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The United States District Court for the Eastern District of Michigan has held that an insurer must advise a long-term disability claimant of its internal appeal requirement within the actual plan document in order to establish a failure to exhaust defense.

In Wallace v. Beaumont Healthcare Employee Welfare Benefit Plan, No. 16-cv-10625 (E.D. Mich. January 18, 2017), Reliance-Standard Life Insurance Company moved to dismiss the plaintiff’s complaint on the basis that she failed to exhaust her internal administrative remedies prior to filing suit.  The court denied the motion, holding, in part, that Reliance Standard had not included an appeal requirement within the express terms of its disability insurance contract. A statement advising of a right to appeal a denied claim in a letter is insufficient to secure a dismissal, according to the court. The court cited the opinion of another federal court in Montoya v. Reliance Standard Life Ins. Co., No. 14-cv-02740 (N.D. Cal. Mar. 2, 2015) which also found Reliance Standard’s long-term disability form contract lacking any requirement of an internal appeal. The Wallace court held:

Having reviewed the Reliance policy, which Plaintiff attached to her Amended Complaint, this Court finds no discussion of an exhaustion requirement. The only requirement for bringing a legal action set forth in the policy reads: “No legal action may be brought against us to recover on this Policy within sixty (60) days after written proof of loss has been given as required by this Policy.” The policy does not incorporate the terms of any other document. To the contrary, it expressly states that the policy represents “the entire contract.” Nevertheless, even if this Court construed the denial of benefits letter as a plan document, it would hold that the letter did not mandate exhaustion as a prerequisite to bringing suit.

 

The court’s ruling in Wallace underscores the importance of carefully reviewing a claimant’s long-term disability contract for a disability insurer’s own compliance with ERISA when an exhaustion defense is raised.  The court’s ruling also increases access to disabled employees whose claims for disability benefits have been wrongfully denied or terminated.

J.J. Conway has been named a 2017 “Top Lawyer” by dbusiness magazine in its annual Top Lawyers Issue.  According to dbusiness magazine, “For our 2017 Top Lawyers peer review survey, we polled 19,000 attorneys in Wayne, Oakland, Macomb, Washtenaw, and Livingston counties. Each attorney was asked to nominate lawyers among 48 legal specialties.  More information about the peer reviewing rating process may be found by visiting the magazine’s website, dbusiness.

J.J. Conway Law is an employee benefits law firm representing clients in the matters involving ERISA, pension, long-term disability insurance, healthcare, life insurance, as well as other benefits matters. Based on Royal Oak, Michigan, the firm represents clients throughout the United States in ERISA and employee benefits matters, including complex benefit class action cases.

How would you describe your typical client?

Our clientele is quite diverse.  We represent as broad a range of clients as you can imagine. Since our litigation practice focuses on employee benefits — like disability insurance disputes – we serve people of all ages and backgrounds. Presently, we are handling the disability insurance claims of everyone from line-workers  to senior management of corporations. We represent managers, nurses, clerical support, and just about every occupation you can imagine. We also represent executives and professionals such lawyers, doctors, nurses, and college professors who have had health issues and problems with their disability insurance contracts.

Who is your success rate in disability insurance cases?

We enjoy a high percentage of cases resolved to our clients’ satisfaction. We want our clients satisfied. “Client satisfaction” is the standard by which we measure our success.  Sometimes this means achieving a courtroom victory. Sometimes, it means helping achieve a fair settlement.

Our success level is attributable to two primary factors.  First, our cases are directly affected by level of preparation devoted to them.  Most litigation cases do settle. The difference in settlement values is based on the level of preparation. The more preparation time spent on a case, the better the result.

The second factor is based on our singular focus on winning the case. We have heard successful college basketball coaches use an expression that pretty much sums up our litigation philosophy, we “hate losing more than we enjoy winning.” We have returned millions of dollars to our clients through judgments, verdict, and settlements. This was based on preparation, hard work, and a dedication and knowing the case inside and out.

Is there something to which you attribute your success?  Can you provide some examples?

First, we listen.  When we speak, we try to ask the right questions. Second, we are totally accessible to our clients thanks to the state of technology today. All email messages and telephone calls are returned in a day.  We try to educate our clients about the law, what it says, and what it means to their case.  We firmly believe that a client should never be in doubt as to where their case stands.  We insure this by emailing  copies of all documents filed or received in a given case.  We prepare regular email messages with updates on settlement talks. The clients receive their own copies of court rulings in their cases.

What may a client expect if you take the case?

In its most basic form, the legal relationship is a partnership. That is why I like that our firm’s motto is “conquer tomorrow.” We need to achieve our future desired result together.  We do ask that clients be involved in the process by supplying us with timely documentation and evidence gathering.  When the client is involved, the case tends to be more a more fulfilling experience.  We would never presume to know the facts better than our clients. Our clients will notice that we will be constantly rechecking or confirming of facts to make sure we have it right. . .every time.

Do most cases really settle?

Yes.  It is a reality in law that both sides typically want to control the outcome and not leave a major legal claim to chance.  The problem is we never know which cases will settle and which cases will not.  Take the case of DeLisle v. Sun Life.   In our view, Ms. DeLisle had an extremely strong claim against her insurer for ERISA disability benefits.  This insurance company, however, fought her claims before two different federal judges, losing before both judges.  The company then appealed the decision to the Sixth Circuit Court of Appeals, and having lost there, asked the entire Court of Appeals to overturn the case which it refused to do. In the process the insurance company hired two different huge law firms to fight this claim.  Delisle took seven seven years.  Who could have imagined this? And, yet in another case, the claim could be paid in 45 days.  The only way to firmly address this reality is prepare every case as if it is going to judgment. There is no substitute for this level of preparation.

Can individuals file administrative appeals on their own?

The short answer is ‘yes.’ The answer should be ‘no.’ While an individual may file his or her own ERISA or LTD appeal, they should be represented by legal counsel.  The reason is that, if a lawsuit is eventually filed, the lawsuit is about appeal.  The court case will focus on the contents of the appeal.  So, whether it is with our firm or another law firm, we believe an administrative appeal should be prepared by legal counsel.

What evidence is needed for a successful appeal?

The medical file is obviously the most important evidence. There is also other information, expert reports, vocational assessments, and the proper presentation of administrative agency decisions, such as Social Security.  The appeal should address, directly, the reasons the claim was denied in the first place.

What is the standard fee charged to your clients for their representation?  Is the fee the same for everyone?

Each case is customized based on the needs, goals, and objectives of the client. We are a people-centered firm which happens to practice law. That means we look at the situation the same way we would wish to be treated if we needed professional services.

Let’s break this down a bit further.

In the typical case, we are able to estimate what the damages might be.  A client who is unable to work because of their health may need to have the legal services rendered on a contingency-fee basis.  This is sometimes called the “no-win, no-fee” arrangement. In these cases, the firm is paid an agreed upon percentage of any financial recovery based a judgment, settlement, or the securing of a monthly benefit.On the other hand, a client who is able to afford the case on an hourly basis may look at the damages and see that paying by the hour is more suitable.   Either way, we strive to make it work for the client.

What distinguishes you from other law firms practicing in the area of disability insurance?

I think we bring a unique set of skills to a case that other firms may not possess.  First, my personal litigation background in law is rooted in complex commercial litigation and employment law. With this background training, I have been able to see the overlap among employment, employee benefits and contract law. I was trained in the commercial litigation context.  Given my background in employment law, I learned about the different occupational demands of positions in the workplace – often because the cases required a precise analysis of job duties. These three areas  come together in disability contract and ERISA disability cases.

What do you expect of your clients?

Two things in every case.  Honesty and patience.  We need to know everything, completely and honestly at the beginning.   We also need to ask for a bit of patience.  The legal process can be challenging, but in the end, if we keep pushing, we usually end up in the right place.

J.J. Conway has been named a 2016 SuperLawyer by Thomson Reuters.  J.J. has been listed as SuperLawyer or SuperLawyer Rising Star on nine occasions. SuperLawyers is a “rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer-recognition and professional achievement.” The selection process “includes independent research, peer nominations, and peer evaluations.” www.superlawyers.com.

For more information and to view J.J.’s Superlawyer profile, please visit:
J.J. Conway’s SuperLawyer Profile.

J.J. Conway Law is an employee benefits law firm representing clients in the matters involving ERISA, pension, long-term disability insurance, healthcare, life insurance, as well as other benefits matters. Based on Royal Oak, Michigan, the firm represents clients throughout the United States in ERISA and employee benefits matters, including complex benefit class action cases.

What is ERISA?

“ERISA” is an acronym standing for the Employee Retirement Income Security Act of 1974 which went into effect on January 1, 1975. The statute was designed to protect employee pensions and other employee benefits. 29 U.S.C. §1001 et seq.

The statute changed the landscape of employee benefits law by requiring that all benefit plans be regulated by the federal statute instead the laws of the 50 states. ERISA is comprised of four titles: Title I regulates the dissemination of information to the plan participants. Title II covers the tax laws related to employee benefits. Title III covers the administrative and legal enforcement provision of ERISA. Title IV created the Pension Benefit Guaranty Company (PBGC), an insurance program that provides insurance coverage for certain types of pension plans acts somewhat like the FDIC, or Federal Deposit Insurance Corporation.

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J.J. Conway has been named a 2015 SuperLawyer by Thomson Reuters.  J.J. has been listed as SuperLawyer or SuperLawyer Rising Star on eight occasions. SuperLawyers is a “rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer-recognition and professional achievement.” The selection process “includes independent research, peer nominations, and peer evaluations.” www.superlawyers.com.

For more information and to view J.J.’s Superlawyer profile, please visit:
J.J. Conway’s SuperLawyer Profile.

J.J. Conway Law is an employee benefits law firm representing clients in the matters involving ERISA, pension, long-term disability insurance, healthcare, life insurance, as well as other benefits matters. Based on Royal Oak, Michigan, the firm represents clients throughout the United States in ERISA and employee benefits matters.

In celebration of its sixteenth year of service to the public, J.J. Conway Law announced that the firm has received trademark approval for its motto, “Conquer Tomorrow.” The United States Patent and Trademark Office awarded the firm trademark protection for exclusive use of the words, “Conquer Tomorrow.” The firm’s motto will now bear the ® trademark symbol.

J.J. Conway, the firm’s owner, stated, “We are so grateful to the wonderful creative professionals and intellectual property counsel who helped us with this process. The words ‘Conquer Tomorrow’ represent the aspirational approach to law for which our firm stands. We want to be there with our clients every step of the way as we solve their legal concerns, moving together from place of challenge to a future of hope.” Conway added, “The creative team was so helpful and our legal counsel so dedicated, we cannot thank them enough for what they have done for our practice.”

J.J. Conway Law is an employee benefits law firm representing clients in the matters involving ERISA, pension, long-term disability insurance, healthcare, life insurance, as well as other benefits matters. Based on Royal Oak, Michigan, the firm represents clients throughout the United States in ERISA and employee benefits matters.

Years ago when our firm was in need of the services in a business transaction, we met in an office with a professional, and he outlined everything that needed to be done. He was thorough, and the process seemed like it would take a considerable amount of time.  At the end, I asked him what the entire project would likely cost.  Since he was going to be compensated on an hourly basis and was not sure of the actual amount of time required, he replied, ‘They are professional services.  No one wants to pay for them.  But, we will be fair.’

Implicit in his words was the acknowledgment that for most people, professional services are an unbudgeted expense.  Naturally, that worries people.  This is especially true for persons who are experiencing a legal problem with their disability insurer.  At the same time they are addressing a health issue, they are now required to seek out legal services.

After two decades of law practice, we have come to understand the costs inherent in pursuing an ERISA disability case.  Although, litigation can always lead to unexpected detours, the costs of an ERISA disability case can often times be estimated. Typically, a rough estimate of legal services from the filing of the claim to the completion of a case can be provided to a client.

From there, three different financing options are available to clients.  First, legal fees may be paid hourly and invoiced on a regular basis explaining the work that has occurred to advance the case.  Second, legal fees can be “contingent.” This means that rather than paying an hourly fee, a percentage of the benefit may be paid to compensate for the legal work performed.  A contingent-fee has the advantage of protecting a claimant against further losses, since a fee is only charged if the case is won or settled.  Third, a fee may be financed over time with various options available to the client.  Each case is different.  Each need is different.  Customized fee arrangements are available to address the individual needs of each client.

We have all been there at some point in our lives.

A promise is made. A promise is broken. We feel cheated, and maybe even a little hurt. When you feel that you operate from a place of honesty, and others do not, the entire experience can be disillusioning.

In their simplest form, disability insurance contracts are promises.

In several years of assisting clients with their disability insurance claims, I have made a few observations that I would like to share.

Our clients are responsible. Our clients work hard. They made choices about their financial future they believed were correct. They played by the rules.

It is not you. It is the insurers. Insurers change the rules. It has almost become part of their normal operating procedures. Often times, that is why an insurance company’s sales department is separated from its claims department. Promises made by one part of the organization may be more easily broken by another part of the company. Here, the law serves a purpose. The law is here to hold insurers accountable. Nothing more. Nothing less, either.

Disability insurance cases involve two of the most emotional issues that many of us will ever face. Disability insurance cases involve the intersection of health and finances. Our firm understands this, and we approach these cases with this firmly in mind.

Below are a list of our guiding principles:

Total Investment. Our approach is spend considerable time at the outset, getting to know our clients and the individual facts of their case. While we are selective in the number and types of cases that we litigate at any one time, this is because once we sign on, we are fully invested.

Winning Your Case. We strive win cases. We cannot guarantee legal outcomes, of course, because a host of different factors may affect a case’s outcome. That fact does not change our focus. We want to win on the quality of our written and public presentations. We routinely face huge law firms with plenty of resources and armies of lawyers. We want our presentations to win because we are on the right side of the issues and the law. We are committed to submit quality presentations on behalf of our clients. Every time. No exceptions.

Individualized Service. We strive to provide the individual level of client service that our clients have come to expect of us through the years. We are in constant communication with our clients.   We return all phone calls and email messages within one day. We are proud of our courtroom record, and we regularly review the hundreds of letters that we’ve received from satisfied clients to keep us focused on our commitment. Most of these inspiring letters say the same thing — what was promised in the beginning is what was delivered at the end. You should know, as our clients have attested, that once we sign on, there is no hand-wringing.

We are with you.

That is our commitment to you.

We look forward to serving you.

Copyright 2015 by J.J. Conway. All rights reserved.

about_pic1@1xInsurance companies can make the processing of a long-term disability claim unimaginably difficult. When a disability insurance company issues a written denial, its reasoning can seem insulting, insensitive, even callous. Litigation is always available as a means of holding difficult disability insurance companies accountable.  However, it is often more effective to take active measures in order to preserve a disability claim that has already been approved.  Here are a few suggestions for keeping your ERISA disability insurance claim in ‘approved’ status:

1. ‘Name’ Your Disability. A disability claimant, particularly someone who has struggled with several medical conditions, may want to claim all medical conditions as the cause of an inability to work. Sometimes, this is true. Still, listing multiple medical conditions provides an insurer with a unique opportunity to deny or terminate a disability claim. An insurer may question whether the medical evidence on each individual medical condition is, itself, disabling. When an insurance company employs such an approach, its denial letter will be lengthy and cite multiple reasons why each specific condition is not disabling. The insurance company may view each medical condition separately, rather than as contributing to the overall medical condition.

In the ERISA disability claims process, a claimant’s medical condition is properly viewed in terms of primary and secondary causes of medical disability. Such an approach focuses a disability claim. This approach allows an employee to explain the precise cause of an inability to work. If a claimant lists ten (10) different medical conditions as the primary cause of  disability, the claim becomes unfocused. This does not mean that medical conditions should be omitted from claims forms and requests for medical records. Not at all. All medical conditions are relevant and should be listed.  It does mean, however, that the claimant should be able to succinctly articulate the  medical condition or conditions which primarily cause an inability to work on either a full or part-time basis.

2. Know and Understand the Definition of ‘Disability’ or ‘Disabled.’  ERISA group disability insurance contracts tend to be form documents with similar definitions and coverage structures. A typical group disability contract promises to provide income replacement benefits to an insured participant who is unable to work because if illness or injury.  Additionally, whenever a claim is reviewed, a claimant should know the applicable standard for the continued receipt of disability benefits.  A disability contract may provide insurance for a claimant’s inability to perform his or her “own occupation” or “regular occupation.” A contract may also provide  insurance coverage for the inability to perform “any occupation.” A contract may provide some combination of both coverage standards.

For example, a contract may insure a participant for up to 24 months for the inability to perform his or her own occupation, after which the participant may be required to provide proof that a sickness or injury precludes that participant from performing any occupation for which he or she has the necessary skill set.  When responding to a review, it is important to know which definition or standard the insurance company will be using to evaluate the claim. Usually, the insurer will advise a claimant of the standard they will be applying when the claim is placed into review.  A claimant should be familiar with the applicable definition of disability and be evaluated by treating medical providers in light of what is required by that definition.

3.  Correctly Complete the Attending Physician Statement. Long-term disability claims are based in large measure on the submission of record evidence and the preparation of claims forms. The typical forms used in ERISA claims include (1) an employee statement of disability, (2) an employer work history statement, (3) an authorization for the release of medical records, and (4) an attending physician statement.

Sometimes referred to as an “APS,” the attending physician statement is a key document in a disability claim. In it, a physician (or sometimes multiple physicians or healthcare providers) identifies the claimant, the claimant’s medical condition, dates of treatment, and dates of claimed disability.  The “APS” inquires about restrictions or limitations and asks the medical provider to evaluate the physical abilities of the claimant to perform functions such as sitting, standing, walking, and the like on an hourly basis.

Standardized “APS” forms are notoriously ambiguous.  For example, a standardized “APS” form may inquire whether the claimant is mentally able to work. A treating physician in the area of internal medicine may not be familiar with a claimant’s mental status, and may fail to complete the section or, worse, inadvertently state that the claimant is not disabled.  Another common mistake is failing to read the forms correctly. All physical tasks should be viewed in the context of full workweek abilities, unless otherwise stated.  Sometimes, the forms inquire about the ability to perform certain functions over a 24-hour period.  “APS” forms should be read and completed with great care and attention to detail.

4. Treat Regularly With Doctors Who Regularly Treat Disabled Patients. A strong corollary of submitting a properly completed “APS” form is to treat regularly with physicians and providers who understand occupational disabilities. “APS” forms take time to complete.  Some busy physicians refuse to properly complete them. Since a disability claim may span years, or even decades, it is important to treat regularly with a physician or health provider that is experienced in treating patients with chronic conditions and who understand that paperwork might be required.  A claimant should recognize that medical insurers will typically not cover the cost of preparing any administrative forms and should inquire about and be willing to pay for the administrative cost of completing these crucial forms. Physicians should not be expected to work for free when using their expertise to assess disability.

Regular and continuous medical treatment is equally important.  When a disability claimant is notified that a claim is being placed in internal review, the claimant will often immediately schedule a doctor’s appointment.  Although innocent enough, if there is a lengthy treatment gap, the insurer may take the position that the medical appointment was merely to secure a supportive statement, instead of actual medical care. A claimant does not need to over-treat, but regular appointments, follow-up appointments, and documented medical care are critical to establish long-term, chronic conditions.

5. Document All Limitations and Restrictions.  The medical basis for disability claims is based on proof of functional limitations and medically necessary physical and mental work restrictions.  Over time, a chronic condition may result in the discovery of new and different physical limitations.  A claimant should bring these to the attention of a physician as soon as they are discovered.  This is important for three reasons.  One, the medical care may need to be changed based on a newly discovered physical limitation.  Two, the reporting and verifying of new limitations may indicate the worsening, rather than the improvement of one’s overall health.  Third, a medical record reported in “real time” is less likely to be challenged as opposed to a claimant disclosing new limitations after the claim in placed into administrative review.

6. Seek Objective Testing Where Possible.  Insurance companies are increasingly demanding “objective” proof or evidence of limitations or disability, even in cases involving mental health. Some ERISA disability plans now require “objective proof” of disability as a precursor for being approved.  Objective proof is ordinarily considered MRI, CT-Scans, EEG, EKG, blood chemistry panels, and other methods of objectively verifiable diagnostic testing.  In cases involving physical disabilities, a functional capacities evaluation (“FCE”) should be considered. In cases involving cognitive disabilities, a comprehensive neuropsychological examination should be considered.  Even if the particular tests are not covered by insurance, a claimant may want to schedule them anyway and pay for them directly as they will greatly assist proving continued disability during a claim review.

7. Document Activities of Daily Living and How Those Activities Have Changed.  A disability claim usually follows a similar path.  There is a “before and after” quality to the claimant’s lifestyle.  A busy lifestyle and robust social life can be replaced with a quieter and less active life coping with the loss of functionality and pain.  Sports activities, community activities and travel can all be reduced dramatically.  This does not mean it will always be so.  Individuals coping with chronic illness do find ways to be productive, seeing relatives and friends, and participate in some outside activities. Initially, and usually for some prolonged period of time, a claimant’s former lifestyle is altered considerably as a result of medical disability.  It is important to document all such non-occupational changes.

8. Do Not Believe That Once Approved, Always Approved.  When an insurance company approves a claim, it typically does so only for a fixed period of time, 90 days, six months, or one year at a time.  An insurance company conducting a review will almost always request updated medical records.  A claimant should keep a running  folder or binder of all medical records for all treatments even after a claim is approved and should review them for accuracy.  The records, themselves, will provide a useful medical history when a claim is reviewed. Up-to-date, accurate, and complete medical records will increase the odds of a claim remaining approved. Additionally, if an insurer requests in-person visit or interview or requires that a claimant undergo an in-person examination, it may be time to consider hiring an attorney experienced in disability claims.  These actions signify that an ERISA disability claim may be on a litigation footing.

9. Be Cautious About Online Postings and Public Appearances.  A disability claimant’s most frequent contact with the larger world is, like most others, through use of the computer.  Online accounts and social media have become ubiquitous and inexpensive.  Anything a person does can be publicized to the world right as it happens from a phone, tablet, or portable computer.  The risk inherent with social media postings for a disability claimant should be apparent.  A posting, even an innocent posting, which is at odds with claims of total disability can and will be used against a claimant.  Therefore, the public broadcasting of one’s activities through social media, particularly the posting of attendance at personal outings and events is discouraged. (For more on this subject, please see An Online ‘Friend’ You May Not ‘Like’).

10. Watch Out for Surveillance.  Few things in an ERISA long-term disability claim are as unsettling as a claimant realizing that the insurance company has ordered surveillance.  Worse, in ERISA disability cases, the films tend to be heavily and selectively edited since the surveillance videographers cannot be subpoenaed.  Disability claimants cannot prevent intrusive surveillance, but can protect themselves with a few pointers.   First, determine whether your insurance company relies on surveillance filming.  Liberty Mutual and Sedgwick CMS are currently disability companies which rely heavily on the use of surveillance in disability claims.  Second, note that surveillance is not (typically) conducted as 365-days-a-year program.   It is expensive.  Insurance companies tend to use surveillance around the time they request updated medical claims forms and new medical record authorizations.  Third, be vigilant.  Take notice if a strange vehicle begins appearing on the street, or a vehicle is occupied.   Surveillance companies tend to conduct full day observations.   Most start as early as 7 a.m. or watch a person over multiple days or over a weekend.  The good news is that there is usually an end date.

(c) 2015 by JJ Conway. All rights reserved.