A Heartfelt New Year's Wish

It’s time to lift our head from our writing chores, look around and see where we have been and where we are going. A Happy and Healthy New Year Everybody!

As we approach the end of 2013, we have noticed that we are approaching a milestone – 200 full size blog posts about ERISA, insurance companies, disability claimants and related materials. That output is enough words to fill a full size hard cover book! Did we really have that much to say about ERISA and private disability claims? We did.

The question is – were those words helpful to people who needed guidance or information about ERISA and disability insurance and how to make claims in a way that will survive the land mines insurers seed in the path to benefits?

We certainly hope so. We represent only disability income insurance claimants – ERISA and private. Never in 35 years have we fought for an insurance company or an employer against a disability claimant. So, our posts primarily aim at informing and advising those making claims.

We’ll never know if our posts actually do inform unless people ask us questions or tell us about their experiences. The little insurance tricks and traps we are aware of can break the back of a perfectly valid disability claim, leaving the insured without a job or an income – maybe forever. What a depressing prospect, especially as we look forward to the New Year.

Despite what insurers and employers seem to think, disabilities are not high on an insured’s wish list. “Good health” is the toast most often drunk by most people on the holidays and throughout the year. Why do insurance companies almost automatically assume that a disabling illness or injury is something an insured wanted or needed?

Let’s start fresh. Let’s regain our enthusiasm. Let’s pump up our drive to keep letting the world know what really goes on in ERISA and disability land. Only then will the people we care about gain full advantage of the knowledge and experience they need to successfully manage an ERISA or disability claim.

So, our most profound New Year’s wish for each of you is that you will never need our services because you have becomes disabled and unable to work. Stay healthy and keep laboring at whatever you do.

But, if should ever need us, we’re here for you.



Impartial Medicine?

Just when you thought insurance companies had reached the ultimate in stacking the deck against insureds, they come up with a new ace in the hole. Now they are buying up groups of treating doctors, which they will own, lock stock and barrel

In other words, a doctor who is treating you for an illness or injury which may be the basis of a disability insurance claim and who has to file medical reports on your behalf, may be filing the reports with his or her boss – the insurance company.

Talk about a conflict of interest!

The reasoning put forth by the companies is that they will be able to control costs better if they control how the medical practice is managed. Sounds good, but if experience is any indication as to how it will actually work, hold onto your wallet.

Those who represent disability insurance claimants know that insurance companies usually have a contested claimant’s medical evidence “fine-tooth combed” by a doctor who is employed by a medical services company, retained by the insurance company. In most cases, the medical services company has few sources of income other than the insurer. Likewise, many doctors employed by the medical service company have few, if any, sources of income, other than their work for the medical services company.

It doesn’t take a genius to figure out that if the services company and its doctor employees know what’s good for them, they will tailor their medical findings to favor the medical service company’s customer, the insurance company. If they don’t, a substantial source of their income is likely to dry up and blow away.

Lawyers fighting for claimants in the disability income field learn that IMEs (so-called Independent Medical Exams) performed by a doctor employed by such a medical expert vendor, almost invariably result in a claim denial by an insurance company.

If this is the rule when the doctor’s agency employer is hired by the insurer, what is it going to be like when the insurer is actually the doctor’s “boss”? Is such a tighter relationship likely to make a doctor less favorably inclined toward the insurer?

Going a step further, the treating doctor recommends treatments and medication for the patient. If the doctor knows the insurer-employer pays for this wouldn’t there be an incentive to hold back, so as to make the treatment protocol less expensive? Isn’t that a clear conflict between the interests of the treating doctor, the insurance company for whom the treating doctor works, and the interests of the patient?

It seems clear that despite the growing trend of insurance companies buying medical groups, it should not be happening. Doctors are the people who actually define health claims, which in turn define the extent of financial liability of the insurance companies. The conflict of interest is too great if the insurer is actually the employer of a doctor defining the value of the claim against it

It’s bad enough that a whole medical service industry has grown up on the false premise that doctors who earn a large part of their living examining claimants for insurance companies can be neutral in their findings.

As a practitioner on behalf of claimants in the disability income insurance field for 30 years, we can attest that medical service IME doctors are anything but “independent”. If the doctors were direct employees of the insurance company, the odds of fair medical judgment would be laughable.

It is obvious that a patient wants a doctor to have only the patient’s interests in mind. A potential conflict of interest would have a devastating effect on the relationship. An actual conflict is terrifying.

On the basis of past insurance industry history, would anyone take bets that the insurance companies will not take the advantage that employing treating doctors affords?


The First 100 Is The Hardest

When we first started blogging on April 15, 2009, to try to help disability income insurance claimants, we had plenty of butterflies in our stomach because we had never blogged before and knew that a blog requires a long term commitment and exposes one’s thoughts to public view.

The first blog was written without having any idea of what the subject of the second would be. We just knew, somehow, that we had the “hands-on” experience and savvy in the law of insurance to help people with disability income and other complicated insurance problems.

So, here we are writing our 100th blog on April 21, 2011, just a tad over two years later.
Looking over our first hundred blogs, we found that some stand out in our mind either for informative content, originality or a nice turn of phrase. We thought, why not list them here for anyone to see what we are proud of.  So, here goes:

Pull In The Welcome Mat – A warning that insurance companies just love to cuddle up to claimants so they can evaluate a claimant’s strength and weaknesses. Hear this - the insurance company IS NOT your friend, no matter how friendly they try to seem. The adjuster’s job is to destroy or diminish your claim. A friendly adjuster is just a viper waiting to strike. The rule: Be as cooperative as the policy and law require; not one whit more.

Hippa, Hippa Hooray – People with psychiatric disabilities have special needs because they usually are mentally fragile and need understanding and protection. Insurance companies love to get inside this type of claimant’s head. Shock them and move their world around and the psychiatrically disabled may be unable or unwilling to pursue the claim. That’s why providing medical info to insurers should be and can be strictly constrained by mental health professionals and attorneys. However, many are unaware of this and are unwittingly providing psychiatric notes and other reports that are strictly forbidden by Federal law. Case notes and similar material must not be provided to insurance companies. Both the attorney and the mental health professional have a duty to protect a client’s personal, psychiatric information.

No “Do-overs” in Disability Claims – Don’t start learning the ropes when you file a disability income insurance claim. This very first step in this process may be the one that sinks you. If you or your doctor omit a necessary fact required by the insurance policy or the law, the insurer will hang onto that omission throughout the claims procedure so as to cast doubt on your claim. Get it right from the get-go.  Starting “fresh” is not an option in an income disability claim.

No Good Deed Goes Unpunished – Old habits are hard to break, but an old habit can break a claimant. If you have an “own occupation” policy, you can’t be Mr. Nice Guy with your employer. Most people want to try to keep working if they can, despite a disabling event. They might try to work doing something else, if they can’t do their usual occupation. If they do that with an “own occupation” policy, the insurer will pay you what you were earning at the time you were forced to give in and stop working, rather than at the rate you were earning at the time you first were disabled. If you have such a policy, stop working when you are unable to perform the job listed in the policy. Trying to be a “hero” can cut the legs from under you.

Insurers Love “Docility” – Disability insurers just love people who don’t make waves. If an insurer first denies a claim (an almost automatic insurer reaction), many of these “waveless wonders” will just go away, giving up valid claims and dropping those claim dollars to the insurer’s bottom line. Disability income insurance claimants need backbone to stand up to the insurance company and get what was paid for in premiums.  In other words, for your own benefit, Don’t Be A Wimp.

So, there it is – 100 blogs and counting. We hope to keep blogging until every DI claimant gets a square shake from the insurance company.

Unfortunately, even Methusaleh didn’t live long enough for that to happen.


Legal Fee Law Reins In Insurers

The scales of Justice weigh heavily in favor of insurance companies generally, but even more so in disability income claims. After all, insurers are well funded, have their health, and employ plenty of lawyers who are familiar with the “ins” and “outs of the business.

A typical disabled employee, on the other hand, frequently has little or no funding (being unable to work), has little experience in law, and hasn’t a single friend, relative or neighbor who even knows where a law school is located, let alone having attended one.

The issue of whether a mental or physical impairment truly prevents a claimant from performing the duties of employment can be a complex question, even if it is conscientiously considered by people who have no financial interest in the outcome. When you add the financial interest insurance companies have in the outcome of these questions, the issue becomes more vexing because if they agree that the employee is disabled, they pay – and insurance companies hate that.

This leads to a situation in which insurers make claimants run through hoops in an effort to discourage them because there is very little downside to such conduct. Most states make each litigant pay for his or her own legal fees and costs. So, if an insurer makes a claimant sue and loses, what’s the downside?

In the 2nd Circuit Court of Appeals, which includes New York, Connecticut and Vermont, ERISA claimants get a leg up from a line of cases starting with Birmingham v. SoGen-Swiss International Corporation Retirement Plan, 718 F. 2d 515 (2nd Cir. 1983), which hold that although the award of counsel fees and costs is discretionary with the court, the 2d Circuit favors awarding counsel fees in ERISA cases unless there is a particular justification for not doing so. This judicial attitude in the Circuit makes insurance companies think twice in ERISA matters before saying “No” just because they can with impunity.

A road map for evaluating the merits of the right to attorney’s fees, was set forth in Chambless v. Masters, Mates & Pilots Pension Plan, 815 F. 2d 869 (2nd Cir. 1987) and has generally been followed in the Circuit. The major points of the scorecard are:

Culpable conduct (i.e., arbitrary and capricious) by the insurer.

The defendant has the financial resources to satisfy an award.

The merits of the case favor such an award.

The award of attorney fees would tend to deter defendant insurer and others from violating ERISA regulations in the future.

The results in the case confer a common benefit in that the defendant and other insurers will think twice before violating ERISA’s requirements in future.

Nobody wants an illness or injury which eliminates their income or employment. But for those unfortunate enough to face this condition in the 2d Circuit, there is some comfort in knowing that if they are covered by ERISA, arbitrary denials can cause insurers to bleed.






Back To Basics

Sometimes getting back to basics is the most helpful way to keep people informed about their disability income insurance coverage. One of the most basic of the basics is to read and understand your disability income insurance policy. It has always distressed us to find that many, many people don’t read their policy - the contract under which they will present a claim for benefits.

The first basic is what type of disability income insurance you have. Is it a group policy covered by ERISA or is it an individual policy?

Many policyholders are not certain of the difference the answer to this question makes in terms of coverage and requirements for proving a claim of disability.

An ERISA policy purchased by an employer for employees is not nearly the same as a policy bought by an individual. The ERISA policy is somewhat of a mystery to the employee because usually no policy is delivered to the individual. The employer has the policy and may give the employee only a Summary Plan Description (“SPD”) of what is in it.

Anyone familiar with insurance companies and policies knows a summary does little good when a claim is contested and the insurance company looks into every nook and cranny of the policy language to find a reason not to pay.

So, if you are covered by an ERISA policy it would be most wise for you to take a good look at it before a disability arises so that you know what protection you have or don’t have and can prepare yourself before a sickness or injury strikes. Ask your boss or your Human Resources Director for a copy so you can read and understand the ERISA policy yourself.

But because a disability income policy may be privately purchased and not subject to ERISA doesn’t mean that it doesn’t remain a mystery. If a policyholder doesn’t read and understand the terms of the policy, the individual doesn’t really know what protection is afforded and is, therefore, as much in the dark as an uninformed ERISA policyholder.

Relying on an insurance agent’s or an insurance company ad’s description of what protection is in the policy is never a good idea. It is a particularly bad idea when a disability income policy is involved because of the complications of exactly what is covered, how it is covered, for how long it is covered, and the difficulty of the hoops the policyholder will have to go through to get benefits.

In both ERISA and individual policies, once you know what you have, you are able to decide if that coverage is what you want for yourself and your family. If it is – fine. If it is not, then you may seek to change your individual policy or buy additional individual coverage to add to an ERISA or private policy to bring your coverage up to your standard.

Either way, once you understand your policy, you will be certain of what protection you have before disaster strikes and it is too late to do anything about it.

We know all too well that insurance policies are boring to read and difficult to understand. But, don’t be lazy. Don’t be intimidated. Take your time. You can do it!

But, if you do all of the above and you still have questions, get the answers you need now while you can still do something about any changes you might want to make for the sake of yourself and your family.