ERISA’S ARBITRARY AND CAPRICIOUS STANDARD OF REVIEW IS NOT A RUBBER-STAMP

Under ERISA, if a court determines that a plan contains a proper grant of discretion to the decision-maker, then it reviews the decision under an arbitrary and capricious standard of review. However, while the arbitrary and capricious standard is deferential, “it is not, however, without some teeth.” McDonald v. Western-Southern Life Ins. Co., 347 F.3d 161, 172 (6th Cir. 2003). Continue reading “ERISA’S ARBITRARY AND CAPRICIOUS STANDARD OF REVIEW IS NOT A RUBBER-STAMP”

DISABILITY DEFINED AS THE INABILITY TO BE A RELIABLE EMPLOYEE BECAUSE OF A MEDICAL CONDITION

Most people think about “disability” as defining a state of affairs where an individual cannot provide an income for him or herself; that is, he or she cannot work. Indeed, in most instances, disability does mean an individual is unable to work although in the context of ERISA disability claims there are policies which pay benefits when an individual cannot perform his or her “own occupation” and others which pay benefits for “partial disability.” However, it is best to over-simplify the issue and concede that, Continue reading “DISABILITY DEFINED AS THE INABILITY TO BE A RELIABLE EMPLOYEE BECAUSE OF A MEDICAL CONDITION”

THE IMPORTANCE OF A FAVORABLE SOCIAL SECURITY DISABILITY DECISION IN LONG-TERM DISABILITY LITIGATION

As you might expect, many individuals who have long-term disability (“LTD”) ERISA claims also have claims for Social Security Disability benefits. Indeed, many insurance companies require LTD claimants to file for Social Security disability. This is done because most plans offset the LTD benefit by the Social Security disability benefit and this reduction is considered by the insurers to be one of the most important cost containment features of their LTD contracts (and is usually termed “recovery of an overpayment”).

Continue reading “THE IMPORTANCE OF A FAVORABLE SOCIAL SECURITY DISABILITY DECISION IN LONG-TERM DISABILITY LITIGATION”

UNDER CERTAIN CIRCUMSTANCES, EXHAUSTION OF ADMINISTRATIVE REMEDIES IS NOT REQUIRED IN A LONG-TERM DISABILITY ERISA MATTER

Ordinarily, a long-term disability claimant must exhaust his or her internal review before bringing a claim for judicial review under § 502(a)(1)(B). In other words, a claimant typically has to complete the appeal process as described by the long term disability policy and/or plan. However, the Sixth Circuit has “repeatedly held that exhaustion may be excused if the claimant establishes futility.f Welsh v. Wachovia Corp., 191 F. App’x 345, 356 (6th Cir. 2006) (citing, e.g., Hill v. Blue Cross & Blue Shield of Mich., Continue reading “UNDER CERTAIN CIRCUMSTANCES, EXHAUSTION OF ADMINISTRATIVE REMEDIES IS NOT REQUIRED IN A LONG-TERM DISABILITY ERISA MATTER”

UNDER ERISA AN INSURANCE COMPANY’S FIDUCIARY DUTIES INCLUDE DISCLOSING MATERIAL INFORMATION TO ITS CLAIMANTS, WHETHER REGARDING LONG-TERM DISABILITY OR HEALTH BENEFITS

As explored in the blog last week, an insurance company, typically the party obligated to pay benefits and the administrator given discretion in construing and applying the provisions of a group health or disability plan and assessing a participant’s entitlement to benefits, is an ERISA fiduciary. However, an insurance company’s duties as an ERISA fiduciary are not confined to reviewing and gathering evidence under a duty of loyalty to its long-term disability or health insurance claimant, Continue reading “UNDER ERISA AN INSURANCE COMPANY’S FIDUCIARY DUTIES INCLUDE DISCLOSING MATERIAL INFORMATION TO ITS CLAIMANTS, WHETHER REGARDING LONG-TERM DISABILITY OR HEALTH BENEFITS”

UNDER ERISA THE DEFERENCE AN INSURANCE COMPANY’S DECISION IS AFFORDED IS TIED TO HOW WELL IT COMPLIES WITH ITS OBLIGATIONS AS A FIDUCIARY

An insurance company, typically the party obligated to pay benefits and the administrator given discretion in construing and applying the provisions of a group health or disability plan and assessing a participant’s entitlement to benefits, is an ERISA fiduciary. See 29 U.S.C.§ 1002(21)(A)(i) and (iii); Aetna Health Inc. v. Davila, 542 U.S. 200, 220, 124 S. Ct. 2488, 2502 (2004); Mondry v. Am. Fam. Continue reading “UNDER ERISA THE DEFERENCE AN INSURANCE COMPANY’S DECISION IS AFFORDED IS TIED TO HOW WELL IT COMPLIES WITH ITS OBLIGATIONS AS A FIDUCIARY”

UNDER ERISA AN INSURANCE COMPANY MUST ENGAGE IN “MEANINGFUL DIALOGUE” WITH A LONG TERM DISABILITY CLAIMANT

Although a long-term disability claimant – the insured – carries the burden of showing she is entitled to benefits, ERISA administrators (usually, but not always, insurance companies) have a fiduciary duty to conduct an adequate investigation when considering a claim for benefits. Cady v. Hartford Life & Accidental Ins. Co., 930 F. Supp. 2d 1216, 1226 (D. Idaho 2013)(citing Booton v. Lockheed Med. Ben. Continue reading “UNDER ERISA AN INSURANCE COMPANY MUST ENGAGE IN “MEANINGFUL DIALOGUE” WITH A LONG TERM DISABILITY CLAIMANT”

UNDER ERISA AN INSURANCE COMPANY MUST PROVIDE A LONG TERM DISABILITY CLAIMANT WITH ITS SPECIFIC REASONS FOR DENYING OR TERMINATING BENEFITS

It is important for any claimant to know his or her rights under ERISA in making a long term disability claim. Section 1133 of ERISA reads as follows: “In accordance with regulations of the Secretary, every employee benefit plan shall – (1) provide adequate notice in writing to any participant or beneficiary whose claim for benefits under the plan has been denied, setting forth the specific reasons for such denial, written in a manner calculated to be understood by the participant, Continue reading “UNDER ERISA AN INSURANCE COMPANY MUST PROVIDE A LONG TERM DISABILITY CLAIMANT WITH ITS SPECIFIC REASONS FOR DENYING OR TERMINATING BENEFITS”

UPDATE ON TREATING PHYSICIAN RULE IN SOCIAL SECURITY DISABLITY CASES

In a previous blog it was noted that if a Social Security disability Claimant has obtained an opinion from his or her treating physician that is supportive of disability and is consistent with the overall medical evidence, then that opinion should be given deference by the Administrative Law Judge (“ALJ”) over any opinions submitted by Social Security’s medical consultants or consultative examiners. Continue reading “UPDATE ON TREATING PHYSICIAN RULE IN SOCIAL SECURITY DISABLITY CASES”

INSURANCE COMPANIES COMMONLY, AND IMPROPERLY, CHANGE THE REASONS FOR THEIR DENIAL DECISION IN AN ERISA DISABILITY CLAIM

Insurance companies act unreasonably when they terminate benefits for one reason, only to offer an entirely different reason for terminating the same benefits on appeal. See Wenner v. Sun Life Assurance Company of Canada, 482 F.3d 878 (6th Cir. 2007) (reinstating benefits where benefits terminated for one reason, then a different reason was offered on appeal). Continue reading “INSURANCE COMPANIES COMMONLY, AND IMPROPERLY, CHANGE THE REASONS FOR THEIR DENIAL DECISION IN AN ERISA DISABILITY CLAIM”