What RBG Has To Say About ERISA Federal Insurance Law

| Frank R. Kearney

ERISA Was Intended To Protect The Cash In Employees’ Pension Funds

ERISA is an acronym for the “Employee Retirement Income Security Act.” ​Employer-offered disability insurance plans are governed by ERISA and the original intent behind the law was good, though its application is problematic.

ERISA was intended to protect the cash in employees’ pension funds. A pension is a type of employer-offered retirement plan that pays out in the form of monthly income after retirement. The most likely types of employees to have pension plans are public servants like police officers, firefighters, and the like. Though it should probably be demarcated in separate legislation, the ERISA law also covers the administration guidelines for employer-offered long-term disability plans. Long-term disability plans and pensions are connected in theory, and in legislation, as they both payout in monthly installments of income replacement.

After The Implementation Of ERISA In 1974, The Insurance Companies Gained Shocking Advantages

In understanding how this plays out you first need to understand how an employer-offered disability plan differs from an individual policy. First, an ERISA plan is most often covered by your employer – and you may also pay a part of the plan with payroll deductions. An independent or individual plan is something you procure on your own and pay the premiums directly without the involvement of your employer.

The intricacies of insurance law often necessitate the assistance of an attorney even at the outset, before you file a claim. You may never know that your insurance policy has certain exclusions, or clauses, that are going to trip you up in the event you ever need to actually use the policy. That’s why we offer reviews of policies at a deeply discounted rate and will credit that review toward your claim enforcement should you ever need it.

If you have an individual disability insurance policy, you can sue directly for damages (this is much different under ERISA). Insurance companies are less likely to arbitrarily and capriciously deny your claim if there is a provision that they can get sued directly in order to enforce what they are supposed to be doing in the first place. These types of lawsuits fall under the auspices of “specific performance” – if you contracted with a company to do something, and they fail to do it, you can take them to court.

This will discourage individual insurance companies from wrongfully denying claims because they know they risk a significant financial punishment – especially since in lawsuits you can tack on additional damages. You are also entitled to a jury in this type of lawsuit (rather than just a judge) which creates better odds in your favor.

In an individual policy (but NOT in an ERISA policy) you also have the opportunity to present your case in full and have your doctors testify on your behalf. Most lawsuits have provisions for “discovery” which in this case would allow your attorney to request and receive full disclosure as to how many hundreds of thousands of dollars the “independent” medical examiners are paid by the insurance company. Discovery would also likely net you and your attorney other helpful disclosures that reveal the agenda of the insurance company – in most cases protecting their bottom line.

Additionally, ERISA escapes the state regulations that keep most insurance companies in check because it is a federal law and not subject to state regulations (the Supremacy Clause at its best). ERISA precludes any sort of helpful regulation of employer-offered disability insurance plans.

Even One Of The Most Well-Known Justices Had An Opinion About ERISA

Justice Ruth Bader Ginsburg said that she joined;

“the rising judicial chorus urging Congress and the Supreme Court to revisit what is an unjust and increasingly tangled ERISA regime.” The problem, she says, is that through its decisions, the Court has made it so that virtually all state law remedies which would provide just relief are preempted, but very few federal substitutes are provided. She pointed out that a “series of the Court’s decisions have yielded a host of situations in which persons adversely affected by ERISA-proscribed wrongdoing cannot gain … relief” and that the current situation needs to be remedied “quickly” because it is “untenable.”

Why do we tell you all of this? We don’t want you to get caught in a trap of thinking you’ll be covered with income replacement in the event of a tragic accident or serious illness that will prevent you from working. You could very well file a claim and win your case, but you are going to need an attorney to help you with it if you want to give yourself a fighting chance. And you’ll need to know the key mistakes that most people make when they are filing a claim with their employer-provided, long-term disability carrier (Aflac, Guardian, Unum, Prudential, Metlife, The Hartford, MassMutual, etc).

Speak To An Experienced Long-Term Disability Attorney Today – Just Call 202-393-3320

If you simply have a long-term disability policy and you’d like to have it reviewed, we will do that for you at a deep discount, the payment of which will be credited toward drafting your claim if you should ever need to do that. If you are already at the “claim submitted and denied,” stage, you simply cannot afford to do this without a lawyer. We will review your denial letter for free if you send it to us (email, fax, carrier pigeon, drop-off) and see if we can help you. Reach out to us today at 202-393-3320.

Why ERISA Long-Term Disability Cases Are Unfair From the Get-Go

When you start a race, would you rather have a head start or have your starting line placed behind everyone else, further from the finish line? ERISA Long Term Disability cases can be considered a race themselves in the fact that sometimes the winner is decided even before the starter says “go”.

How is this possible?

If you’ve navigated our web page, you’ll know that judges and courts reach a judgment based on whether or not an insurer or carrier acted reasonably in evaluating and deciding a person’s claim. In other words, the judge does not care whether or not the policy itself is a good one or bad one, whether your medical condition or injury prevents you from working, or whether you have additional information and evidence you want to develop and submit. The decision is based on whether the insurance company had a reasonable basis for denying your claim. That’s it.

Many ERISA policies are written with the intention of “stacking the deck” to favor the insurance company instead of the person covered under the policy. Therefore, if you’re covered under the policy your employer purchased, chances are you are going to be fighting an uphill battle if you ever develop a disability and need to file a claim. For instance, if a policy reads that the insurance company has “the discretion to determine benefits,” it means the company basically gets to decide on its own what you are entitled to.

For example, in December of 2018, the federal court here in D.C. decided on a case titled Arabaitzis v. Unum Life Insurance Company. To provide some context, Elaine Arabaitzis—the plaintiff, the person with the disability —was an employee of a local law firm. She claimed to have “suffered from pain, discomfort, fatigue, and other related impairments caused by cervical and spinal injuries, carpal tunnel syndrome, [along with] other conditions and impairments.”

The claim was denied by the disability insurance company, and she appealed that decision (these appeals go to the insurance company and to be successful, have to be a lot more involved than just submitting a form). In fact, any federal lawsuit you file will be decided based on what was provided to the insurance company during the appeal so it’s critical to do this the right way. It was denied again, so her remaining option was to file a lawsuit in federal court (since ERISA is a federal law).

Unfortunately, the magistrate judge found the insurance company’s decision was reasonable. Ms. Arabaitzis had 14 days to object to those findings but missed the deadline due to a math error…her Motion to Reconsider was denied and the federal judge who presided over the case added in his Memorandum and Order that “even though the mathematical error was small…’ close’ counts with horseshoes and hand grenades, not filing deadlines.”

It’s a harsh illustration but a good warning if you have received a letter from your disability insurance company denying or terminating your benefits – the deadlines in these cases count. Because of the way these insurance policies are written, you have to do everything you can to put your case in the best position to win, and that starts after you get that letter.

If you’re considering filing for long-term disability, have received a letter denying or ending your benefits, or want to discuss your policy, call us today at 202-393-3320 and hopefully, we can keep you from making the mistakes so many people with legitimate, serious, disabling medical conditions, make in these cases.

What is ERISA Long-Term Disability Insurance?

If you are like most people and your company offers long-term disability insurance and you need to make a claim for benefits because you can’t work due to ERISA Long Term Disability Insurance Claims in DCto a serious injury or medical condition, your case falls under a federal law called ERISA (The Employee Retirement Income Security Act of 1974).

Congress originally passed this law in 1974 to protect pension funds, but like so many other things Congress does, it has expanded to cover other employee benefits, and one of those is long-term disability benefits. Unfortunately, over time, courts have interpreted it and it has been used to protect insurance companies more than the employees seeking benefits.

Almost all disability insurance plans offered to employees in the private sector are governed by ERISA. Under ERISA, you have the right to file suit in federal court against the insurance company if your claim for benefits or appeal is denied. But it won’t be like other court cases (and most lawyers don’t even know this). You see, the case is decided based on the insurance policy and the administrative record – including the appeal and all of the evidence you submitted to the insurance company. There is usually no discovery, depositions or testimony. A federal judge decides the case, not a jury.

How Do Appeals Work in Long-Term Disability Cases?

OK, so if you really follow our advice on how to research, formulate, draft and file your appeal based on the insurance company claim file, the disability policy definitions, and a few other things, you should be good to go

Not so fast. There is another advantage the disability insurance company has – a “reservation of discretion” clause. It’s not in the statute, instead, the courts created it – and it’s a big help to long-term disability insurance companies denying legitimate claims for people who can’t work.

Basically, how the clause works are If your claim for benefits is denied, you still lose even if you can prove you were right in the first place, as long as there is some evidence that supports the insurance company’s decision.

In any other civil court proceeding – medical malpractice or any other case for damages from injuries, you win if a jury believes you proved your case by a preponderance of the evidence, which just means what you are claiming is more likely than not, or greater than 50%. But in long-term disability cases covered by ERISA, you can have almost all of the evidence supporting your claim for benefits – 80 or 90%, but as long as the insurance company has something, they can still win under that awful clause

So your appeal is absolutely critical.

Contact our Experienced Long-Term Disability Lawyers Today

If your claim has been denied and you need to file an appeal, or if you’re considering filing for long-term disability benefits due to a serious injury or medical condition, call us today to talk it through 202-393-3320. The call is free and confidential of course.

This short video will show you a few of the things you have to know, watch out for or deal with. After reading it, if you want more information or need a lawyer to discuss your specific situation with, call us at (202) 393 3320. But don’t wait. If your condition is getting worse, you may not have a lot of time before you need to file a claim. And if you received a denial letter from the insurance company, you may have only 180 days to file your appeal. That’s not a lot of time for the amount of work you may need to do.

by Frank R. Kearney, Attorney-at-Law

Experienced DC Workers’ Comp, Long Term Disability & Accident Lawyer,

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    Mr. Kearney and Mr. Donahoe were excellent attorneys. They were very caring toward my son and myself. They always explained everything in detail and kept in touch with us, updating us about the case. Whenever we would call or needed a question answered, Mr. Kearney or his assistant was always there to help. My son and I are very happy and satisfied with the outcome of the case. Mr. Kearney and Mr. Donahoe were the best and I would highly recommend them to other people.

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