Long Term Disability (LTD) Denial? Explained By a St. Louis Long Term Disability Attorney
Unfortunately insurance companies don’t always do the right thing.
In fact, in the area of long term disability insurance there has been a sad history of insurance companies acting in bad faith in denying claims. This happens at a time when someone is sick and has lost their income from their occupation. Add to that a poor judicial process to review the insurance companies’ decisions; giving the insurance company the benefit of the doubt in most cases and you create a perfect storm for the insurance company to try to “buy” you out of your policy by taking advantage of a stressful situation.
The key to this problem is to not cower to their threats and to document your claim with a view towards litigation, says a St. Louis long term disability attorney.
What to Do?
1. Know what type of policy you have.
“ERISA” policy vs. Private Disability Policy — This is crucial! What type of policy you have generally determines your remedies and whether you must sue in state court or federal court. This affects whether you can have a jury trial, receive punitive damages, what scrutiny the insurance company receives, and essentially how your claim is treated and valued by the insurance company. The short and rough rule is this: If your employer provides the LTD benefit, then it usually is an “ERISA” policy; if you obtained the policy and paid for it by yourself, it is most likely a private disability policy. If given the choice, usually you don’t want an ERISA policy; you want to have a private disability policy which gives you the right to sue in a state court and the remedies that provides. Keep that in mind when making the decision to purchase disability insurance. If at all possible, purchase the policy yourself without any entanglement with your employer. Go get your own policy!
Short-Term Disability — Usually these benefits are paid by your employer and at full salary. You still need to be found “disabled” under the policy’s definition of disability, but it is for a short duration. Typically, short-term disability lasts for 6 months or 180 days, but you need to check your policy to make sure what you have. Usually you have to go through short-term disability benefits before you can receive long-term disability benefits. Be aware that the same information you provide for your short-term disability benefit claim is used for your long-term benefit claim.
Long-Term Disability — Most LTD policies kick in after a period of time. Typically this is the 6-month period when short term benefits are running. Here are the big items you want to look for in your policy:
- “Definition of Disability” — See how they define “totally disabled.” Typically it’s whether you can perform the duties of your own occupation for the first year or two, and then unable to work any occupation after that. They will have their own legal verbiage, but most of the important terms should be defined in the policy.
- Pre-existing Condition Exclusion — This is very important. Most policies exclude pre-existing conditions so you can’t just sign up for disability insurance once you find out your sick. But, also understand that most pre-existing condition exclusions don’t run for eternity. Usually there is period of time after you become insured where if you file a claim the pre-existing condition exclusion is triggered. For example, a lot of policies use a 1 year or 2 year period whereby they will review your medical records for a pre-existing condition if you file a claim within that time. There is also a look-back period that runs prior to being insured. A policy might have a 3-month or 6-month look back from the date of insurance for pre-existing conditions. If you are thinking about filing for short-term and/or long-term disability benefits, make sure the pre-existing condition exclusion is not an issue. If you can hang on for a few extra months until the waiting period expires you can possibly save yourself a lot of headaches and problems with the pre-existing condition exclusion clause.
- Benefit Amount — Look to see what amount of money you’ll receive if you are found disabled. Typically it is either a percentage of your salary (e.g., 60%) or a stated flat amount (e.g. $10,000 per month).
- Benefit Duration — If you are found disabled, how long will it last? Look to see if there is a minimum amount of years (e.g. 5 years) that the policy will last. Will it last until you reach 65? These terms will be spelled out in the policy.
- Mental Disability vs. Physical Disability — Most policies now treat mental disabilities differently than physical disabilities. Often you’ll see a limited duration (e.g. 2 years or 24 months) for mental disabilities. This leads to a potential trap. If you have both a physical impairment and a mental impairment, which one are you disabled from? Insurance companies will try to frame it as a mental disability to limit you to a short duration. Often they will try to get you to sign something which states that you agree that you are disabled from a mental condition and therefore subject to a shorter duration. If you don’t think your mental disability primarily keeps you from working, then make sure you are not found disabled from a mental condition! You are limiting the duration you can receive benefits.
- Benefit Offsets — This is the one most people are shocked to find out about when they are approved for benefits. Most policies include language that enables the insurance company to reduce the amount of money they’ll pay to you by other income you receive from certain sources. The big one is usually Social Security disability benefits. It can also include workers’ compensation payments, insurance settlements, other disability insurance benefits, and even sick leave. It is important to review your policy so you can understand what reduces their payout.
2. Discuss your problems with your doctor
The first thing you need to do is make sure your doctors know that you have applied for short-term and long-term benefits and that they should be receiving paperwork from the insurance company regarding their opinion on your condition and what limitations you might have. It is important that you communicate to your doctor your problems and symptoms. Doctors are very busy and have many patients. It is very difficult for them to remember everything about your symptoms. It is important that it is communicated to them and then written down in your medical records. For example, you may have a bad back and have a MRI showing degeneration and other problems that would likely produce pain and other symptoms, but unless you communicate these problems to your doctor and he knows how severe your pain is and what it keeps you from doing, then it is very difficult for him to give an accurate opinion.
3. Get things in writing
If it’s not in writing, it didn’t happen. Don’t count on the good graces of the insurance company. And don’t assume your doctors or employers have filled everything out to everyone’s satisfaction. Make sure all forms sent out to you, your employer, and your doctors are completed and are accurate. It wouldn’t hurt to ask these people to send you a copy before they send them back to the insurance company. That way you can discuss with them anything that is incorrect or not fully detailed. Remember, in most of these cases the judge is simply reviewing the claims file. Once it is in writing it is set in stone and the insurance company can use those words as a basis of denial.
4. Don’t miss deadlines
Usually you need to make a claim within a certain period of time from stopping work (e.g. 90 days). Also, if your claim is initially denied, there is a deadline to appeal. If the policy is governed by ERISA, then the appeal deadline is 180 days. If it is a private LTD policy not governed by ERISA then the date can be different but often they use 180 days for that deadline as well. You must follow the policy demands exactly. If you miss a deadline then usually your claim dies right there.
5. If denied, get your appeal in order
If you are denied initially, you will have to request an internal appeal with the insurance company. It’s not really an “appeal” as you usually think of it; it is more of a review by the insurance company. More importantly it gives you a second chance to get everything you want in the file. If you are thinking about hiring a St. Louis long term disability attorney, this is a good time to do it. Since most of these cases are decided by just what is in the claims file then you must make your case in writing before the insurance company makes their final decision. If it’s not in there by that time, then it is unlikely that a judge will ever get to see anything else which you might like to add. If needed, an attorney should explore doing the following things:
- Add to the record relevant documents, medical records, medical journal articles, claimant statements, third-party statements, etc. which demonstrate your position;
- Obtain a Vocational Expert Opinion (a Jobs Expert);
- Obtain a Medical Expert Opinion (usually someone else than your treating physician);
- Obtain a Vocational Rehabilitation expert opinion; and
- Make written arguments and demands to the insurance company.
6. Most importantly, don’t give up
Only you know how you really feel. Only you know the level of effort you exert and how much you want to work. We see a lot of these claims. It usually becomes evident over time whether someone is truly in a bad way or is simply looking for an easy way out. Unfortunately, all too often the people who are truly in a bad way give up and those looking for an easy way out will keep on trying with nothing to lose. We want to represent people who are truly in a bad way. We realize that when you don’t feel well and finances are tough the last thing you want to deal with is bureaucratic red tape and insurance company shenanigans. Our advice is simply this — if the insurance company’s actions don’t pass the sniff test, don’t give up!
Please fill out the free claim evaluation form and we’ll contact you about your case.
David M. Hicks, P.C.
St. Louis, Missouri office
Two City Place Dr., 2nd Floor
St. Louis, Missouri 63141
Tel: (314) 812-4885
Fax: (314) 812-2550
Alton, Illinois office
528 Henry Street
Alton, Illinois 62062
Tel: (618) 343-0901
Fax: (618) 301-3360