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Tenth Circuit Finds that Policy Terms in an ERISA Plan Did Not Unequivocally Grant an ERISA Administrator Discretion to Interpret Plan Terms, Applies De Novo Review

Insurance companies acting as ERISA plan administrators often are guilty of abusing their discretion to interpret policy language related to the level of benefits payable to a claimant under a long-term disability (“LTD”) policy in a manner most beneficial to them, rather than the claimant. In a recent decision by the Tenth Circuit Court of Appeals, Hodges v. Life Insurance Company of North America, 920 F.3d 669 (10th Cir. 2019), the court addressed the ability of insurance companies such as Life Insurance Company of North America (“LINA”) from interpreting policy language that may determine the level of benefits payable to a claimant.

In Hodges, the Tenth Circuit Court of Appeals affirmed the ruling of the district court that LINA failed to meet its burden to show it was entitled to deference in deciding who qualified as “Sales Personnel” and who did not under a group LTD policy issued to Endo Pharmaceuticals, Inc. The policy language did not give the Plan Administrator the authority to interpret the meaning of Sales Personnel yet LINA did so, depriving the claimant of thousands of dollars in benefits.

Lou Hodges was a cryotherapy technician for Endo Pharmaceuticals, Inc. (“Endo”) until he was forced to retire due to a degenerative eye condition in 2012. Hodges was insured under Endo’s group LTD insurance policy which was part of its ERISA Plan, administered by LINA. The Policy divided Endo’s employees into two classes: Class I employees included “all active, Full-time and part-time Employees of the Employer, excluding Sales Personnel, regularly working a minimum of 20 hours per week.” Class 2 employees included “all active, Full-time Employees of the Employer classified as Sales Personnel regularly working a minimum of 20 hours per week.”

The policy entitled all Class 1 and Class 2 employees to monthly LTD benefits of 60% of their average pre-disability earnings, but defined the earnings of Class 2 Sales Personnel far more broadly than non-Sales Personnel. The definition of earnings for all Class 2 Sales Personnel included payments “received from bonuses or target incentive compensation bonus[es].”

In evaluating Hodges’s claim for LTD benefits, although concluding he was medically eligible, LINA sought information on his job description and duties from both Hodges and his employer, Endo, to determine whether he qualified as Class 2 “Sales Personnel” for determining the level of benefits to which he was entitled. LINA informed Hodges his claim for benefits was approved but that they deemed him a Class 1 employee. This meant a much lower amount of benefits would be paid to Hodges because he would not be able to include his bonus and/or incentive compensation in LINA’s calculation of 60% of his pre-disability income.

Hodges challenged LINA’s determination, appealing twice. After the denial of his second appeal, Hodges filed suit in the United States District Court for the District of Colorado. In February 2017, the district court concluded the policy failed to reserve LINA discretion to decide employee-classification questions and remanded the case for LINA to conduct further fact finding on Hodges’s employment classification. On remand, LINA again determined that Hodges was a Class 1 employee, relying upon a statement from Endo’s Senior Vice President and Associate General Counsel.

After Hodges asked the district court to reopen the case, in June 2018 it ruled that LINA had once again failed to adequately investigate Hodges’s employment classification. Concluding that a second remand would be futile, the district court determined that Hodges was a salesperson under the ordinary meaning of that term, reversed LINA’s contrary decision, and awarded Hodges Class 2 benefits.

Upon appeal by LINA, the Tenth Circuit agreed with the district court that Hodges indeed qualified as a Class 2 Sales Personnel employee due to his responsibilities to sell and promote Endo’s commercial products and services at every available juncture; to sell doctors on performing more cryotherapy procedures; to assist in the growth and development of existing and new business lines, to market the technology and submit a minimum of one lead a month for new cryotherapy users, new applications for existing cryotherapy users, or any other lead for any of Endo’s business.

The Tenth Circuit based its decision on a lack of discretionary authority granted to LINA in construing the terms of the plan. The Tenth Circuit noted that it reviews de novo a plan administrator’s denial of benefits “unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.” Hodges, 920 F.3d at 675 citing Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). However, the court considered whether the plan granted discretion to determine whether or not benefits were payable in accordance with the terms of the policy. The court acknowledged that plans which contain clear and unambiguous discretion-conveying language afford the court the ability to grant discretion over all decisions that arise in the claims process. Here, however, the court found that nothing in the policy granted LINA the discretion to conclude who qualified as a salesperson under the plan, and noted that thirty years have passed since the Supreme Court’s holding in Firestone. Thus, plan drafters have had ample time to include language giving discretion if they so desired.

Turning to the issue of whether Hodges qualified as a salesperson, the record reflected that Hodges received a significant portion of his income from bonuses when he did sell products and services and those earnings were designated as bonuses on his pay stubs. Hodges received $3,000 for every $100,000 of pathology work that a doctor performed using Endo’s equipment and services and a monthly bonus for every case he worked on. The Tenth Circuit found that these substantial sales responsibilities and sales driven compensation would cause a reasonable person such as Hodges to believe he was a salesperson and devote his efforts to sales to increase his compensation. In addition, although he derived a majority of his compensation from performing cryotherapy services, he could not continue cryotherapy services without selling the company’s products.

The Court of Appeal’s ruling resulted in a higher level of LTD benefits payable to Hodges than he would have received had the Court determined the plan administrator had discretionary authority to interpret policy definitions regarding employee job classifications. This set an important precedent that without the clear and unambiguous authority to do so, a plan administrator does not have the discretionary authority to interpret policy language related to an employee’s job classification that would negatively affect his or her level of benefits payable under an ERISA Plan.

Hodges’s case against LINA reveals that skilled and aggressive legal representation is often necessary if you have any concerns regarding an ERISA plan administrator’s interpretation of a long-term disability policy under which you are insured and the level of disability benefits payable to you. Insurers are notorious for interpreting policy language in their favor in order to protect their own financial interests, to the detriment of ERISA claimants and in conscious disregard of their rights.

The Basics of an ERISA Life, Health and Disability Insurance Claim – Part Three: Procedural and Practical Considerations to an ERISA Claim

In this several part Blog Series entitled The Basics of an ERISA Life, Health and Disability Insurance Claim, we discuss the basics of an ERISA life, health, accidental death and dismemberment and disability claim, from navigating a claim, handling a claim denial and through preparing a case for litigation. In Part Three of this Series, we discuss procedural considerations to an ERISA claim, as well as deadlines and timeframes to carefully monitor.

When first reviewing a potential ERISA matter, it is crucial to first determine the procedural history of your client’s claim and whether there have been any denials. Most denial letters in ERISA cases set forth specific deadlines to file to an appeal. In fact, the Department of Labor regulations specifically dictate that a claimant be advised of her appeal rights.

The federal statue governing claims procedures under ERISA requires that “in accordance with regulations of the Secretary [of Labor], every employee benefit plan shall … afford a reasonable opportunity to any participant whose claim for benefits has been denied for a full and fair review by the appropriate named fiduciary of the decision denying the claim.” 29 U.S.C. § 1132(2). The regulation implementing 29 U.S.C. § 1133 states that a “reasonable opportunity for a full and fair review” is “at least 180 days following receipt of a notification of an adverse benefit determination within which to appeal…” (Emphasis added.) 29 C.F.R. § 2560.503-1(h)(3), (h)(3)(i), (h)(4). Further, in terms of calculating the 180-day deadline, courts interpreting this provision have held that if the deadline falls on a weekend, it extends to the following business day. LeGras v. AETNA Life Ins. Co., 786 F.3d 1233, 1237-38 (9th Cir. 2015).

However, if the deadline to submit an appeal has already run, this is largely accepted as being similar to missing a statute of limitations. If a claimant has missed the deadline to appeal, it is known as a failure to exhaust administrative remedies. It still may be worthwhile to ask the claim administrator to accept a late appeal or check the plan language to determine if administrative remedies be exhausted as a prerequisite to filing suit. However, if this does not work, there still may be a way to pursue litigation against the insurer or employer to get your life, medical or disability benefits paid. One way is to see if there is a recognized exception to the failure to exhaust administrative remedies doctrine. One such exception is the futility doctrine. We have discussed this previously here.

If a client has not submitted an appeal, and the deadline is quickly approaching, request an extension of time from the claims administrator. If the extension is not granted or the claims administrator does not respond in a timely fashion, the claimant should advise the administrator in writing that he is submitting an appeal of the denial, and provide as much supportive documentation as possible under the circumstances. After this initial appeal request is sent, gather the additional information, supportive medical records and documents and submit the appeal to the claims administrator. Courts typically require additional evidence of disability to be considered up until the date the appeal is denied, which will likely be after the submission of additional evidence if the appeal is sent promptly.

Some plans allow for a second appeal of a denial to be submitted. These denial deadlines are treated similarly with the first claim denials, and have similar deadlines to submit information. Remember, the appeal process allows the client to add additional supportive evidence of disability to the Administrative Record, which often includes certification letters from treating physicians, personal statements, updated medical records, updated occupational information, etc. It is necessary to have a strong Administrative Record that includes all of the critical evidence needed to support a life, medical or disability claim before commencing litigation. Therefore, it is important to enclose as much documentary support as may be needed in litigation, as courts may not allow you to supplement the record with evidence during litigation.

Sometimes, claimants may request attorney representation before a denial has been received. Nervous of the unscrupulous nature of some disability insurers, many claimants are worried that one of their main (and sometimes only) income source will be improperly ended by their insurer. Most first-party insurance policies, including life insurance, disability insurance, property insurance and liability insurance policies, require that an insured policyholder provide notice of a claim within a specified period of time, typically, “as soon as practicable,” “during the Elimination Period” or a similar formulation. See e.g. Ins. Code § 10350.7 (requirement in disability policies). For this reason, be wary of situations where your client may not have given timely notice of their claim. But, even where a policy specifies that timely notice is a condition precedent to coverage, a policyholder-friendly rule known as the “notice-prejudice” rule has been adopted by California courts to help subvert these provisions. We discussed the application of that rule here.

Next, many of the same considerations for the post-denial period apply where the claimant has not yet received the denial. The goal remains the same—obtain medical records, attending physician statements that certify your client’s disability, and submit these records to the insurer in a timely fashion. With this, the insurer will have as much information as needed to make a favorable benefit determination.

“Own Occupation” Duties in a Long-Term Disability Policy Governed by ERISA: Does a Court Favor Those Listed in the Description of One’s Actual Job, or Those Performed in the National Economy?

“Own Occupation” Duties in a Long-Term Disability Policy Governed by ERISA: Does a Court Favor Those Listed in the Description of One’s Actual Job, or Those Performed in the National Economy?

Sometimes a legal dispute comes down to the simple interpretation of the meaning of two words. The case of Christopher Patterson v. Aetna Life Insurance Company, 2019 WL 479209 (3d Cir. February 7, 2019) is such a case. There, the Third Circuit Court of Appeals upheld summary judgment in favor of the plaintiff, ruling that, as used in plaintiff’s long-term disability policy underwritten by Aetna under ERISA, the plain meaning of “own occupation” is the job duties related to one’s actual job, as opposed to some generalized “national economy” definition of the job.

Plaintiff Christopher Patterson worked for First Consulting Group, Inc., a pharmaceutical consulting firm, as “Director, Business Services.” It was through his employment that Patterson was covered by a long-term disability policy. Patterson suffered a back injury, underwent surgery, and became unable to work. Aetna began paying benefits to Patterson under the policy in 2007. In 2014, Aetna terminated Patterson’s benefits because Aetna concluded Patterson was “no longer disabled[.]”

Patterson’s disability policy defined “disability” as follows:

You will be deemed to be disabled on any day if:

You are not able to perform the material duties of your own occupation solely because of: disease or injury; and
Your work earnings are 80% or less of your adjusted predisability earnings.

The policy did not specifically define “own occupation.” Aetna determined Patterson was not disabled because he could fulfill the material duties of his “own occupation” as performed “in the national economy.” Aetna found that Patterson’s “own occupation” was “sedentary,” when defining it in the scope of the “national economy.” Per Aetna, a sedentary job would no problem for Patterson.

The Third Circuit had previously addressed the issue of the definition of a similar term to “own occupation” in a long-term disability policy. In Lasser v. Reliance Standard Life Insurance Co., 344 F.3d 381 (3d Cir. 2003), the Court looked at the term “regular occupation”, and held that “regular occupation” must involve consideration of the claimant’s actual duties as performed before the onset of disability, unless the term has been specifically defined in the policy or otherwise anticipated by the parties. Id. at 385-386. The Court rejected the insurer’s interpretation of “regular occupation” as referring to a job “in the general economy.” Id. at 385-387.

Aetna conceded that if Patterson’s definition of “own occupation” was correct, then Patterson was totally disabled. However, Aetna argued that Lasser was not controlling law because “own occupation” was the terminology, not “regular occupation.” The Court easily rejected this argument because it had previously held that the definition of “regular occupation” had to be based on the insured’s “own occupation. See Lasser; McCann v. Unum Provident, 907 F.3d 130, 148 (3d Cir. 2018).

The Court of Appeals agreed with the District Court that Aetna’s decision to terminate Patterson’s benefits was arbitrary and capricious because Aetna did not consider whether Patterson could perform his actual job duties, and even if it had done so, he could not perform those duties, as part of his material duties were traveling and standing to give presentations.

The “arbitrary and capricious” standard of review was used in this case because under ERISA, where a “benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan[,]” courts “review a denial of benefits under an ‘arbitrary and capricious’ standard.” Fleisher v. Std. Ins. Co., 679 F.3d 116, 120 (3d Circ. 2012). “An administrators’ decision is arbitrary and capricious ‘if it is without reason, unsupported by substantial evidence or erroneous as a matter of law.’” Id. at 121.

Although Aetna had discretionary authority to interpret Patterson’s policy, such interpretation may not conflict with the plain language of the plan. Id.; Lasser, 344 F.3d at 385-386; Dewitt v. Penn-Del Directory Corp., 106 F.3d 514, 520 (3d Cir. 1997). As Lasser indicates, “own occupation” is unambiguous in that in refers to a claimant’s actual job duties. Accordingly, Aetna’s interpretation of “own occupation” relating to a job’s duties in the scope of the “national economy” was erroneous. Ultimately, the Court agreed with its own prior rulings on this issue, as well as the sentiment expressed by the U.S. Court of Appeals, Sixth Circuit, that the distinction between “own occupation” and “regular occupation” is one without a legal difference. See Osborne v. Hartford Life & Accident Ins. Co., 465 F.3d 296, 300 (6^th Cir. 2006).

While the plain language of “own occupation” and the precedent set by Lasser carried the day for Patterson, the Court was also troubled by the fact that Aetna, some 12 years earlier in a different matter, argued that “own occupation” and “regular occupation” meant the same thing.

This case is a good example that unless terms are specifically defined in a contract or ERISA plan, the plain language of those terms will control. In this case, “own occupation” and “regular occupation” were merely seen as being different terminology without a legal difference. Aetna’s aggressive position in this case shows the extent to which insurers will aggressively pursue claims denials. Competent and aggressive legal representation can assist ERISA long-term disability claimants overcome claim denials in such circumstances.

Ten Things to Consider and Look For in Your ERISA Life and/or Accidental Death and Dismemberment (AD&D) Insurance Plans When You Select Benefits or File a Claim

1. Obtain a full copy of your plan. The full plan will not typically be a benefit summary or a print-out from a website. It will be fairly long and many definitions and it will recite your ERISA plan terms, policies and procedures for filing a life insurance or AD&D claim and handling the claim, claim denials, appeals of claim denials, etc. The claims administrator will likely not have a copy of the full plan. You can request a copy of the full plan from your Employer’s Human Resources department or often from the claims administrator (the insurer or third-party administrator).

2. Read the plan. Your plan document controls the rights and obligations of the parties, including all plan participants and beneficiaries. Thus, if you have an ERISA claim for life insurance benefits or AD&D benefits, you should read the plan carefully. A human resources representative, a customer service representative for the insurance company that administers your life and/or AD&D benefits, or your claims administrator may tell you what your benefits are over the telephone or in an e-mail. You cannot necessarily rely on what a representative tells you over the phone. The plan document controls the benefits available, not what someone tells you over the telephone or via e-mail. If there is any confusion, ask the representative to tell you what specific plan provision they are referencing and ask them to send you a letter documenting what they are telling you.

3. Read the definitions, provisions, and exclusions. Be aware that life and AD&D insurance policies may exclude certain types of losses, such as suicide within the first two years of life insurance coverage. Pre-existing conditions or sicknesses may exclude an insured’s death or dismemberment from coverage under an AD&D policy as well. “Dismemberment” is often defined by an AD&D policy provision. Terms like “pre-existing condition,” “sickness,” “intoxication,” and other words may have special definitions under your policy. Under an AD&D policy, you will have to prove that the claimed loss resulted from an accident or accidental bodily injury. This can be complicated, especially where the accidental bodily injury may have been caused in part by a preexisting medical condition. If this is the case, you will need to consult an attorney immediately as there are complex and technical rules that are only found in applicable case law. McKennon Law Group PC is highly experienced in this area. Make sure you know what is required under your plan’s specific definitions in order to successfully claim life and/or AD&D benefits.

4. Select the appropriate coverage amount. Some employers will provide you with a base amount of life or accidental death and dismemberment (AD&D) insurance coverage, and some may not. Be sure to select the level of coverage that you want, and make sure you fill out any forms, like a Statement of Health, to ensure that you receive the coverage you select. You may also be able to select a level of life or AD&D insurance coverage for your spouse as well. Read the plan and policy documents carefully; your policy may state that, if selected, your spouse coverage will only be a percentage of your coverage, but your policy may also provide for spouse coverage in an amount independent of your coverage.

5. Confirm your coverage. Get a confirmation of coverage in writing, either a print-out of the premiums that you are paying for each insurance coverage you have chosen through your employer or a certificate that states the exact coverage you receive. Make sure you always have a current document showing your benefits coverage, which will usually be once a year after coverage selection or two to four months after you begin new employment. Review your premiums statements to ensure that you are paying the correct amounts for the coverages that you selected. Put all communications with your employer or insurer in writing and insist on the same in return.

6. Understand the conversion period to individual coverage. Many insurance companies permit you to continue your life and AD&D insurance coverage with them if you leave your employer. Usually, you need to contact the insurance company for your life and AD&D benefits within 30 days of your last day of work to convert your policy. Read through your plan documents and policy to understand the time period you must convert your group policy to an individual one and to know who you need to call or write to in order to continue your insurance coverage through an individual policy. If you decide to convert your policy, keep detailed records on when you called or wrote to the insurance company, what number you called, and who you spoke to regarding conversion of your policy or policies. You may be limited to a 30- or 31-day period, so make sure you follow up every couple of days until you receive confirmation that your policy has been converted. However, by law, if the insurance company does not convert your policy in a timely manner despite your requests to do so, you may be able to extend the time period in which you may convert your policy. You should contact an attorney for advice if you encounter this problem.

7. Time to appeal a claims decision. Read the appeals or grievance section to determine your appeal rights and deadlines. The first appeal must be submitted within 60 days of the date you receive the initial denial, pursuant to ERISA’s regulations. However, there may be a second appeal, which may be mandatory or voluntary. Whether there is a second appeal and whether it is mandatory or voluntary is critical to pursuing your life and/or AD&D benefits claim in court if it is denied. Additionally, although ERISA requires that you have 60 days to file your first appeal, the insurance company may dictate that a second appeal be filed in shorter amount of time. Be aware that you can and should contact an attorney as soon as you receive any notice, oral or written, from your insurance company that your claim will be or has been denied. An attorney can help you with your first and second appeals of the denial of your life and/or AD&D benefits, which will also help if you need to go to court to force the insurance company to pay you your benefits because the attorney will ensure that your life and/or AD&D claim record during the administrative appeals is complete and will help a judge understand that the insured’s death or dismemberment qualifies for payment of benefits.

8. Obtain a full copy of the claim file or administrative record. If your claim for benefits has been denied once, make sure you obtain a full copy of the claim file and/or Administrative Record so you can see what the insurance company considered in denying your claim. You can request a copy of the administrative record from the claims administrator, which is often an insurance company such as MetLife, Unum, and Liberty Mutual. If your claim for benefits has been denied after one (or two) appeals, make sure you obtain another copy of the claim file, which is also called the “administrative record” in insurance litigation, because it will contain updated records of what the insurance company considered in denying your appeal(s).

9. Find the statute of limitations and contractual limitations period as stated in your plan. The statute of limitations and contractual limitations period will be the period of time by which you must file a lawsuit to obtain disputed benefits. To file a lawsuit for benefits pursuant to an ERISA plan, you must first submit appeals (at least one, but no more than two). The contractual limitations period may appear in a section titled, “Legal Action.”

10. Find out who the plan administrator is and seek necessary information from it. Look for a name and address of the plan administrator in the plan. If your claim has been denied, send a written request to the plan administrator for all plan documents. The plan administrator is required to provide the plan documents to you within 30 days. 29 U.S.C. § 1024. Federal regulations allow you to file a lawsuit to seek penalties from the plan administrator in the amount of $110 per day for each day the plan documents are not provided beyond the 30-day period. 20 U.S.C. § 1132(c)(3); 29 C.F.R. § 2575.502c-1.

If your ERISA claim has been denied, knowing when to sue may be integral to the success of your claim. It is important to have experienced and highly qualified disability, health, life and accidental death or dismemberment insurance attorneys, like those at the McKennon Law Group PC. Fill out our free consultation form today to set a time to discuss your claim with one of our attorneys, several of whom previously represented insurance companies and are exceptionally experienced in handling ERISA and Non-ERISA insurance claims.

Ten Things to Consider and Look For in Your ERISA Short-Term and Long-Term Disability Plans When Selecting Benefits or You Want to File a Claim

1. Obtain a full copy of your plan and administrative record. The full plan will not typically be a benefit summary or a print-out from a website. It will be fairly long and many definitions and it will recite your ERISA plan terms, policies and procedures for filing a claim and handling the claim, claim denials, appeals of claim denials, etc. The claims administrator will likely not have a copy of the full plan. You can request a copy of the full plan from your Employer’s Human Resources department or often from the claims administrator (the insurer or third-party administrator). You can request a copy of the administrative record from the claims administrator, which is often an insurance company such as MetLife, Unum, and Liberty Mutual.

2. Read the Plan. Your Plan document controls the rights and obligations of the parties, including all plan participants and beneficiaries. Thus, if you have an ERISA claim for Short-Term and Long-Term Disability benefits, you should read the plan carefully. A human resources representative, a customer service representative for the insurance company that administers your disability benefits, or your claims administrator may tell you what your benefits are over the telephone or in an e-mail. You cannot rely on what a representative tells you over the phone. The Plan document controls the benefits available, not what someone tells you over the telephone or via e-mail. If there is any confusion, ask the representative to tell you what specific Plan provision they are referencing and ask them to send you a letter documenting what they are telling you.

3. Understand the difference and transition between Short-Term Disability (STD) and Long-Term Disability (LTD). Be aware that getting STD insurance does not automatically mean that you have LTD insurance. If you want to ensure financial stability if you suffer a long-term disability in the future, you will want to ensure that you select the appropriate amount of LTD coverage because STD benefits will only last you about three to six months. LTD coverage will often last until your 65th birthday. Additionally, some plans provide for an automatic transition between STD and LTD benefits, but others have a gap of time between STD and LTD benefits or require two, separate applications for the STD and then the LTD benefits.

4. Select the appropriate coverage amount. Employers often provide an automatic base STD amount and allow you to opt into higher coverage for STD. LTD insurance coverage is often optional and offers several coverage levels for the amount of benefits you would like to receive if you become disabled. Be sure to select the coverage that you want, and make sure you fill out any forms, like a Statement of Health, to ensure that you receive the coverage you select.

6. Time to appeal a claims decision. Read the appeals or grievance section to determine your appeal rights and deadlines. The first appeal must be submitted within 180 days of the date you receive the initial denial, pursuant to ERISA. However, there may be a second appeal, which is sometimes mandatory and sometimes voluntary. Whether there is a second appeal and whether it is mandatory or voluntary is critical to pursuing your disability claim in court if it is denied. Additionally, although ERISA requires that you have 180 days to file your first appeal, you may have only 30 or 60 days to file your second appeal. Be aware that you can and should contact an attorney as soon as you receive any notice, oral or written, from your insurance company that your claim will be or has been denied. An attorney can help you with your first and second appeals of the denial of your STD and/or LTD benefits, which will also help if you need to go to court to force the insurance company to pay you your benefits because the attorney will ensure that your disability claim record during the administrative appeals is complete and will help a judge understand that you are disabled.

7. Read the definitions. Terms like “disability,” “your occupation,” “physician’s care,” and other words may have special definitions under your policy. Make sure you know what is required under your plan’s specific definitions in order to successfully claim disability benefits. You should also look for the “Elimination Period” in your STD and LTD plans. The Elimination Period is the time period you are unable to receive benefits under that plan, a type of “waiting period.” For STD benefits, it is often no more than a week. For LTD benefits, it is often the duration for which STD benefits are paid, so the LTD Elimination Period generally lasts approximately three to six months from the date of your disability.

8. Statute of Limitations and Contractual Limitations Period. These will be the period of time by which you must file a lawsuit to obtain disputed benefits. To file a lawsuit for benefits pursuant to an ERISA plan, you must first submit appeals (at least one, but no more than two). The contractual limitations period may appear in a section titled, “Legal Action.”

9. Who is the Plan Administrator? Look for a name and address of the Plan Administrator in the Plan. If your claim has been denied, send a written request to the Plan Administrator for all plan documents. The Plan Administrator is required to provide the plan documents to you within 30 days. 29 U.S.C. § 1024. Federal regulations allow you to file a lawsuit to seek penalties from the Plan Administrator in the amount of $110 per day for each day the plan documents are not provided beyond the 30-day period. 20 U.S.C. § 1132(c)(3); 29 C.F.R. § 2575.502c-1.

10. Calculate your STD and LTD weekly or monthly benefits. STD and LTD benefits may be paid as a percentage (e.g., 50%, 60%, 70%) or multiplier amount (e.g., 1x, 2x, 3x) of your regular earnings. Your STD and LTD benefits amount may be different depending on what level of coverage you chose in your most recent benefits selection. For example, you may receive only 50% of your base earnings in STD benefits but 65% of your base earnings as LTD benefits. Additionally, almost all STD and LTD policies will “offset” your benefits with any other disability-related income you may receive, including SSDI, SSI, and state disability insurance income. If you apply for LTD benefits, many policies will require that you apply for SSDI, which is disability insurance offered by the federal government. If and when you are approved for SSDI, that amount will be subtracted from your future benefits payments of your LTD benefits.

If your ERISA claim has been denied, knowing when to sue may be integral to the success of your claim. It is important to have experienced and highly qualified disability, health and life insurance attorneys, like those at the McKennon Law Group PC. Fill out our free consultation form today to set a time to discuss your claim with one of our attorneys, several of whom previously represented insurance companies and are exceptionally experienced in handling ERISA and Non-ERISA insurance claims.

Robert J. McKennon Recognized as 2019 “Super Lawyer – Insurance Coverage”

McKennon Law Group PC is proud to announce that its founding shareholder Robert J. McKennon has been recognized as one of Southern California’s “Super Lawyers” and appears in the 2019 edition of Southern California Super Lawyers magazine published in January 2019. Mr. McKennon has received this prestigious designation every year since 2011. Mr. McKennon was voted by his peers for this award and he was recognized for his excellence in representing his clients as an insurance claims denial attorney, especially with respect to his work representing life, health and disability policyholder clients. Each year, Super Lawyers magazine, which is published in all 50 states and reaches more than 14 million readers, names attorneys in each state who attain a high degree of peer recognition and professional achievement. The Super Lawyer designation is given to less than 5% of lawyers nationally after being nominated and voted on by their peers.

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