Table of Contents
Chapter 1: Is Your Disability Policy an ERISA Policy?
Chapter 2: Appealing the Denial of Disability Insurance Benefits – ERISA Policies
Chapter 3: Non-ERISA Policies
Chapter 4: Exertion Levels
Chapter 5: Understanding Your Policy
About the Author
Introduction: Who Is This Guide For?
Individuals who, due to illness or injury, can no longer continue to engage in full-time employment. Although we cannot guarantee that the appeal of your claim will be approved on the first try, this guide will help you prepare an appeal that is clear, concise, and complete with all information necessary to support your claim.
We also recommend that you utilize our Ultimate Appeal Checklist. This free checklist will assist you in gathering the evidence you need to provide the claim adjuster with proof of your disability.
Disability Insurance Appeal Guide: Chapter 1
What is an ERISA Disability Plan?
Many medium to large-size companies offer benefits through an ERISA-governed disability plan. But what’s the difference between an insurance policy and an insurance plan? Typically, the long-term disability policy is one part of an overall benefits plan. The benefits plan may include other benefits like life insurance, health insurance, disability benefits, and other types of group plan benefits.
Is Your Disability Policy an ERISA Policy?
ERISA, which is short for the Employee Retirement Income and Securities Act of 1974 has certain requirements for plan administrators like your employer who’s offering these benefits. Specifically, ERISA requires the plan administrators to provide participants with key information about the plan benefits, the funding of the plan, their fiduciary responsibilities, management of the plan, the grievance process, and appeals process for denials under the plan.
One thing that’s really crazy is that ERISA allows plan administrators to interpret the plan provisions so long as there’s a clause in the policy that allows them to interpret the plan provisions, which means the insurance company is allowed to determine whether or not you meet the requirements of the policy.
If you are covered by a Group Long Term Disability Policy through your employment, your claim is probably governed by ERISA. As stated throughout the remainder of this website, if you did not obtain disability coverage through your employer or employee group, and instead purchased it as an individual policy from an insurance agent or broker, then there is a good possibility that your disability claim will not be covered by ERISA and your legal options and remedies are more favorable. Moreover, church and governmental (including most City and University) employees are also exempt from ERISA.
What to Do If You Are Denied Coverage for a Non-ERISA Policy
If you have church policy, a governmental employee policy, or an individual disability policy purchased directly from an agent or broker then you may not have to appeal the denial before filing a lawsuit. In these instances, you should consult an attorney immediately.
Disability Insurance Appeal Guide: Chapter 2
Appealing The Denial of Disability Insurance Benefits – ERISA Policies
You should not give up if the insurance company denies or terminates your claim for long-term disability (LTD) benefits. Most employees have disability insurance coverage through a group plan with a private-sector employer. If your employer is large enough, or if you obtained your policy through an employee organization or union, then ERISA rules and regulations come into play. According to ERISA, you must “exhaust” your administrative remedies before you can file a lawsuit. This means you must follow the terms of the insurance policy and go through each step of the appeals process directly with the insurance company. If the insurance policy states that you must file one appeal, then you may only need to file one mandatory appeal. If the insurance policy requires you to file two appeals, then you must go through two appeals before filing a lawsuit. Other insurance policies have one mandatory appeal and one “optional” appeal.
It may seem unlikely that the same insurance company that denied your claim will suddenly change its mind and approve you on appeal. However, the appeals are evaluated by a different claims handler at each level of appeal and the new claims handler may just disagree with the denial. Many claimants receive benefits during this appeals process.
Step by Step Guide to Appealing the Denial of Your Disability Claim
BEFORE YOU START: Read and Understand the Denial Letter
Your denial letter should specify why your claim was denied and how to file an appeal. Pay close attention to the reasons given for the denial so you can determine how you proceed with your appeal. For example, if you were denied because the insurance company stated your claim file lacks “objective documentation”, you would want to submit additional CT-Scans, x-rays, or MRIs.
Insurance companies often cite the same reasons as to why they are denying your claim for long term disability benefits:
- Long-term disability insurance carriers will frequently deny claims by claiming there is insufficient evidence or a lack of objective medical findings to support your claim. One example would be a case involving back pain. You may have submitted the results of an x-ray, but perhaps an MRI or a CT scan would make for better evidence. In a mental health claim, cognitive deficits or difficulty thinking and processing information can be proven with neuropsychological testing. A letter from your doctor stating that you are disabled is insufficient.
- Clerical and procedural errors can also lead to claim denial. Maybe your doctor or employer didn’t fill out a form that was necessary to process your claim. Another procedural issue would be that the claim wasn’t brought in time. In most cases, you only have a specific amount of time to bring your long-term disability case to the insurance company’s attention.
- Disability insurance companies frequently deny claims based on surveillance video of the claimant. The insurance company will hire a private investigator to conduct surveillance and record your daily activities, and if there is evidence that the claimant is engaged in an activity that seems to contradict the limitations in their medical evidence, then the surveillance video can be used as a basis for denial.
- Certain illnesses or injuries are excluded in most policies. For example, some long-term disability policies will not pay benefits for a disability that is caused by a self-inflicted injury. If you are disabled due to an injury that was incurred during criminal activity, then a lot of policies will say that you cannot receive benefits for an injury that you received while engaged in criminal activity.
- One of the most common reasons for denial is a pre-existing condition. A pre-existing medical exclusion will usually apply if you just recently started working for the employer. In most instances, if your disability begins within one year of employment and you received treatment for that same condition within three months prior to your employment, then you may not have coverage for that condition.
- Contradictory evidence on your social media is a big one – especially Facebook. Oftentimes, the insurance carrier will review your Facebook profile and download any pictures or videos that you recently posted. Let’s say that the pictures/videos show you engaged in certain activities. The disability insurance company may use that visual evidence against you.
- Let’s say that there’s false information that’s put on a form, or a form completed by a doctor was manipulated, then that can be the basis for denial due to fraud or misrepresentation.
- Claims are also denied because the patient or the claimant is not getting enough treatment, or they’re not following prescribed treatment by their doctor. If a doctor is prescribing a certain treatment that may improve the claimant’s medical condition to the point where they may even be able to return to work, but the claimant is not undergoing that treatment (so the claimant can remain on disability), then that can be a basis for denial due to noncompliance.
- The claimant must meet all the eligibility requirements under the policy to have coverage, and even those that are non-medical in nature. Many policies require you to have worked a certain number of hours or worked a certain number of days to be eligible for long-term disability coverage.
- You must always look at the actual definition of the term disability in your policy. Each policy specifically defines how they evaluate the term disability. Under most policies, you’re only considered disabled if you cannot perform all or substantially all of the material duties of your occupation. Oftentimes, the definition of disability changes over time, such that after two years it’s not just whether you can do your job, but whether you can do other occupations that you are qualified for.
STEP ONE: Calendar Your Appeal Deadline
If your disability policy is part of a group plan subject to ERISA, you will have 180 days to send your written appeal and supporting medical evidence. These time limits are very important! That is why you must read the denial letter and your disability policy carefully to determine everything you must do to make sure your appeal is timely and properly filed. Remember – if you have a claim governed by ERISA you will not have the opportunity to testify or submit any new evidence during the federal court lawsuit. That is why you should make sure to “pack the record” with all the evidence to support the claim that you can possibly muster.
STEP TWO: Request a Full Copy of Your Disability Plan and Claim File
Before you file your appeal you should request your complete claim file in writing from your insurer (i.e., via fax, mail or email). Your claim file is made up of all the medical records, internal notes and memos, correspondence, outside doctor reviews, surveillance video, and any other information the insurance company reviewed while deciding your claim.
STEP THREE: Make Doctors’ Appointments
When the insurance company is reviewing your long term disability claim, they will be evaluating your credibility. They will be looking to see if the evidence you provided proves that you have been truthful about your symptoms, pain levels, and inability to work.
The most common way the insurance company checks this is to see whether you sought treatment for your disability. Naturally, if you have not seen a doctor about your disability, you will have no evidence to support your claim, and you will be denied. The meaning of “treatment” is more than just an initial visit to the doctor for a diagnosis. “Treatment” refers to the continuous amount of time that you will need to see doctors, take medication, have physical therapy, lab work, and the like. This is also referred to as your treatment plan.
If you trust your doctor to support your claim for disability then you should obtain a residual functional capacity form or medical source statement. If you see multiple doctors, try to obtain a statement from each one. Be aware, however, that overly conclusory statements, such as “the patient is completely disabled and unable to work” are useless. You can download a free RFC form from our website.
The claims examiners deciding your claim are not interested in short, conclusory statements from your physician. Your doctor should explain why you are unable to work as well as an evaluation of any restrictions or limitations you have regarding your ability to lift and carry weight, walk, sit, stand, range of motion, and more.
A lot of doctors do not want to provide a statement with this much detail, even though it is exactly what you need to support your claim. If you are serious about winning your claim, you should try to obtain this type of statement from your doctor, despite their resistance.
STEP FOUR: Review Your Claim File
Claims are usually denied because you did not provide sufficient evidence for approval, which is why it is so important to double-check everything before you submit it.
- Did you provide the correct doctor’s names and addresses?
- Did you provide the correct dates of service?
You need to be aware of the evidence in your claim file so that you know what additional information you need to submit. If you find that records are missing, you can submit the records with your appeal to make sure all positive medical evidence is in the claim file when the insurance company renders its decision.
Most claims are denied due to simple mistakes that can lead to months of frustration for you. Some insurance companies will try to point out “bad facts” that are on your medical record. This could be drug abuse, alcoholism, working after you say your disability started, or a doctor notating that you are exaggerating your claim.
STEP FIVE: Request Updated Medical Records From Your Medical Providers
The longest and most tedious process is gathering your data to prove your disability. After you read through your policy, you should be able to determine if you may qualify for LTD based on your insurers’ definition of disability. You will need to provide the claim adjuster with proof of your disability. This will include the opinion and notes from your treating physician(s), all lab and test results, x-rays, MRI scans, notes from doctors that have treated you, and detailed surgical reports. This information will need to be gathered from all doctors that are treating you for your disability not just your primary physician.
At the end of the day, it is the claimant’s burden to prove that a physical or mental condition has so negatively affected the claimant that the claimant can no longer continue in his or her career. Most insurance policies require proof of objective evidence before the insurance company will pay out benefits on an LTD insurance claim. This is the evidence that insurance companies cannot deny exists.
STEP SIX: What to do at Your Doctors’ Appointments
To learn what your residual capabilities are, the insurance company may ask for you to take an Attending Physician’s Statement (APS) form to your doctor (this form is also known as a Residual Functional Capacity form). If the insurance company claims handler does not believe the APS is sufficient (for example, if the doctor’s responses on the form are totally inconsistent with the medical records in the claim), the adjuster may schedule you an appointment to attend an “Independent Medical Examination” by a doctor hired by the insurance company. This doctor will then perform an RFC (residual functional capacity) assessment for your claim. The examiner will determine what level of exertion you are capable of performing, and what restrictions you have that may limit the jobs you can do. The medical examiner may also review your medical records and your doctor’s notes about your functional abilities and restrictions to come up with your RFC.
An RFC form assesses a disability claimant’s “residual functional capacity,” which is the claimant’s functional capacity (ability to function or perform work activity) that remains after taking into account the claimant’s mental and/or physical disabilities.
An RFC is also commonly called a Medical Source Statement or an Attending Physician’s Statement.
A statement from a treating doctor can often make the difference between winning or losing a long term disability claim. But that does not mean any statement will do. The statement should not be too brief to be of any use or too conclusory. I cannot tell you how many times our office has received a call from an excited client and the client says the doctor wrote them a statement that will win the case. We tell the client to bring the statement into our office. It is typically an extremely short note on a prescription pad that says little more than “My patient is completely disabled and unable to work”.
I’m afraid to say that this type of statement is extraordinarily useless to the insurance company disability claims examiner (who makes the decision on an application for disability or on the appeal).
There is no question that the LTD insurance company is very interested in receiving the opinion of a claimant’s treating physician. In fact, most insurance companies have an Attending Physician’s Statement to be filled out by a doctor as part of the disability claim application. The form should only be completed by a treating physician, as they are qualified to give a valid opinion as to your condition and how it affects you.
If your disabling condition is mental, your treating psychiatrist or psychologist should use a mental RFC form to indicate which cognitive deficits you have such as:
- Trouble retaining information, learning information, concentrating, getting along with supervisors or co-workers;
- Poor memory, decreased energy, illogical thinking;
- Concentration and attention; and
- Ability to interact socially in work settings, assimilate new information, and successfully engage in SRRTs (simple, routine, repetitive tasks).
STEP SEVEN: If You Find Yourself Running Out of Time
While preparing your appeal you may find yourself running out of time. If so, you should immediately send an appeal letter to the insurance company enclosing all the evidence you have gathered thus far and request more time to submit additional evidence. Even if you haven’t obtained any evidence at this point, send your appeal letter to the insurance company anyway.
You do not have to wait to hear back from the insurance company. Even if the insurer denies your request for an extension, continue to submit additional evidence in support of your appeal until the insurer issues its appeal decision. If you are unable to obtain additional evidence prior to the insurer issuing its decision, the appeal letter alone is enough to fulfill your duty to file an appeal.
STEP EIGHT: Submitting Your Appeal and Waiting
You should not submit your appeal to the insurance company before you have obtained and reviewed your entire claim file and policy (unless you are on a deadline).
You should not submit a simple letter as your entire appeal. The most important part of your appeal is the additional evidence you should be submitting with your appeal letter. Besides pointing out why you think the insurance company’s decision to terminate or deny benefits is wrong, you should submit updated medical records, opinion evidence (such as a letter or Attending Physician Statement) from your doctors identifying the symptoms and limitations that prevent you from working. Your appeal letter should be more like a cover letter, identifying why you disagree with the insurance company’s decision, and enclosing the information that may change the insurance company’s decision. This is a critical stage of the claims process. In most cases involving an ERISA-governed long term disability policy, the claim is closed once a decision is made on your final appeal. This is why it is important to submit all records you think you may need in future litigation during the appeal. Any information you leave out may never be heard or considered by a federal court in litigation!
Do not submit your documents by “regular mail”. You should be using a trackable method of shipments, such as Federal Express, Overnight Mail, or certified mail.
You should not “appeal” your case on the phone and you should not answer many questions from the insurance company over the phone. You should request that all communications be in writing, in traceable forms such as certified mail, fax, or e-mail.
The appeal is filed with the updated supporting documentation, and from that point, the insurance company has 45 days after receiving the appeal letter to make a decision. The insurance company can extend the decision process by another 45 days if they request it in writing before the end of the first 45 days. By law, the insurance company must reach a decision within the 90 day period.
Disability Insurance Appeal Guide: Chapter 3
There may be other situations where you do not have to file an appeal at all before filing a lawsuit. Generally, if you have an individual policy purchased directly from an insurance agent or broker, or if your policy is sponsored by a government or church employer directly (in other words, if the policy is not through a union or employee organization), then you may not even have to file any appeals with the insurance company before suing the insurance company in court. You should really look at what your insurance policy requires, and if there are some required appeals in the policy itself.
While you’re not subject to the same stringent requirements under ERISA, you are still subject to whatever the requirements are under your policy. It’s oftentimes good to have an experienced attorney who knows the differences between ERISA and non-ERISA policies and can help you evaluate what your rights and responsibilities are under the different types of policies, to help you look at the file, look at the policy, and help explain to you what it is that you need to do to get your benefits either instated or reinstated.
Disability Insurance Appeal Guide: Chapter 4
Your physical Residual Functional Capacity (or RFC for short) will determine whether you can perform sedentary, light, medium, or heavy-duty work. For example, if your doctor has restricted you to walking and standing no more than two hours total in an eight-hour day, your RFC will be for sedentary work. Here is a more detailed breakdown of the various exertional levels:
Sedentary Work: A sedentary job is one that is primarily sitting, with occasional walking and standing. To perform a sedentary occupation, you usually do not need to lift and carry more than ten pounds at a time, and you may be required to occasionally lift or carry things like files or small tools.
Light Work: Light work typically requires frequent walking and/or standing, as well as the ability to reach, push and pull with your arms or legs. Light duty jobs typically require the ability to lift and up to 20 pounds occasionally, and up to ten pounds frequently. If one can perform light work, one is generally considered capable of performing sedentary work.
Medium Work: A medium-duty job typically requires one to be able to lift and carry up to 50 pounds at a time, and the ability to frequently lift and/or carry up to 25 pounds. If one can perform medium work, one is generally considered capable of performing light and sedentary work.
Heavy Work: Heavy-duty work typically requires the ability to lift and carry up to 100 pounds at a time, and the ability to frequently lift and/or carry up to 50 pounds. If one can perform heavy work, one is generally considered capable of performing medium, light, or sedentary work.
Very Heavy Work: Very heavy work typically requires the ability to lift and carry objects that weigh more than 100 pounds, and the ability to frequently lift and/or carry 50 pounds or more. If one can perform very heavy work, one is generally considered capable of performing all other levels as well.
Your RFC will also include any non-exertional restrictions, such as not being able to stoop, use your fingers, or remember instructions.
Your mental RFC will determine whether you can perform work-related mental activities. When evaluating the claimant’s mental residual functional capacity, the claims handler will look at four primary functional areas: (1) understanding and memory; (2) social interactions; (3) sustained concentration, persistence, and pace; and (4) adaptation to changes in the work environment.
Thus, a mental RFC form completed by a mental health professional (such as a psychologist or psychiatrist) should make reference to a claimant’s mental impairments due to the claimant’s mental conditions (for example, memory issues, lack of energy, illogical thinking, and so on).
Disability Insurance Appeal Guide: Chapter 5
Understanding Your Policy
One of the first things you need to do is obtain your policy from your employer’s human resources department so you can review the terms of your policy. HR may delay providing you with this documentation. If you request your policy verbally or in person, and you do not get a response within the next week, you should send a letter requesting a copy of your policy. If you receive a summary of benefits that does not answer all of your questions, you need to request a copy of your complete policy.
How Does Your LTD Policy Define “Disability”?
Every long term disability policy has a definition of what “disability” means to the insurance company. They are usually “totally disabled” which means you can no longer work at all and “partially disabled” which means you can no longer work full time in your current job. It is also important to know that your policy will outline exactly what they consider to be a disability, and your injury or illness must meet those minimum criteria to be eligible for benefits.
What Are the Minimum Work Requirements?
The majority of disability policies require that you maintain full-time employment over a specific period of time in order to qualify for benefits. The exact requirements vary and will be outlined in your policy. Be sure that you have worked the minimum amount required before applying for disability benefits.
What is the Waiting Period?
Most long-term disability policies also have a waiting period (also known as the “elimination period”), which is the amount of time that you have to wait to receive benefits. For LTD claims, the elimination period is typically between 90 and 180 days, but you must check your policy for the exact number. You are also required to exhaust your STD benefits before you can apply for LTD benefits.
Pre-existing Conditions and Exclusions
Under most LTD policies – if you have a pre-existing condition, you will not be eligible to receive benefits for an illness that starts before the end of the first 12 months following your effective date of coverage. Some workplace illnesses and accidents are excluded from LTD policies. The use of alcohol and drugs or diseases caused by them are usually excluded as well. There is also a 24-month cap on long term benefits for mental health-related illnesses.
Change in Definition of Disability: Transition from “Own Occupation” to “Any Occupation”
The majority of group disability policies include a provision that changes the definition of the term “disability” after a certain period of time, typically 24-months. During the first 24-months, most LTD insurance policies employ an “Own Occupation” standard.
After the initial 24-month period, a claimant may be eligible for continued benefits if he or she is unable to perform any occupation. A typical LTD policy defines “any occupation” as “any occupation that the claimant is or becomes reasonably fitted by training, education, experience, age, physical and mental capacity” to perform. Most courts have interpreted such language to mean that your claim may be terminated if you’re medically capable of performing virtually any job that exists in the economy, although this determination does not consider what jobs are available.
Mental / Nervous Conditions and Disabilities Diagnosed by Subjective Complaints
A lot of group disability policies also have a 24-month limitation for claims involving disabilities arising from mental, nervous, and psychological impairments such as depression, anxiety, post-traumatic stress disorder, agoraphobia, obsessive-compulsive disorder (OCD), or a similar impairment. However, you may be eligible to receive benefits beyond 24-months if you are institutionalized or confined to an inpatient treatment facility when your 24-months expire (subject to a cap).
Organic mental disorders like dementia and organic brain disease, and perhaps even mental illnesses such as schizophrenia and bipolar disorder, may be excluded from the mental condition limitation. Review the language in your policy carefully to determine which conditions are subject to the two-year limitation and which are exempt.
A two-year limitation may also apply for chronic pain conditions such as arthritis and chronic back pain, and for medical conditions that are primarily diagnosed based on “subjective” complaints, including chronic fatigue syndrome and fibromyalgia.
Disability Insurance Appeal Guide: About the Ortiz Law Firm
The disability insurance attorneys at Ortiz Law Firm represent disability insurance policyholders in individual disability, group disability, and ERISA long term disability claims. Our experienced legal team also represents individuals with disability policies covered by “self-funded” employer organizations, such as Solutia and UnitedHealth Group.
We assist claimants in filing administrative appeals in their disability claims in an attempt to restore the benefits. We also have no problem filing a lawsuit against the disability insurance carrier.
Ortiz Law Firm has filed countless appeals and lawsuits against all of the major disability insurance companies, including Aetna (now the Hartford), CIGNA (now New York Life), MetLife, The Standard, UNUM, Lincoln National (and recently acquired Liberty Life), Mutual of Omaha, Paul Revere, Assurant, Sun Life, and Prudential.
We offer a free consultation to disability insurance claimants whose claims have been wrongfully denied or terminated. Nick Ortiz routinely consults with disability policyholders to evaluate their cases and provide legal advice with respect to their options moving forward. Call our office at (888) 321-8131 or contact us online to schedule your free case evaluation.