How to Protect your Long-Term Disability Claim

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Peggy suffers from rheumatoid arthritis.  For years, she has struggled to perform her job duties at a data management firm.  Her job, which involves inputting data for 8 hours a day, was impossible for her to perform.  She couldn’t sit for long periods of time, and her disease made it impossible for her to type.  She thought that she had been fortunate enough to have paid for a long-term disability policy for years.  However, she was surprised when her long-term disability claim was denied.  She was shocked when her appeal was denied.  After her appeal was denied, she came to my office to file a lawsuit.  She was then heart-broken when I explained to her that there was not much I could do for her at that point.

Long term disability (“LTD”) policies are governed by a Federal statute named ERISA.  Under ERISA, there is a very stringent process for how a claimant is supposed to proceed to file and protect her LTD claim.  The following is a brief overview of how a LTD claim plays out:

  1. The claimant usually files the initial application for short term disability benefits. Once these benefits are approved, the claimant is supposed to file a LTD application within the short-term disability time period.  This is usually 90 days.
  2. The LTD application must include specific documentation from the claimant’s physician which outlines the long-term nature of the disability. The LTD application should include all medical records and an opinion report from the certifying physician.  Whether you qualify for LTD coverage depends on the nature of your disability and the terms of the policy.  Some policies are tougher than others to get coverage.  If it is an “own-occ” policy, you can only obtain LTD coverage if you are unable to perform the daily tasks required of your own   Many other policies are more general.  This means if you are a brain surgeon, but your disability still allows you to bag groceries, your claim can be denied.  The policy language is key.
  3. Once a LTD application is denied (and they usually are), you have a specific time frame to appeal the denial. This appeal is performed internally, and the insurance company will often respond by hiring an “independent” physician to review the documentation and rubber stamp their denial.
  4. Now that your claim has been denied and upheld in their internal appeal, you have no choice but to file a lawsuit in Federal court. These lawsuits are not normal lawsuits.  You cannot do any discovery into the insurance company’s file, and the only evidence the judge will look at is the insurance company’s internal file.  Under Federal law, the judge does NOT determine whether the insurance company was wrong, or made a mistake.  The judge is only supposed to determine if the insurance company abused their discretion.  This heightened standard is usually impossible to meet if the file is not papered properly.

This means that the most important part of the claims process, by far, is the application.  When applying for LTD benefits, you should make sure that the doctor’s reports are sufficient to cover the terms of your disability policy.  Having a lawyer insist with the application is key to winning these claims.  From the beginning, the lawyer needs to work with the attending physician to make sure the elements of an injury and inability to perform key job tasks are documented.

Unfortunately, most people wrongfully believe that their insurance company will review their LTD claim in good faith.  By the time the denial appeal is upheld, the application is locked in stone, and the claimant has no realistic path to recovery.  If you believe that you are entitled to LTD benefits, you should consult an attorney before submitting your initial application.  Failing to do so can cost you hundreds of thousands in benefits.

Dross Berman LLC has experience handling these complex cases, and offers free consultations.  Please call us at 240-403-7200 to discuss your potential LTD claim.