Archives for July 2018

HAVING A LAWYER BY YOUR SIDE IS CRUCIAL

THE FIRST STEP IS TO APPEAL YOUR DISABILITY CLAIM DENIAL

After your claim for long term disability benefits has been denied, the appeal process begins by submitting a letter in writing outlining all of the reasons you disagree with the denial decision and why you are disabled. If the insurance company denies your appeal, you may then file a lawsuit in federal district court in which the court may grant or restore your disability benefits. There is often a misperception that because of this two step process, claimants do not need a lawyer until after the appeal is denied when it is time to file the lawsuit. This could be further from the truth.

YOUR APPEAL LETTER WILL BE USED IN COURT

It is crucial that you hire a lawyer to help you with the appeal process because you will not get a second chance to make your case. Most people don’t realize that the success or failure of their court case will be determined by the appeal letter they submit to the insurance company. This gives the insurance companies a big advantage, because many claimants may first try to reason with their disability carrier by filing an appeal letter that they write themselves, without the expertise of a lawyer.

ONCE IN COURT, YOUR CASE WILL BE DECIDED SOLELY ON THE APPEAL LETTER AND INFORMATION GATHERED BY THE INSURANCE COMPANY. YOU WILL NOT BE ABLE TO TESTIFY, AND, FOR THE MOST PART, ARE BARRED FROM PROVIDING NEW INFORMATION.

As a result, writing your own appeal letter, without a lawyer, can be a mistake that prevents you from getting the benefits you deserve. That’s because your success in court will depend solely upon the contents of your first appeal letter. In court, the judge will only be able to examine your appeal letter and the reasons the insurance company denied your claim. This is referred to as the “Administrative Record”. So, if you handle the appeal yourself, and the appeal is denied, you will not be able to submit any new information to the court.

THERE ARE NO SECOND CHANCES; YOU NEED A LAWYER TO PREPARE YOUR APPEAL LETTER.

That’s why you need a lawyer from the very beginning of your appeal, before you file an appeal letter with the insurance company. Claire Bushorn Danzl, Esq. will work with you and your treating physicians to make sure that your appeal letter is complete, and that it can serve as a basis for winning your case in court. Don’t go alone through this appeal process. Call The Bushorn Firm today for a free telephone consultation, so that you can get the long-term disability benefits that you are entitled to receive. For more information about The Bushorn Firm, click here.

1. THE BASICS

A federal law known as ERISA (Employee Retirement Income Security Act of 1974) is a complicated and comprehensive law that sets minimum standards for retirement and welfare benefit plans in private industry. ERISA does the following:

• Requires plans to provide participants with information about the plan including important information about plan features and funding.  The plan must furnish some information regularly and automatically.  Some is available free of charge, some is not.
• Sets minimum standards for participation, vesting, benefit accrual and funding.  The law defines how long a person may be required to work before becoming eligible to participate in a plan, to accumulate benefits, and to have a nonforfeitable right to those benefits.  The law also establishes detailed funding rules that require plan sponsors to provide adequate funding for your plan.
• Requires accountability of plan fiduciaries.  ERISA generally defines a fiduciary as anyone who exercises discretionary authority or control over a plan’s management or assets, including anyone who provides investment advice to the plan.  Fiduciaries who do not follow the principles of conduct may be held responsible for restoring losses to the plan.
• Gives participants the right to sue for benefits and breaches of fiduciary duty.
• Guarantees payment of certain benefits if a defined plan is terminated, through a federally chartered corporation, known as the Pension Benefit Guaranty Corporation.

2. WHAT TYPE OF BENEFITS ARE GOVERNED BY ERISA?

At the most basic level, ERISA applies to two types of plans: Employee Welfare Benefit Plans and Employee Pension Benefit Plans.

An Employee Welfare Benefit Plan is any plan, fund, or program established or maintained by an employer or by an employee organization, or by both, which provides any of the following benefits, through insurance or otherwise:

• health insurance
• group life insurance
• long-term disability (LTD) income
• severance pay
• funded vacation benefits
• apprenticeship or other training programs
• or day care centers, scholarship funds, or prepaid legal services

In most cases, health insurance, group life insurance, long-term disability insurance, and short-term disability insurance are provided through an HMO or Insurance company, such as Unum, Cigna, Liberty Mutual, MetLife, Aetna, Anthem, Sun Life, LINA, Mutual of Omaha, Matrix, The Hartford, among others. The employer purchases, for instance, a group long-term disability insurance policy to offer its employees. Is this plan subject to ERISA? Probably, although there are exceptions depending on the type of employer.

An Employee Pension Benefit Plan under ERISA is any plan, fund, or program established or maintained by an employer or by an employee organization, or by both, which provides retirement income to employees, OR results in a deferral of income by employees for periods extending to the termination of covered employment or beyond. Employee Pension Benefit Plans include:

• Profit-sharing retirement plans
• Stock bonus plans
• Money purchase plans
• 401(k) plans
• Employee stock ownership plans
• Defined benefit retirement plans

3. WHY DOES IT MATTER IF MY BENEFIT CLAIM IS GOVERNED BY ERISA?

ERISA will have a profound effect on how your claim should be handled- both by you and the insurance company. If your disability claim, for instance, is denied, then it is important that you contact an attorney with experience in ERISA. For instance, you would not be able to sue the insurance company most likely without “exhausting” your “administrative remedies”, which means appealing an adverse benefit determination with the insurance company. On appeal, the disability insurer must follow certain procedures, such as making a decision within a certain period of time, having a different qualified medical professional review your medical records, and review your medical condition in conjunction with the requirements of your policy’s definition of disability. You are also entitled to receive a copy of all relevant information used by the insurance company when making its decision to deny your claim. This includes not just medical records, but internal case notes, correspondence, medical opinions from outside consultants, any surveillance data, and any occupational data considered.

Although ERISA was enacted to protect individuals, it is commonly understood that ERISA actually protects insurers, not claimants as intended. Some of these reasons include:

• ERISA disability disputes can take a long time. Before any lawsuit, the claimant must “exhaust administrative remedies” by sending a written appeal to the denying insurance carrier. Denied claimants generally have 180 days to appeals, and insurers have up to 90 days to consider the appeal. This means that by the time the internal appeal process has concluded, 270 days have easily passed. During that time, the disabled person generally has no income whatsoever.
• If the disabled claimant also seeks Social Security Disability (SSD) income, the long term disability insurer usually is allowed to deduct the SSD income from the amount it owes the claimant. This is referred to as an offset. If the disabled person does not seek SSD income, the long term disability plan usually allows the insurance company to estimate the SSD income and offset it anyhow.
• ERISA allows insurers the discretion to administer their own policies. Essentially, if such discretion is allowed under the disability plan, then a denial can generally only be overturned only by a showing that the denial was “arbitrary and capricious.” This standard is very difficult to overcome. The court doesn’t look at whether you are disabled, but whether the insurer was “arbitrary and capricious” when it used its discretion to determine that you were not disabled.
• If the insurance company upholds its denial on appeal, then the only option left is to file a suit in the United States District Court. But a lawsuit under ERISA does not necessarily mean the individual will have his or her day in court, so to speak. This is because testimony is usually not allowed and cases are decided by judges, not a jury. Very rarely will the judge even be able to see the claimant in person. Instead, the case is decided on the “record”- meaning that the judge will only look at the lawyers written arguments and the “claims file”, which is comprised of everything the insurer had before it when it made the decision to deny the individual’s benefit claim

Unfortunately, very few people have the stamina or resources to put up a fight against the disability insurance companies, and they know this. If you had to stop working due to an illness or injury, you should be using this time to focus on your health, not dealing with the insurance company endlessly to figure out what new piece of information they need or tracking down all of your doctors to make sure your medical records have been sent. Many people do not challenge wrongfully denied benefit claims, and the insurance companies bet against you doing so.

Claire Bushorn Danzl takes viable long term disability cases on a contingency basis throughout Ohio and Kentucky. If you have been denied LTD benefits, contact The Bushorn Firm, LLC to see if you qualify for a free consultation.

Whether you realize it or not, Social Security Disability (SSD) Income plays an important role in your long-term disability insurance claim, regardless of whether you have been awarded SSD benefits or not.

1. Most long-term disability insurance policies require that you apply for Social Security Disability benefits. The insurance companies will even often connect you with a company that will help you with your Social Security Disability application. As an attorney, I have seen many instances where the third-party helping with a client’s Social Security Disability claim does not do an adequate job assisting my client. I always recommend that my LTD clients seek the advice of an attorney knowledgeable of Social Security Disability benefits.
2. Most long-term disability insurance policies provide that your long-term disability insurance benefits may be reduced by your monthly SSD benefit. This is referred to as an “offset”. It is important to speak with a knowledgeable long-term disability insurance and ERISA attorney who is familiar with proper calculation of these offsets.
3. If you do not apply for SSD benefits, many policies allow the insurance company to reduce your monthly long-term disability insurance benefit by an amount the insurance company estimates you could receive as SSD benefits if you had applied and been approved.
4. Many disabled individuals begin receiving long-term disability insurance benefits before their SSD Income benefit is approved. When this happens, the disabled person may end up owing the insurance company the difference between the long-term disability insurance benefit actually received, and the long-term disability insurance benefit the disabled person would have received had the SSD Income benefit been applied as an offset to the long toerm disability insurance benefit from the outset.
5. For instance, suppose Mary started receiving a long-term disability insurance benefit of $2,000 per month beginning June 1, 2014. Then, in December 2015 she is awarded Social Security Disability benefits of $1,500 per month beginning June 1, 2014. Assuming the long-term disability policy language permits it, her long-term disability insurance carrier could say that her new LTD monthly benefit is only $500 per month ($2,000-$1,500). As long as the policy permits it, her insurance carrier could also calculate a overpayment based on the difference between the amount she received ($2,000 per month) and the amount she should have received once the SSD offset is applied ($500). Some policies allow the disabled person to reduce their monthly LTD benefits so that when they are awarded SSD benefits, they do not owe the insurance company a large amount of money. It is important to speak with an ERISA long-term disability offset attorney if this situation arises.
6. A finding by the Social Security Administration that you are disabled should be considered by your long-term disability insurance carrier when considering your claim for LTD benefits. When appealing a denial, it is important to update the insurance carrier if your Social Security Disability claim was approved.
7. It is not uncommon for the insurance company to miscalculate the proper SSD Income offset amount, or commit another error which resulted in the disabled individual receiving less money from the insurance company. For instance, if you hired an attorney to represent you through the SSD claim process, the amount paid to your attorney should be subtracted from the overall offset. Contact Claire Bushorn Danzl today if you have a question concerning your SSD offset.

MEDICAL CONDITIONS AND PLAN LIMITATIONS, PART 1—Pre-Existing Conditions and Mental Health Limitations

Most long term disability plans contain limitations concerning the type of illness or injury that you have which could affect your claim. This article will discuss two of those limitations: “pre-existing” conditions  and mental health conditions.

1. Pre-Existing Conditions

Pre-Existing condition limitations essentially exclude you from receiving long-term disability benefits for an illness or injury that was diagnosed and/or treated within a certain period of time (often 90 or 180 days) before your LTD coverage began. It is not uncommon for insurance companies to review your medical records if you recently became eligible for LTD benefits to try to find a loophole to exclude you from being covered under the disability policy.

Whether or not the pre-existing condition limitation applies to your situation depends on several factors which should be evaluated by an attorney who regularly handles LTD claims. What does the policy language say? Were you actually treated or diagnosed with your disabling condition during the period of time specified in the policy? If your claim for long-term disability benefits has been denied due to the policy’s pre-existing condition limitation provision, you should contact an ERISA LTD attorney to review the denial immediately.

2. Mental Health Conditions

Another common long-term disability policy limitation concerns those who seek LTD benefits for mental health conditions. If you are unable to work due to a mental health condition, you may be limited under the Plan terms to receive benefits for a certain period of time—usually 12 or 24 months—even if you remain unable to work after longer than that.

As with any long-term disability policy exclusion, it is important to understand what the long-term disability policy actually says, how mental health conditions are defined in the policy, and the effect of inpatient treatment. It is not uncommon for insurance companies to misapply the policy exclusions.

Another common tactic insurance companies use to limit a disabled person’s long term disability benefits is to focus exclusively on the individual’s mental health conditions, ignoring the individual’s physical conditions. It is important to have an attorney who understands the difference between the “disabling” condition, and non-disabling conditions which may co-occur. Understandably, many individuals who have worked very hard their entire life and find themselves unable to continue working due to disability suffer from some degree of depression or anxiety. Unfortunately, many insurance companies will seize on a depression or anxiety diagnosis as a basis to limit the individual’s entitlement to long-term disability benefits to 12 or 24 months.

It is critical that you review your long term disability policy with an ERISA attorney in order to determine whether your benefits should be limited under a mental health condition limitation.

Some disability insurance policies explicitly require “objective medical evidence” in order to approve a participant’s legitimate claim. Yet even in the absence of any plan language, many disability insurance companies frequently deny legitimate claims for benefits if the severity of your condition can not be “objectively” verified through X-Rays, MRIs, or other medical tests. Whether an objective evidence requirement is even permissible under ERISA when the policy does not refer to any such requirement is a contested area of law and fact intensive.

What “Objective Medical Evidence” Plan Language Looks Like:

Long-Term Disability policy language varies and should be read by an attorney knowledgeable of ERISA LTD claims. However, an example of objective medical evidence is below:

Under the terms of the Plan, an employee is entitled to disability benefits if she suffers from “a medical condition supported by objective medical evidence, which (i) makes a Participant unable to perform any type of work as a result of a physical or mental illness or an accidental injury …”

“Objective medical findings include but are not limited to tests, procedures, or clinical examinations standardly accepted in the practice of medicine, for your disabling conditions.”

What Counts as Objective Medical Evidence If My Condition Involves Self-Reported Symptoms?

Many disability insurance companies look very critically at claims for benefits when the participant is disabled due to Fibromyalgia, Chronic Fatigue Syndrome, Lupus, Chronic Lyme Disease, Degenerative Disc Disease, Chronic Pain, etc. This is partially due to the fact that many of the symptoms of these conditions are “self-reported”, including pain, fatigue, confusion, dizziness, fever, chills, shortness of breath, tenderness, etc. There are physicians and diagnostic tests which can help confirm the severity of these disabling conditions, and updated medical literature can also help. Moreover, standard accepted clinical examinations should constitute Objective Medical Evidence when an illness is defined and diagnosed by self-reported symptoms.

Fibromyalgia:

Fibromyalgia deserves special attention because long-term disability insurance companies often invoke a policy’s “objective medical evidence” requirement in order to deny disabled participants claims based on a Fibromyalgia diagnosis. The insurance companies often argue that Fibromyalgia is comprised of self-reported or subjective symptoms and therefore cannot be objectively diagnosed. However, Fibromyalgia can be diagnosed using clinical examinations standardly accepted in the medical field.

It is critical that you review your long term disability policy with an ERISA attorney in order to determine whether it requires that your illness be confirmed by “objective” medical evidence or not, and whether such evidence can be required in your state or federal jurisdiction. It is very common for a lack of “objective medical evidence” to be a reason for your denial, when the disability policy does not contain any such requirement.

If you have any questions about your long-term disability claim, call Claire Bushorn Danzl at The Bushorn Firm today at 513-827-5771.

PROFESSIONALS’ CLAIMS FOR ERISA DISABILITY INSURANCE BENEFITS

The Bushorn Firm, LLC can help guide clients through this confusing process. If necessary, we can write the appeal on behalf of the client. Individuals appealing a denial often do not realize that the appeal is their last chance to include any new information in their file before it is closed. As a result, the appeal must be detailed, complete, and persuasive because no new information can be presented, even in court.  The mangled and complex rules associated with ERISA long-term disability insurance denials applies to everyone, no matter what your profession.

Yet common issues often arise in the representation of professionals, such as doctors, lawyers, those in the financial sector, engineers, etc. Some of these issues include:

• Salary calculation in determining benefit level;
• The definition of “own occupation”, which can, under certain policies, involve certain job duties;
• Issues related to transitioning the definition of disability from “own occupation” to “any occupation”, and whether “any occupation” may include positions unrealistic for the insured’s skill level.

ERISA long-term disability attorney Claire Bushorn Danzl has represented many professionals and is skilled in evaluating the relevant economic and professional factors in relation to the ERISA regulations.

PREPURCHASE POLICY REVIEW:

Seeking legal advice prior to selecting a long-term disability policy, usually for a medical group practice, is an important step to help avoid making a costly mistake. Although obtaining a policy may seem straight forward, not all policies are equal. There are many important differences in the definition of disability, the duration of benefits, the calculation of benefits, limitation on payments or offsets, the time for filing claims or bringing a lawsuit, etc. A pre-purchase policy review by The Bushorn Firm, LLC can prevent the purchase of a policy with hidden caveats and will help clients understand the policy terms as they relate to their profession.

PROFESSIONALS WITH A PRIVATE POLICY IN ADDITION TO A GROUP PLAN:

Almost all long-term disability policies include offset provisions, whereby certain types of other income may reduce the amount of an individual’s monthly long-term disability benefit. These typically include Social Security Disability Income, Workers Compensation benefits, some retirement benefits, etc. Depending on the terms of the plan, group policies generally do not offset a professional’s supplemental disability benefits offered through a private policy the individual purchased separately. Despite this, many insurance companies try to use those private individual long-term disability benefits as an offset even if the contract does not allow any such offsets. It is important to contact an ERISA long-term disability attorney who has experience reviewing policy language when determining the proper offsets that should be applied to your group long-term disability insurance benefits.

BONUSES AND COMMISSIONS AND THE EFFECT ON PROFESSIONALS’ LONG TERM DISABILITY BENEFIT CALCULATION:

Each long-term disability insurance policy describes the method by which a disabled individual’s monthly benefit is calculation. Most often, this is a certain percentage of the employee’s “pre-disability income”. Calculating the maximum monthly benefit permitted under the plan often depends on contract interpretation, how, how much, and when the employee was compensated prior to their disability. Many professionals’ income is a combination of several variables: salary, bonuses, commissions, shares, etc. If this is the case, it is advisable to contact an ERISA long-term disability attorney who can help you determine the maximum monthly benefit you are entitled to receive under your long-term disability policy. A related issue that frequently arises with professionals who are compensated by commission is determining the proper date of disability. If your income was a combination of variable bonuses, commissions, and a fixed income, it may be helpful to contact an ERISA lawyer to help determine the maximum monthly benefit you are entitled to receive under the applicable policy.

POLICY CHANGES FROM OWN OCCUPATION TO ANY OCCUPATION:

Professionals, such as nurses, who work in a specialized field their entire career in a position that is a “light duty” job often face the hurdle of being approved for long-term disability insurance benefits when the policy language changes the definition of disability from unable to work your “own occupation” to “any occupation”. At that time, the insurance company may say that you can work in a “sedentary” clerical position. There are many provisions in the law and the long-term disability insurance policy which can limit the insurer’s ability to force you to work in a position which is inconsistent with your disability and with your background, training and experience.

For more information about The Bushorn Firm, LLC, click here.

Contact The Bushorn Firm, LLC today to speak with an attorney knowledgeable of the complications commonly arising in the context of professionals’ claims for ERISA long-term disability insurance benefits.

Beneficiary Designations Following Divorce Need Attention

Like most aspects of the Employee Retirement Security Act (ERISA) and the employee benefits world, determining who is entitled to death benefits under an Accidental Death and Dismemberment policy (AD&D), Life Insurance policy, or similar plan depends on several (often complicated) factors. Your beneficiary designations need attention following divorce in order to ensure that the intended person receives the benefits in the event of your untimely death.

• Is the policy governed by ERISA?
• Does the Policy automatically void ex-spouses as beneficiaries?
• Did the participant/employee redesignate the ex-spouse as beneficiary after the divorce?
• When did the divorce occur?
• Which state law applies?
• Does the policy have a choice of law clause?
• Does the divorce decree specify how benefits will be distributed?

Is the benefit plan governed by ERISA?

ERISA governs most employee benefits offered through private employers, including retirement and life insurance benefits. If your life insurance or retirement benefit plan is governed by ERISA, federal law will control how benefits are distributed upon your death. Under federal law benefits are generally distributed according to the applicable plan documents. ERISA also requires married employees to designate their spouse as the primary beneficiary unless the spouse provides a signed, notarized waiver.

Some employers, however, are exempt from ERISA. ERISA-exempt policies are not governed by federal law, but instead usually controlled by state law.  Many states have enacted laws that conflict with federal ERISA law. Whether the Plan is governed by ERISA or not may have a significant effect on the outcome of your benefit claim. For instance, if the employer sponsoring the benefit plan is a public university (considered a “government” plan exempt from ERISA), state law could apply. If the university is a private university, then ERISA would likely apply to the death benefit policy. The two policies could have the exact same language concerning the effect of divorce on the distribution of death benefits, but the outcomes could be opposite.

It is not always clear whether the employer is exempt from ERISA and it is important to contact an attorney who understands ERISA to make this determination if you are not sure.

What does the Policy Say?

Many policies were amended in the 1990s and 2000s to automatically void ex-spouses as beneficiaries.  The plan administrator should generally follow the terms of the plan, as long as the plan is not in violation of federal law (if ERISA governed) or state law (if ERISA-exempt).

If the ERISA governed policy is silent on the effect of divorce, the plan administrator should generally distribute the death benefits according to the applicable beneficiary designation form (unless there is an effective qualified domestic relations order, which is outside the scope of this discussion).

If, however, the policy at issue is ERISA-exempt, and does not specify the effect of divorce on the beneficiary designation, state law may still bar distribution to the ex-spouse.

State Law Concerning The Effect of Divorce On The Beneficiary Designation:

Many states have enacted laws regarding the effect of divorce on the policy’s proceeds. Ohio law states that “Unless the designation of beneficiary or the judgment or decree granting the divorce…provides otherwise…if a spouse designates the other spouse as a beneficiary…and if…the spouse who made the designation…is divorced from the other spouse…then the other spouse shall be deemed to have predeceased the spouse who made the designation…and the designation of the other spouse as a beneficiary is revoked as a result of the divorce…” Ohio Rev. Code Ann. § 1339.63.

If you believe you are entitled to death benefits, or you would like a lawyer to review your policy to ensure the appropriate person would be awarded any survivor benefits in the event of your untimely death, call The Bushorn Firm today or contact us online here. The issue of who is the correct beneficiary in the event of divorce is rarely straight forward and it is imperative that you speak with an attorney knowledgeable of ERISA and benefit claims.

DISCLAIMER

This blog is for informational purposes only. It is not legal advice. Your particular situation requires specific advice that takes into account the specific facts of your situation, your needs and other factors. The appropriate legal advice for your situation may be different from the general information provided. The Bushorn Firm cannot be responsible for your decision to use information found on the internet instead of hiring an attorney.

The legal information presented is based on Ohio law and Ohio courts. Although federal law is discussed here, the law may be applied or interpreted differently by both federal and state courts outside of Ohio. Do not assume the information presented here is true for individuals or entities in other states.