Dual Occupation Defense and Physician Claims
Most physicians I know have multiple specialties or even have other businesses. If so, you must properly protect yourself in the event you become disabled because one of the common defenses to a Long Term Disability medical professional claim is the “dual occupation” defense. What is this defense?
The Long Term Disability insurance company will argue that you have two or more occupations at the time you became disabled. Because you are able to work full time in any one of those occupations, the Long Term Disability carrier will argue that you aren’t entitled to any benefits.
Let me give you some examples.
In Giampa vs. Trustmark Insurance Company, 73 F.Supp.2d 22 (D. Mass 1999), Dr. Giampa, a chiropractor, spent 85% to 95% of pre-injury patients by conducting examinations and performing manipulations or chiropractic adjustments. He injured his back, which limited his ability to perform manipulations. Dr. Giampa has spent incidental time managing two other chiropractic facilities before his injury.
After his injury, Dr. Giampa devoted all of his time to administrative duties, managing the other chiropractic facilities, which resulted in a dramatic increase in his income. He claimed Long Term Disability benefits, which of course were denied.
Dr. Giampa disability policy had both a total disability and a partial disability clause.
The federal court decided that the total disability clauses shouldn’t be read so literally and insured a person’s ability to perform some business duty, no matter how small, would prevent the finding of total disability.
In yet another twist on the dual occupation issue, a dentist had retired and began working in the real estate field. He became disabled and filed a claim asking for the payment of Long Term Disability benefits based on his inability to perform dentistry. The court found regardless if he intended it or not, even after the sale of his dental practice, dentistry wasn’t his regular occupation at the time he became disabled.
The un-controverted medical evidence shows that he was unable to perform the substantial and material duties of his regular occupation as a real estate developer. The clause in the disability policy defined total disability as the inability to perform “some substantial and material duties of his regular occupation”. The Long Term Disability policy didn’t require that he be unable to perform all the substantial and material duties of his occupation.
Another example involves a Long Term Disability policy of a general surgeon who on the side developed a second business doing cosmetic surgeries including vein stripping. Needless to say this was far less stressful and more remunerative than doing general surgery. Unfortunately, he became disabled and unable to perform general surgery. Was he entitled to Long Term Disability benefits?
The answer could be found in the terms of his disability policy. He had a policy that looked up the occupation he was engaged at the time of his disability and he also had a residual disability provision. The residual disability provision paid benefits even if he was working at another occupation.
The residual disability provision said that “residual disability must follow right after a period of total disability that lasts as long of the qualification period, if any.” Huh?
This would seem to say that one could ever get residual disability benefits unless there was initial period of total disability. Another question would be whether he would be entitled to total disability benefits from work as both a general surgeon and as a cosmetic surgeon to get benefits.
Another paragraph says that “this (residual disability benefit) will begin on either the commencement date or after the total disability ends up, whichever is later”. You could argue that if you were unable to do general surgery, but on the same day could do vein stripping, the doctor would be entitled to residual disability benefits.
As you can see there are significant choices to make, and you can inadvertently shoot yourself in the foot screwing up your eligibility for disability coverage by making the wrong decision about your own occupation, and the date of disability.
You must determine what your policy says about the criteria for being disabled, what occupation your policy covers, whether there is a residual claim, what percentage of your revenue comes from both your occupations, how your disability impacts your ability to perform both occupations and how you are going to prove that disability. That determination should be made before you even file your Long Term Disability claim.