The Employee Retirement Income Security Act of 1974 is commonly referred to as ERISA. It is a federal law concerning employer provided benefits to employees. Generally, any retirement, health insurance, life insurance, accidental death & dismemberment, or disability insurance plan will be an employee benefit plan covered by ERISA, so long as it is established or maintained by your employer.
ERISA includes employee protections by mandating plans have minimum participation, vesting, accrual, and funding standards. It includes protections from employers discriminating in favor of highly compensated employees. ERISA § 502(a) permits participants and beneficiaries to bring civil actions against the plan to collect benefits due under the plan, for breaches of fiduciary responsibility for losses caused to the plan or your account within the plan, or for “other appropriate equitable relief.” ERISA § 510 also prohibits any person from taking any adverse employment action against you for exercising any of your rights under ERISA, and from interfering with your right to the attainment of benefits (for example, by firing you just before your benefits vest).
Many plan documents will explicitly tell you that the plan was established to comply with ERISA, leaving little doubt. In other cases, whether the benefits amount to an employee benefit plan covered by ERISA will hinge on all the facts and circumstances. Generally, any plan, fund, or program established or maintained by an employer for the purpose of providing benefits to employees is an ERISA covered plan. ERISA exempts certain things, though, such as wages, vacation time, sick days, and other payroll practices.
No. ERISA expressly exempts from its coverage employee benefit plans established or maintained by state, municipal, or other local governments or units or agencies therein. So public school teachers, police officers, firefighters, etc. have employee benefit plans not covered by ERISA. ERISA similarly exempts any church plans, but church plans can elect to be covered by ERISA.
ERISA requires any employee benefit plan be in writing. The plan documents literally are any documents or instruments under which the plan is established or maintained. Typically, there will be a master plan or trust document. The plan administrator also is required to distribute a summary plan description, which is a summary of the plan document commonly spanning 20–80 pages. The summary plan description must contain all the material terms of the plan, including the formal name of the plan, the name of the administrator(s), how to submit claims, and any procedure regarding internal appeals.
ERISA only proscribed statutes of limitations for claims alleging breach of fiduciary duty. The statute in those cases is 6 years from the alleged act or omission, or 3 years after the claimant had actual knowledge of the claim. What exactly the claimant needs to have had knowledge of differs from jurisdiction to jurisdiction. For all other claims made under ERISA (such a § 502(a)(1)(B) claim for benefits under the terms of the plan), ERISA provided no statute of limitations, and courts will look to the most analogous state statute of limitations in the appropriate jurisdiction. For a benefit claim, this will usually be a statute for breach of a written contract. However, courts have uniformly held plans are free to further limit that period, provided it is disclosed to participants, and they often do. These limitations still must provide you with a reasonable amount of time, though. That self-imposed limitations period, however, must still be reasonable to be legal. The summary plan description should state how much time you have to submit a claim, and how much time you have to bring an action in court. Call us if you need to know if the limitations period is likely to be upheld.
Generally no. ERISA requires plans include reasonable claims procedures, and include the opportunity to appeal a claim denial to a named fiduciary of the plan. You must exhaust all administrative claims procedures before filing a complaint in court. If you fail to exhaust these procedures, your case will almost certainly be dismissed for failure to do so. Only in rare circumstances will a court determine exhaustion was not required because, for example, it would have been futile.
No. I have heard clients tell me that the insurer or claims administrator told the client not to hire a lawyer until after the claims procedure had been exhausted. That would be an enormous mistake, and a way to almost guarantee you will not get the benefits you deserve. When seeking redress in court, the judge will limit her review to the record created before the insurer or administrator, meaning if you wait to get us involved until after you have exhausted internal appeals we cannot add value to your case by leveraging our experience to create the sort of record that is difficult for the insurer to deny a claim based upon, and that gives you the best chance of a judicial decision in your favor.
Yes. ERISA is an extremely complex and ever-changing area of the law. It is not conducive to a law practice that dabbles in the area or plans to learn as it goes. ERISA’s statutory, regulatory, and case laws are so expansive and constantly growing that lawyers who primarily represent individuals in injury or other employment matters cannot stay up to date with all the changes in the law. You should retain a lawyer dedicated to ERISA for your ERISA case.
Social Security laws and regulations provide a uniform definition of “disabled.” The definition of “disabled” in ERISA long term disability insurance plans varies from policy to policy, varies within a policy based on the time period after the initial onset of disability, and similar policy language can be construed differently in different jurisdictions. Social Security claims will be administratively decided by an Administrative Law Judge, an independent arbiter with no stake in the outcome. ERISA long term disability plans will usually administratively be adjudicated by the very insurer or administrator that stands to gain financially from denying your claim. The Social Security Administration has limited resources to dispute claims, so with each level of appeal, your odds of success increase. ERISA long term disability insurers and administrators have virtually unlimited resources to dispute your claim. The only way to increase your odds of success is to engage an ERISA lawyer who is as familiar with the process as the insurer and its army of lawyers and doctors.
Yes. Most, if not all, plans will require that in order to continue receiving benefits, you must be under the continuing care of a physician, and you must continue to submit the doctor’s notes to the disability plan insurer or administrator.
A mere conclusion from your doctor that you are disabled is useful but never sufficient to get you disability benefits. The evidence will have to clearly demonstrate why the doctor opined you are disabled.
Yes, or call back from your home telephone number when you are available. Insurers have been known to conclude that if you cannot be reached at your home telephone number, it means you must not ever be home and thus are not disabled. As flawed as the logic is, insurers use it as a basis to terminate benefits.
Yes. Even when you speak on the telephone, send a dated and signed letter confirming the substance of the conversation. That way, if the insurer’s notes of what you said differed from what you actually said, it will be documented. You should send the letter certified mail, with return receipt, and keep a copy of the signed and dated letter for your records.
If the disability plan insurer requests to have a case manager meet with you, you should politely accept. The case manager will invariably request to meet you at your home, portraying it as a courtesy to you. It is not a courtesy to you. The insurer wants the meeting to take place at your house so it can examine where you live to discover any basis whatsoever to terminate your benefits. Things as simple as seeing stairs in your home, or seeing a vacuum cleaner out, could form a basis (as unreasonable as it may be) for the insurer to terminate your benefits or deny your claim. You should meet the case manager, but agree to do so at a neutral location, and offer to meet when a family member or friend can drive or otherwise escort you.
If the insurer or claims administrator of a disability plan wants you to see an Independent Medical Examiner or have a Functional Capacity Equivalence evaluation, the first thing to keep in mind is that these “independent” individuals are not truly independent. They get hired by the insurer, and if they return opinions unfavorable to the insurer, the insurer will send the referrals to somebody else. I have heard clients tell me the IME or FCE evaluation did not accurately describe what happened, or left out critical parts of the evaluation. To protect yourself, either bring another person with you who will take notes, or better yet, video record the evaluation. You must, of course, obtain the evaluator’s consent to be recorded before doing so.
When assessing a claim of whether or not you are disabled such that you cannot perform functions and duties of your job, the long term disability insurer will most often not actually consider your actual job, but will consult a book which describes your job, the Dictionary of Occupational Titles or something similar. The definition may or may not accurately describe your job tasks, required hours, and physical requirements. You should be prepared to obtain a written statement from a co-worker or supervisor which describes your job, hours, and physical requirements.
Disability plan insurers and administrators do not want you or your doctor to provide thorough answers to their questions. Short, terse answers make it easier for the insurer or administrator to deny claims. Adding additional pages or an addendum helps provide the space you need to accurately and thoroughly answer any question.
Many illnesses will have your pain or other discomfort vary from day to day. You should avoid providing an average, or only describing what some days feel like. You should clearly describe that the pain or discomfort varies, by how much it varies, and how often you experience each level of pain or discomfort.
Avoid using words or phrases that can be open to interpretation or can be ambiguous. For example, if you state you “cannot walk far,” you may mean you can only move a few steps, but the insurer may read that to mean you cannot walk one mile. Be clear and objective with your words.
Yes. They will frequently send an investigator out to monitor your actions for several days. The investigator will observe you whenever you leave your home and note what he or she observed you doing, such as running errands, carrying bags, driving, how far you walked from the parking spot to the store entrance, and how long you were out of the house. Investigators will also search the Internet for your name, and immediately try to find any social networking pages, such as Facebook, MySpace, LinkedIn, Twitter, etc. If you post anything on those pages that is available to the public and that the insurer can construe as inconsistent with what you or your doctor has reported to the insurer, it will likely be used to deny your claim or terminate your benefits. For example, your limitations may state you cannot sit for more than 10 minutes, but you posted having a great day at the beach, the insurer will certainly terminate your benefits (even if you had to lie down the entire time).
Do not rely on the representative’s oral statement about what to do on appeal. You will receive a denial letter that advises you of your rights, and gives you time limitations. Merely submitting a written appeal, without any additional supporting documentation, is never successful, and will likely make your case between difficult and impossible to win after exhausting internal appeals.
Your employer-sponsored health insurance plan will offer you COBRA coverage after you are no longer eligible for the employer-subsidized participation. COBRA ordinarily allows you to buy the insurance coverage for 18 months. If you can demonstrate you were awarded benefits for disability from the Social Security Administration, your coverage under COBRA can be extended even further. Upon exhaustion of COBRA benefits, you will have to qualify for early Medicare benefits. Keep in mind, however, that beginning in 2014, you will be able to purchase individual insurance without being denied on the basis of preexisting conditions.
Most ERISA disability plans will require you to apply for benefits from the Social Security Administration, and will pay you the benefits after offsetting any benefits you receive from Social Security. The plans will not require you be awarded benefits, but you must try to get them. Some plans will even provide you with a lawyer to seek those benefits.
As stated above, most plans provide for a certain level of benefits after an offset for any benefits received from Social Security. So if you received a payment for past due benefits from Social Security, and were receiving payments under your employer-sponsored long term disability plan for that time period to which the past due benefits relates, the disability plan will be entitled to the entire amount. Plans often include terms stating how this can be enforced, which will include withholding your future benefits.