The Department of Labor’s Employee Benefits Security Administration just published final regulations that change the ERISA disability claims and appeals process.
Here are 10 things you should know about these new regulations.
- These new regulations apply to all claims for disability benefits filed on or after January 1, 2018. (Many of the changes were initially proposed in 2015.) So, give some thought now about putting in place new processes to address these upcoming changes.
- There should be no incentives to deny claims. Bonuses based on the number of claim denials are not allowed.
- Review the factors used to select a medical expert. Basing your selection on the physician’s reputation for outcomes in contested cases should be reassessed.
- Denial letters must include an explanation stating why the opinions offered by the claimant’s health care provider or vocational expert were rejected (or agreed with).
- Denial letters must explain why disability determinations made by the Social Security Administration were rejected.
- Denial letters must inform the claimant about the right to obtain the claim file, and other relevant documents. The denial letter should state any internal rules or guidelines the claims administrator relied upon in deciding the claim. If no such internal rule or guideline exists, the letter should disclose this as well.
- Denial letters must include a discussion about translation services under certain circumstances. When a claimant’s address is located in a county where 10% or more of the population is literate only in the same non-English language, the denial letter must include a notice in that non-English language about the availability of translation services. A copy of this letter (containing the notice of non-English translation services) must be provided upon request. Oral translation services must be provided.
- During an appeal, the claimant must be given notice and a fair opportunity to respond if the appeal denial is based on new or additional rationales or evidence.
- The appeal denial letter must specify plan imposed deadlines for filing a lawsuit, and the date the limitations period expires.
- Generally, if the claims administrator fails to follow its own claims procedures, then a claimant can sue without exhausting administrative remedies.
Some of these new provisions have been adopted already by claims administrators to address certain judicial decisions. There also is some chance that these regulations, attached in the link above, could be changed. But it is good to know now how you might be expected to handle claims starting about one year from now…
Happy New Year!