ERISA Disability Claims

Disability Insurance: What ERISA Remedies Are Available?

Published on March 17, 2014 by

ERISA insurance plan recipients who have been following me for any length of time probably know that they don’t have as many options available to them in regards to suing their insurers. You can’t punish them for acting in bad faith. You can’t get damages. You can’t sue for pain and suffering.

In fact, the only thing that you can really expect if you win your appeal is to get the benefits you should have gotten in the first place and (if you’re lucky) have the insurer pay your legal costs. Still, there are several different codes defining the “remedies” that are available to you, and if you’re considering filing an appeal it’s important that you understand them ahead of time.

The Four Codes Defining ERISA Remedies

  1. 1.      29 U.S.C. 1132(a)(1)(B)
    1. You have the ability to recover any benefits that are owed to you as defined under the terms of your policy
    2. You can enforce any rights that are given by the policy
    3. You can clarify what your rights are to future benefits under the policy
    4. 2.      29 U.S.C. 1132(a)(2) – This code acts as a remedy against a plan’s fiduciary for breach of duty
    5. 3.      29 U.S.C. 1132(a)(3)
      1. You have the ability “to enjoin any act or practice” that goes against either the terms of the policy or any provision in Title I of ERISA
      2. You have the ability to get “other…equitable relief” by:

i.     Redressing plan violations

ii.     Enforcing Title I of ERISA or any policy terms

  1. 4.      29 U.S.C. 1140 – You have the ability to bring a suit against anyone who blocks the rights that you have been granted under ERISA or the terms of the policy.

What the Four Codes Really Mean

All of that sounds really nice, but in many ways it’s just stating the same thing four different ways. Why do I say that? Because the result for you is always the same if you win – all you can get are the benefits you should have already gotten and money to cover your legal costs.

Still, it’s valuable to know so that your attorney can attack and reference the appropriate codes when filing the lawsuit and preparing your strategy. In these kinds of cases, language and procedure matter, so you absolutely need someone on your side who’s been there before.

Whatever you do, make sure you work with a disability expert you trust who knows this area of the law. Don’t play games with your health. Check out our free e-book for more details about ERISA disability and be sure to stay up to date on new long term disability information through our weekly blogs!

 

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How Does Your ERISA Plan Work?

Published on March 3, 2014 by

If you’re having trouble with your employer-sponsored health plan for a long term disability issue, you’re not alone. Lots of Americans have their claims denied or receive confusing answers from their insurers, and because they don’t really understand how a health plan covered under ERISA law works, they often don’t know what to do to fix the problem.

That’s why I decided to break down the basics of how most plans under ERISA are set up. It’s not going to make you an expert, and you definitely still want to work with an attorney if you need to file a lawsuit against your insurer, but hopefully it will at least make some things clearer.

The Basic Setup for Plans Covered By ERISA

The first and most important thing to know is that if you get insurance from an employer, you most likely have a plan covered under ERISA law. After that, you have to understand that you’re probably going to need to lower your expectations for what you’ll get if you file a lawsuit. Unlike with independent plans, people covered by ERISA can’t sue for punitive damages, bad faith, emotional distress, unfair practices, and many other things that seem like they should be allowed.

How does ERISA insurance work?

There’s a plan. This includes the policy and a “core set of defining documents,” as well as any amendments.

There’s an administrator. Basically, the administrators are the ones who decide if coverage for someone is accepted or denied. Insurers like to be the ones with this power and most of the time it’s given to them.

You have to go through internal review. If your claim is denied and you disagree, you are required to have the denial reviewed internally (i.e. by the insurer) and “exhaust” your administrative options with them before filing a lawsuit. This can be quite time-consuming.

You will get a benefits denial notice. ERISA regulations require insurers to send you a denial notice that explains why you were denied and what options you have to appeal the decision within a timely manner.

If your insurer meets all of the standard requirements, it is vital that you act fast to appeal. Because of this and the specific rules that have to be followed, you want to work with a lawyer experienced in ERISA cases.

Check out our free e-book for more information on ERISA claims and be sure to check back weekly for even more long term disability claim blogs!

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Long Term Disability: Protections ERISA Plans Don’t Have

Published on February 26, 2014 by


Supposedly, ERISA was enacted in 1974 to protect people who get their health insurance through employer-provided plans, but anyone who has spent time working on these types of long term disability cases knows that the reality is less about protecting you and more about keeping insurers from losing money.

I’ve talked about this problem before here, but today I wanted to lay out exactly what you’re losing when you have a plan covered by ERISA laws.

ERISA Offers No State Protections

You might have heard this before, but do you really know what it means? Depending on the state you live in, there are a wide variety of things that you can do to keep your insurer honest and fight back against illegal practices designed to keep you from getting the benefits you deserve. These may include suing for:

  • Emotional distress
  • Consequential (or special) damages
  • Prejudgment interest for breach of contract
  • Tortious interference with contract
  • Deceptive trade acts or unfair practices
  • Bad faith
  • Punitive damages

But those under ERISA plans aren’t eligible for any of this – you won’t even be able to go to a state court. Instead, you will be sent to a federal courtroom and the best outcome you can hope to receive is that the judge will make your insurer honor the policy by providing you with benefits you should have gotten in the first place--and hopefully pay your attorney fees.

Doesn’t sound fair, does it? Unfortunately, it’s the law that we have to live under until enough people push for change in long term disability and insurance in general. The Affordable Care Act doesn’t do enough – if you want to make ERISA work for you, contact your congressional representative and fight to make things better.

Check out our free e-book for more details about ERISA disability and be sure to stay up to date on new long term disability information through our weekly blogs!

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Non-ERISA Plans – Where Are They?

Published on February 21, 2014 by

When Congress created the Employment Retirement Income Security Act in 1974 (ERISA), the stated intention was to “protect…participants in employee benefit plans and their beneficiaries…by establishing standards of conduct…and by providing for appropriate remedies.” Basically, the law was supposed to make things better for people in big group health plans by demanding that they all follow the same federal rules.

While they certainly knew that ERISA regulations would cover a lot of people, they still meant for there to be plenty of non-ERISA plans. Unfortunately, the people who actually wrote the language of the law made it so vague that today practically everyone getting insurance through their employer is governed by ERISA – and the vast majority of people in our country are insured through their work. Though plans that aren’t covered by ERISA do exist, they are incredibly few and far between.

What Kinds of Plans Aren’t Covered By ERISA Law?

Anyone who has had to file a claim on a plan governed by ERISA knows that the rules “protecting” them are weak at best. If your insurer denies your claim and you have to fight back, you won’t be able to go to state courts and you won’t have any of the protections provided by state laws – ERISA is your only “help.”

So, who’s lucky enough to have a plan not covered by ERISA? People with individual insurance plans, anyone on federal or state plans like Medicare and Medicaid or, those insured through exempt organizations like churches. And that’s it.

As of January 1, 2003, after new regulations were passed, there were around 130 million Americans covered by the weaker laws of ERISA simply because they got their insurance from their job. Subtract the millions of uninsured Americans and you can easily see that the vast majority of people in our country are not only being denied protections they deserve, but also covered by rules they don’t understand. If you have to file an ERISA lawsuit, make sure you work with an attorney well-versed in the regulations.

For more info on ERISA and Non-ERISA based disability claims, check out our free e-book and be sure to check back weekly for more blogs!

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