Why Was My ERISA Benefits Claim Denied?
Because it is such a complex area of law, there are many reasons why Long-Term Disability (LTD) ERISA claims are denied. While our office has seen a whole host of attempted denial justifications, listed below are some of the most common reasons for denial – and how to avoid them when submitting your own claim.
1. Enrollment Period
Most plans will specify how long a person needs to be employed before their benefits kick in (for example, 90 day is often the norm). Check your plan’s details to ensure that you have fulfilled the enrollment period.
- How to Avoid It: Consult the details of your plan to ensure that you have fulfilled the necessary enrollment period prior to totally ceasing work and applying for coverage.
2. “Active At Work” Requirement
This is a VERY important requirement. Most plans require that you be active at work a certain number of hours per week before you claimed a disability. Often times, an employee will reduce their number of work hours per week, and do not make a benefits claim during this time. If the person does not recover from the illness or disability, and decides to make a claim after he/she has already reduced their work hours, this may be the reason for their claim denial – they did not meet the “active at work” requirement. Similarly, the amount of benefit you may collect is often based on the last 3 months of salary you earned prior to ceasing work.
- How to Avoid It: Stay informed about your plan. Know how many hours are needed to fulfill the “active at work” requirement. Do not reduce your weekly work hours below this number before you submit your claim!
3. Do Not Meet the Policy’s Definition of “Disability”
This is the most common basis for denial, as the LTD carrier will often rely on their hired doctors who simply review the claimant’s records without actually examining them (often called QME’s). These type of denials are routine ways the carriers attempt to try and save money by denying coverage.
Typically, the determination of whether a person’s injury, illness, and/or sickness meet the definition of “disability” is two-fold:
- Is there objective evidence to support the person’s claim?
- Is the disability related to performing the claimant’s job or occupational field?
The first question is often incredibly frustrating for a disabled claimant. If a disability is difficult to determine objectively (with blood work, x-rays, etc.), insurance companies are quick to conclude that it does not qualify as a disability. Sometimes debilitating and painful conditions, such as fibromyalgia, are difficult to diagnose objectively, as the diagnosis often based on the patient’s subjective complaints. American courts are divided on whether policy’s can specifically require objective medical evidence for a disability. Either way, it is one of the first things that insurance company’s research when deciding a claim.
Whether the disability relates to the claimant’s job (or own occupation) is also a gray area. A plan’s administrator will look at how a particular job is performed on a national scale, rather than the detailed, personalized job specifications the claimant must meet. An insurance company may recognize that a claimant’s specific job has requirements that are stringent and stressful, but the overall occupation standing on its own does not have such requirements. In this case, the insurance company will deny the claim based on the fact that the claimant is not prohibited from working as compared to similar workers on a national scale. It is important to give as many details as possible concerning your job qualifications, duties, hazards, etc. If a claimant does not provide these, an insurance company may use a broad, inaccurate, or minimized job description to determine if the disability is related to your specific job, rather than the field of your occupation.
As you can see, these are only a few of the many ways that a LTD carrier may be able to deny an otherwise valid disability claim. Whether or not your claim was denied based on one the above examples, speaking with an experienced LTD attorney to gain info on your rights can make a huge difference. Many lawyers do not charge a consultation fee, but will need to have a copy of paperwork from your LTD carrier for their review.
Still have questions or concerns regarding your personal claim? Bonnici Law Group has been helping San Diegans fight disability denials for years. Let him help you too.