [3] Right to review and respond to new information before final decision.... [4] Avoiding conflicts of interest.... [5] Deemed exhaustion of claims and appeal processes.... [6] Certain coverage rescissions are adverse benefit determinations subject to the claims procedure protections.... [7] Notices written in a culturally and linguistically appropriate manner." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
[Official Guidance] Text of DOL Final Regs: Claims Procedure for Plans Providing Disability Benefits
98 pages. "This document contains a final regulation revising the claims procedure regulations under [ERISA] for employee benefit plans providing disability benefits. The final rule revises and strengthens the current rules primarily by adopting certain procedural protections and safeguards for disability benefit claims that are currently applicable to claims for group health benefits pursuant to the [ACA]. This rule affects plan administrators and participants and beneficiaries of plans providing disability benefits, and others who assist in the provision of these benefits, such as third-party benefits administrators and other service providers." (Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])

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