The question of why mental illness is treated differently from physical illness was raised in a recent California case, Harlick v. Blue Shield , 656 3d 832 (9th Cir. 2011). The case turned on the wording of a California statute which is not relevant to the purpose of this post.
What is most relevant is the reasoning behind the insurance industry’s effort to save itself money by classifying mental illness as less than physical illness. Those who have had first-hand acquaintance with mental illness know that there is very little, if any, difference in the disabling factor between the two. If your mind can’t cope with the duties of your occupation, it is as if you have a physical disability which prevents you from performing.
Psychiatric disabilities can sometimes be cured in weeks or months and sometimes not for years. The same is true of physical disabilities.
Yet, insurance companies frequently limit their obligation to pay LTD benefits to two years while physical disabilities will be paid for the term set forth in the policy.
This has led to insurance companies developing a new tactic – all employment disabilities are caused by psychiatric problems rather than psychiatric problems being triggered by physical disabilities. Now that the 2-year limit on paying for disabilities in disability income policies has become more or less standard, it has become the preferred denial “go to” for insurers when nothing else jumps right out at them.
If there is any psychiatric involvement at all in a disability income claim, you can bet your bottom dollar that the insurance company will be doing its darndest to say it was based upon a psychiatric disorder. These days, it has become almost a knee jerk reaction.
So, if you are hit with this defense, whether as a claimant or a lawyer, don’t accept it without scrutiny. The stakes are too high to take the carrier at its word.
Insurance companies are not all the same and don’t act the same, except in one regard:
They hate to pay claims!