An employee who becomes disabled while covered by an employer-sponsored disability plan may qualify for short-term disability (STD) benefits and then long-term disability (LTD) benefits, based on the length of the disability and the terms of the plan. However, some LTD policies require that the employee not only apply for STD, but “exhaust” it, meaning receive the maximum amount of benefits allowed under the policy, before they may pursue LTD. If an employee received all but one day of the full STD benefit, they may still have to go through the appeals process or risk eligibility for the more valuable LTD benefit.
Kantor & Kantor was recently retained by a client, who we will refer to as John Smith for anonymity. Mr. Smith was employed by a large corporation as a Material Handler who was responsible for all supplies and materials needed to manufacture medical devices. Unfortunately, he became disabled by degenerative disc disease and painful spondylosis of his lumbar spine. In addition, he suffered from sciatic nerve pain in his back. His painful conditions necessitated medications which also caused side effects and impacted his functioning.
Mr. Smith’s company’s disability plan claim involved the situation described above, except that his STD claim was terminated just a few weeks before he received the maximum duration of benefits. He unsuccessfully appealed his STD denial on his own before hiring the law firm. In evaluating his STD claim and his potential LTD claim, the attorneys identified the following language in his LTD policy:
For the first 12 months after the Elimination Period you are Disabled for LTD Plan purposes when Prudential determines:
- you are unable to perform the Material and Substantial Duties of your Regular Occupation due to your Sickness or Injury; and
- you are under the Regular Care of a Doctor;
- you have received 26 weeks of continuous payments under the STD Plan sponsored by the Company; and
- you have a 20% or more loss in your Monthly Earnings due to that Sickness or Injury.
The first step in getting Mr. Smith’s LTD benefits was to get his STD denial reversed. The STD plan administrator accepted a second appeal, which the firm prepared and submitted on his behalf. The appeal included obtaining medical and other evidence showing how Mr. Smith was unable to do his job as a result of his medical conditions. The firm was not only successful in getting his STD appeal approved without the need for filing a lawsuit, it also got his LTD claim approved.
If you have a denied STD benefit claim but have a continuing disability, it is important to consult with a knowledgeable ERISA attorney about whether you need to appeal the STD denial before you can apply for LTD benefits. You may want to write off the remaining STD benefit if there is not much left but doing so could be to the detriment of your LTD claim. This type of scenario is not the norm, but it is important to understand the terms of the policy and the next steps that may be taken before you miss a deadline to appeal.
For a free consultation about any disability insurance issues you may be experiencing, please call Kantor & Kantor at 800-446-7529 or use our online contact form.