Over the past 15 years, I have represented hundreds of claimants in their claims for disability benefits governed by the Employee Retirement Income Security Act of 1974, also known as ERISA. If an ERISA disability claim is denied, a claimant must appeal that denial to the plan administrator or insurance company before he or she is able to file a lawsuit. The appeals process is referred to as exhausting administrative remedies (though there is no administrative agency involved). The ERISA Regulations provide rules that an administrator must follow in order to give a claimant a “full and fair review.” See ERISA § 503; 29 CFR § 2560.503-1 (Claims procedure).
Effective April 1, 2018, the ERISA Regulations were changed to require that an insurance company or administrator provide to the claimant copies of new evidence it obtains after a claimant submits an appeal so that the claimant has an opportunity to respond to the new evidence before the insurance company issues a final claim decision. Some insurance companies, however, refuse to provide this evidence to claimants who filed their disability claims before April 1, 2018.
What if you fall into this pre-April 1, 2018 category? Do you have any rights to know what the insurance company is relying on before it issues a final decision on your appeal?
We believe that you do, especially if you reside within the Ninth Circuit Court of Appeals, which covers California, Nevada, Arizona, Alaska, Hawaii, Oregon, Idaho, Washington, and Montana. The Ninth Circuit issued a decision called Salomaa v. Honda Long Term Disability Plan, 642 F.3d 666 (9th Cir. 2011), where the Court explained that the defendant disability plan failed to conform to the ERISA claims procedures when it did not give Salomaa, a long-term disability claimant, access to the two medical reports of its own physicians upon which it relied to deny Salomaa’s appeal. This decision was issued prior to the 2018 change in the ERISA Regulations.
Recently, the Ninth Circuit issued an unpublished decision in Wagenstein v. Cigna Life Ins. Co., 2020 WL 68394 (9th Cir. Jan. 7, 2020), a case involving a disability claim terminated in April 2017. Wagenstein appealed the termination of her claim to Cigna. Cigna reviewed her appeal and then sent her an opinion by an examining physician who concluded Wagenstein could sit for 2.5 hours per workday. This opinion clearly supported disability since an employee who cannot sit for more than four hours in an eight-hour workday cannot perform sedentary work that requires sitting most of the time. But, in its formal denial of Wagenstein’s appeal, Cigna for the first time identified an opinion from a reviewing doctor who said Wagenstein could sit for up to eight hours per workday. Cigna also got an opinion from its vocational specialist who determined that Wagenstein could perform sedentary work. Cigna failed to disclose the new doctor report to Wagenstein until the day it denied her appeal. The Court held this violated ERISA’s regulations and denied her a fair review procedure. Wagenstein should have had the opportunity to submit additional evidence to respond to the doctor’s opinions. Because the district court declined to consider letters from Wagenstein’s treating physicians addressing the doctor’s conclusions, the Court found that this was reversable error and remanded the case to the district court to consider Wagenstein’s rebuttal evidence.
In a recent district court decision outside of the Ninth Circuit, the court came to a similar conclusion. In McConnell v. Amer. Gen. Life Ins. Co., 2020 WL 292193 (S.D. Ala. Jan. 21, 2020), the district court determined that American General violated the ERISA Regulations when it failed to provide McConnell with documentation it generated after McConnell submitted his appeal and before American General issued a final decision. The insurance company’s actions resulted in evidence being used against McConnell which he had no opportunity to rebut. Defendant claimed that it had no obligation under the ERISA Regulations to provide McConnell with the new evidence because his claim was filed before April 1, 2018. The court was not persuaded by this argument. As a consequence to American General’s actions, the court stated it will apply de novo review to the case, meaning that American General’s decision will not get deferential treatment.
If you have appealed a denied ERISA disability benefit claim, it’s important that you request all new evidence the insurance company generates after the submission of your appeal. This is so you can respond to the new allegations and ensure your claim is adequately supported. It’s also important to consult with an attorney prior to submitting your appeal. Kantor & Kantor, LLP’s team of ERISA attorneys are knowledgeable about appeals and what evidence you must submit to be successful. Please call Kantor & Kantor for a free consultation at 888-569-6013 or use our online contact form.