What Do the New Disability Claims Rules Mean to Claimants?

What Do the New Disability Claims Rules Mean to Claimants?

Disability Claims Rules
Disability Claims Rules for Early Retirement

Back in 2016, the Department of Labor created new regulations to change the disability benefits claims review process covered by the Employees Retirement Income Security Act (ERISA) of 1974. Although claimants expected these rule to take effect on January 1, 2018, due to a delay they did not take effect until April 1, 2018. If you have an ERISA plan, then you’ll want to know how these new rules could affect any future disability claim that you might file.

Why Implement New Disability Claims Rules

There’s a simple reason for these changes. Section 503 of the ERISA contains regulations provide detailed instructions concerning the claims process.  Instructions such as, notice requirements, timeframes, qualifications, notice content and more. As a result of these regulations, claims made under group health plans and disability plans now require higher standards.

When the Affordable Care Act (ACA) passed, group plan claims procedures experienced enhancements; however, disability plan procedures did not change.

Following these enhancements the Department of Labor decided to update the regulations concerning ERISA disability plans as well. Especially, after finding that most of ERISA’s plan litigation was the result of long-term disability claims.

The New Disability Claims Rules

ESRA-covered plans that provide disability benefits will need to make changes to the way disability benefits claims receive reviews and determinations. Which in turn could affect your ability to qualify for disability benefits. Changes made include:

  • Claim denials must include an explanation detailing the reason the plan disagreed with the Social Security Administration or health care professional’s view.
  • The claim denial must include a statement declaring that the claimant can request. They must also have reasonable access to all records, documents and other relevant information regarding the claim free of charge.
  • If the claim denial is a final internal denial, then a statement must be included. That statement must detail the right of the claimant to bring an action. The statement will also be required to include any contractual limitations periods. Limitation periods to include apply to the right to bring such an action.
  • Claim denials based on the claimant’s medical necessity or experimental treatment must have an explanation of the scientific. Or, clinical reason for denial or a statement offering to provide an explanation upon request.
  • Retroactively canceled coverage must fall under claim denials. Unless premiums or contributions towards the cost of coverage were not paid on time.
  • The decision to hire, terminate, promote or compensate individuals pertaining to a claim, such as a vocational expert or a claims adjustor, cannot take effect based on whether the plan thinks the individual will support the denial of a claim.
  • The claimant must receive notice for the rationale and any new or additional evidence used to determined benefits. This must occur before a claim appeal has been officially denied so that the claimant has time to respond.
  • Claim denials must include the specific internal rules, protocols, standards or guidelines used to deny the claim. Including, if a lack of such criteria was behind the denial.
  • The claimant has the right to proceed to litigation if the plan does not adhere to these new claim procedures.

These new changes will actually benefit claimants. Although, employers will need to make sure that all ERISA covered plans that provide disability benefits are in compliance. For more information on how these new disability claims rules could affect you, schedule a free consultation by calling Social Security Disability Advocates USA at (602) 952-3200.

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