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Disturbing Trend in Michigan: Disability Claims Approved And Then Abruptly Taken Away Within a Year
| Guest post by: Terry Cochran |
Article Overview: Insurance companies sell group policies that some courts have ruled provide little or no coverage. Congress approved ERISA to “protect” employees’ pensions but in doing so unwittingly gave disability insurance companies a free pass to play the game on a field that is not level. That practice has been challenged by a lawsuit against insurance giant UnumProvident (Unum) charging that the insurance carrier devised a scheme to illegally deny or terminate the long-term disability claims of thousands of people in violation of ERISA.
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Disturbing Trend in Michigan: Disability Claims Approved And Then Abruptly Taken Away Within a Year
By Terry Cochran
There is a
very disturbing trend going on in Michigan in which persons approved for a
long-term disability claim out of the blue six months later gets their benefits
cancelled by the insurance company. You can just imagine the havoc that causes
in that person’s life.
The reason is
that the Employee Retirement and Income Security Act of 1974 (ERISA) was rigged
by Congress and further rigged by the Courts to be strongly biased against in
favor of the insurance company paying Long Term Disability (LTD) benefits to an
individual.
Insurance
companies sell group policies that some courts have ruled provide little or no
coverage. Congress approved ERISA to “protect” employees’ pensions but in doing
so unwittingly gave disability insurance companies a free pass to play the game
on a field that is not level.
That practice
has been challenged by a lawsuit against insurance giant UnumProvident (Unum)
charging that the insurance carrier devised a scheme to illegally deny or
terminate the long-term disability claims of thousands of people in violation
of ERISA. The lawsuit charges that Unum cut costs by terminating claims by:
·
providing
financial incentives to in-house physicians who would rubber-stamp previously
made business decisions
·
authorizing
more senior in-house doctors to change the written reports of other
“uncooperative” in-house doctors in order to justify a claim denial or
termination
·
stopping
payments to policy holders without any explanation given for termination
In recent
settlements Unum has agreed to reconsider some 200,000 denied disability
claims. The company is facing a potential $145 million fine in Maine alone. And
this is only one insurance company; there are others engaged in the same kind
of deceptive practices.
The fact that
insurance companies without good reason are terminating LTD claims previously approved
is one more attack made to rob well-intentioned, honest citizens of the
benefits they have coming. I find this to be absolutely horrible. It is bad
enough that insurance companies, without good cause, will routinely deny
disability claims when first submitted and force applicants to appeal or
resubmit claims. This is a long-standing ruse of LTD insurance companies, and
it’s wrong!
Disabled
workers how are denied benefits must appeal not once but twice to the insurance
company, a process that takes at least six months and requires patients to
track down all their medical records and submit every document that they might
later want to use in a lawsuit. After a second denial, the insurer might send a
case for an “independent” medical review by a doctor chosen by the insurance
company.
ERISA law,
augmented by federal court rulings, does allow workers denied benefits to seek
a limited bench trial – a mere review of the administrative record, no new
evidence, no witnesses, no jury. But federal law only allows the plaintiff to
sue for the original benefits. There are no payments for damages or pain and
suffering.
One study of
576 lawsuits filed in federal court against the seven largest disability insurers
(MetLife, Unum, Prudential Financial Inc., CIGNA Corporation, Standard
Insurance Co. and Aetna Inc.) found that insurance companies:
·
Regularly
deny or terminate benefits to individuals even after they determined to be
disabled by the federal government and approved for Social Security Disability
payments.
·
Hire
contract doctors who routinely reject the opinion of treating physicians
without ever having seen the patients.
·
Provide
incentives to employees to deny and terminate claims, typing performance evaluations
to meeting money-saving goals.
·
Force
plaintiffs to wait two years and eight months on average form the time they are
disabled to the time their cases are resolved.
·
Face
no peril for repeatedly denying or terminating legitimate claims because federal
law does not allow for any damages.
Many of the
denials or terminations involve long-lasting illnesses that are hard to prove,
such as chronic pain, back problems, closed head injuries or fibromyalgia. But
some claims involve heart disease, blindness, migraines, or cancer – diseases
which are easier to establish.
The rush to
denial by insurance companies also is a practice followed for government
benefits such as SSD and SSI: Social Security denies almost 70 percent of its
initial disability claims while 60 percent of those who appeal eventually win.
Because the
deck is stacked against disability claimants form day one, and all through the
process, there is no question in my mind that the injured person early on in
the process should contact an attorney who specializes in personal injury
litigation, especially in the fields of long term disability and/or workman’s
comp. An applicant living in Michigan
who is denied LTD, SSD, SSI or workman’s comp needs an attorney from Michigan
because of how Michigan No Fault Law and other Michigan laws impact these
areas.
The permanently injured person soon learns that
the only ones looking after their best interests are themselves and their
attorney.
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