Aligning ERISA Disability Claims Procedures with Affordable Care Act

Is your long term disability insurance policy part of your employee benefits? If so, you should know that plan years beginning on and after January 1, 2018 are now subject to regulations that apply to both short term and long term disability policies. These regulations may improve how claimants are treated through the disability claims process. The overall goal is to track enhanced disclosure and claims procedures similar to those put into place for the Affordable Care Act. We are skeptical, but hopeful. Here are some of the highlights.

Benefit denial notices must provide more information. We’ve been fighting the obscure nature of denials for decades, so this would be a welcome change. If the denial includes an opinion that differs from that of the treating medical professional or vocational experts, a clear explanation must be provided. Explanation of any information used to deny the claim must be produced. Better: claimants must receive timely notice of their right to receive copies of documents concerning their disability claim determination.

Any new evidence or new reasons for the response to an appeal must be provided and, even better: the claims administrative must disclose this information and afford the claimant the opportunity to respond to such new evidence developed by the insurer.  This does not mean that there are no time limitations; those are still in place and missing a deadline could still cause the entire appeal to be dismissed, but this at least provides the start of a reason for cases arguing about the timely nature of the notice.

Plan administrators are tasked with impartiality. The regulations emphasize independence, and decisions about an employee or retaining medical or vocational experts are not to be made based on an expectation of whether or not a claims adjuster will deny a disability claim.

The proposed disability regulations have requested comments on whether current limitations on time limits for lawsuits to be brought should be permitted. We will be following this discussion closely, as it could have a significant impact on our clients.

This is a brief and by no means exhaustive summary of how these regulations will be applied to short and long term disability insurance claims under ERISA. If you are considering bringing a claim but have questions, you are invited to call us at 877-LTD-CLAIM (877-583-2524) to learn how we can help. Remember that there strict limitations still in place, so don’t wait to call.

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