The Supreme Court heard arguments yesterday in Retirement Plans Committee of IBM v. Jander, an ERISA case challenging the prudence of fiduciary decisions with respect to an employee stock ownership plan (ESOP).  The Court granted certiorari to review whether the Second Circuit correctly applied the Court’s “more harm than good” standard set forth in Fifth Third Bancorp. v. Dudenhoeffer to a claim that fiduciaries, who were corporate insiders with information that the company stock was overvalued, should have made a corrective disclosure before allowing the plan to make continuing investments in that stock.

Of the three ERISA cases that Court is looking at this term, Jander is the most confounding and the argument yesterday did little to clear things up.  This is mostly because the case concerns the meaning and application of Dudenhoeffer, a decision that attempted to describe pleading standards in the hazy terrain where corporate securities obligations end and ERISA fiduciary duties begin.  But the fact that the Petitioners (IBM plan fiduciaries), the government and the plan participant all proposed different standards, only one of which was based on Dudenhoeffer, added to the confusion.

Several Justices expressed some concern that the petitioner’s broadest argument – that corporate insiders who are fiduciaries have no ERISA duties when they learn of problems with the company stock – and the government’s argument that almost any disclosure not required under securities law would be inconsistent with that regime, would require them to scrap Dudenhoeffer.  Perhaps most interestingly, Justice Gorsuch noted that corporate insiders don’t have to serve as fiduciaries and thus the problem presented in the case was, to some extent, self-created.  But he also questioned whether the securities laws might not be the most logical place to look when considering what actions a fiduciary with insider information should take to protect ESOPs.

In addition to dealing with short term disability benefits, long term disability benefits, and health insurance denials, many of our clients are also tasked with keeping track of changes to their Social Security benefits. Here are some of the changes that will take effect on January 1, 2020 for Social Security recipients –

  • Social Security recipients will get a 1.6 percent cost-of-living adjustment (COLA) in their monthly benefits starting in January. The average individual retired Social Security beneficiary is expected to see a monthly benefit jump from $1,479 to $1,503, an increase of roughly $24 per month or $288 for the year.
  • As a result of the COLA, the maximum monthly benefit a single recipient can get also will grow. That benefit will increase from $2,861 per month in 2019 to $3,011 per month in 2020.

Kantor & Kantor Partner Elizabeth Hopkins filed an Amicus Brief in the Supreme Court on October 28, 2019 for The Pension Rights Center in support of the Ninth Circuit in Intel Corp. Investment Policy Committee et al. v. Christopher M. Sulyma  The case is about whether workers get six years or three years to sue over ERISA violations.

Please see the brief here:  18-1116bsacPensionRightsCenter

For questions on the handling of your Pension benefits, please do not hesitate to contact Kantor & Kantor for a no-cost consultation at (800) 446-7529 or use our online contact form.

In his October 28, 2109 Opinion piece published by The Philadelphia Inquirer, Ross Waetzman opened with this harrowing sentence, “I almost died because of insurance prior authorization rules.” His story went on to share the details of how he nearly died as a result of the decision made by his insurer, Independence Blue Cross (“IBC” or “IBX”), to deny authorization of benefits for a test that had been recommended by Mr. Waetzman’s cardiologist.

The test Mr. Waetzman’s cardiologist had recommended was a cardiac catheterization. The test was necessary because Mr. Waetzman’s history of chest pain had been increasing in intensity, despite lifestyle changes he had made in an attempt to curb his symptoms. The cardiac catheterization was recommended by Mr. Waetzman’s cardiologist after less-invasive tests had been performed. Those less invasive tests, an EKG and a coronary calcium test, revealed that Mr. Waetzman was in the top 10% for his age and race for calcium deposits on his coronary arteries. With such deposits known to result in reduced blood flow to the heart, the cardiac catheterization was recommended to determine if Mr. Waetzman’s chest pain was a result of a blocked artery.

Unfortunately, when Mr. Waetzman’s cardiologist, Dr. Kenneth Mendel, called IBX, he was informed that “prior-authorization” for the cardiac catheterization was denied. IBX claimed that Mr. Waetzman did not meet all the necessary criteria to have the test and his only available option was to appeal the denial.

A functional capacity evaluation (FCE) is a series of tests that is used to measure a person’s functional physical ability to perform certain work-related tasks. A good, reliable FCE has validity measures embedded within the tests to show that the person taking the tests is putting forth the most effort he can, given his physical limitations. FCEs have many purposes, but in long term disability, we use them to provide objective support of a client’s physical restrictions and limitations with respect to his own occupation or any occupation, if that is the stage of his claim.

Often, in LTD cases, your physician will be asked to complete physical capacity forms. Having an FCE report will assist your doctor in this endeavor by providing her with the exact measurements she needs to provide her opinion.

If you have a condition such as degenerative disc disease, back pain with radiculopathy, fibromyalgia, or many other conditions that result in physical limitations, an FCE can be a very good tool to precisely measure exactly how limited you are by your disabling conditions. We can then use the FCE results to gather further support for your claim by giving it to your physician for her to review and use when she writes a letter of support.

Most ERISA-governed long term disability policies include a limitation on the amount of time they will pay benefits when the disabling condition is one that the policy defines as a “mental/nervous” condition.  Policies vary as to what they include in their definition of “mental/nervous” conditions and the wording of the limitation varies, too.  A note about the wording of the limitation – it is extremely important how the policy words the limitation in terms of how evidence of a condition such as depression or anxiety is presented in a claim.

Generally, the limitation is 24 months of benefits will be paid if the claimant is disabled by a mental/nervous condition such as depression or anxiety. There are conditions, such as Multiple Sclerosis, Parkinson’s Disease, migraines, and disability after heart attack to name a few, that either have depression as a symptom of the disease itself, and/or result in depression from dealing with the disease.  In such cases, you may not be disabled at all by depression but if it is mentioned in your medical records – and it very likely will be – very often an insurance company will seize upon the depression and attempt to apply the policy’s 24-month benefit limitation to your claim.

If your only disabling condition is a mental/nervous condition, and your policy contains a 24-month limitation, it may also contain a 12-month extension of benefits should you be hospitalized for your mental health condition at the end of the 24-month period.  These are highly technical exceptions that often require the assistance of attorneys who understand how these exceptions are applied.

World-Mental-Health-Day-300x300
Thursday, October 10 is World Mental Health Day. First celebrated in 1992, the day was set up by the World Federation for Mental Health to educate and raise awareness of mental health issues for people around the world.

Each year the event has a different theme. Suicide prevention is the primary focus for the 2019 theme for World Mental Health Day. Here are some key facts and figures about suicide from the World Health Organization:

  • Suicides are preventable.

As we continue to learn about efforts to challenge proton therapy denials by groups such as the Proton Therapy Law Coalition, the fundamental question becomes: Will the insurers actually get the message and change their ways? A recent article suggests that even when a jury awards a large punitive damages figure against a health insurer, the carrier is likely not truly getting the message.

In November 2018, an Oklahoma jury returned a $25.5 million verdict against Aetna for improperly denying coverage for proton beam therapy, a treatment the company considered experimental. In the largest verdict for bad faith in U.S. history, the jury found that Aetna “recklessly disregarded its duty to deal fairly and act in good faith” and awarded punitive damages. During the course of deliberations, the jury specifically discussed “sending a message” to Aetna and “making a statement” so Aetna would reevaluate how it handles appeals and requests for coverage.

However, many large insurance companies, if state allows them to, carry their own liability insurance for just this occasion. It appears that about 20 states do not allow insurers to carry such liability coverage. But insurers are now turning to products sold by offshore insurers beyond the reach of state regulators. In other words, a lot of insurers are not directly paying for the punitive damages awarded against them. This undermines the importance and impact of large jury verdicts on effectuating changed insurer practices.

Breast-Cancer-Awareness
According to the Centers for Disease Control and Prevention (“CDC”), breast cancer is the second most common cancer among women in the United States.

  • In 2019, an estimated 268,600 new cases of invasive breast cancer will be diagnosed in women in the U.S. as well as 62,930 new cases of non-invasive (in situ) breast cancer.
  • Men also get breast cancer, but it is not very common. Less than 1% of breast cancers occur in men.

If you have a condition such as migraine headaches, vertigo, or chronic pain, a condition that cannot be captured by “objective diagnostic measures” such as X-rays, MRIs, PET scans, etc., you still need evidence to prove to the insurer that you are disabled.

While letters from your physician describing your symptoms, their impact on your ability to function at work, and the underlying case are helpful as are the office notes from your doctor, we find that daily logs are very helpful. Logs, kept over a period of weeks or months, paint an ongoing picture of the number of times you are suffering from your disabling condition.

In the log, you must be sure to mark down the date, the type of symptom you are experiencing, e,g, – a migraine headache – the quality of the pain, the strength of the pain, and the duration of the pain. Over the course of several months, these logs can really help support a disability claim when they show a person is suffering from 3 or 4 migraines per week and the headaches are lasting for hours or days at a time. These logs are quite compelling when they complement the medical records.

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