Must You File an Appeal of Your Denied Long-Term Disability Claim or Can You Just File a Lawsuit?
The answer is “Yes,” you must file an appeal first before you file a lawsuit.
Fighting your long-term disability carrier can be exhausting. Delay, endless requests for more information, not so “independent” a “medical evaluation,” surveillance and denial, are all designed to wear you out. You might be tempted to say “nuts” to that and just file a lawsuit in court.
Unfortunately, that can destroy your case.
What Are Your Obligations to File an Appeal of a Denied Long Term Disability Claim?
Every disability policy or plan has a requirement that an appeal of a denied claim be filed before suing to get the disability benefits you deserve.
Under ERISA regulations, the disability insurance company or plan must provide a reasonable claims procedure. There must be adequate notice of the claim denial that will enable the policy holder to file an appeal within the 180-day administrative appeal deadline.
The denial letter must provide adequate notice in writing to any participant or beneficiary whose claim for benefits under the plan has been denied, setting forth the specific reasons for such denial, and written in such a way that the participant or policy holder can understand the reason for the denial.
If the notice is not given or is not adequate, then the appeal process does not begin to run. On the other hand, if the insurance carrier has complied with ERISA regulations, you must complete or “exhaust” the appeal process before you can take the carrier or plan to court.
Let’s see how this works out in real life.
The Number One and Easiest Defense for a Disability Insurance Carrier, is the Failure of the Claimant to Exhaust Remedies
“Exhausting Remedies”means going through the appeal process before filing suit. This is no joke. Look at what happened to a claimant named White.
In the case of White v. Anthem Life Ins. Co., 2020 WL 6158308 (9th. Cir. Oct. 21, 2020), Ms. White got a letter from Anthem that did not determine “whether [she] was entitled to benefits,” nor did it “deny, reduce, or terminate” her benefits. Her lawyer responded, but absent any actions by Anthem that would have been the equivalent of a denial, such as the suspension of her benefits, the attorney had nothing substantive to respond to.
The court found that the attorney’s letter did not constitute an appeal of a denial, since the claim had not actually been denied.
When Anthem finally did deny Ms. White’s claim, White did not appeal the denial but filed a suit in court. Her lawyer should, when Anthem denied her claim, have guided her through the appeal process before filing suit in court. This case ultimately went to the Ninth Circuit, which held that it was “undisputed that the plan required her to appeal and exhaust her administrative remedies.”
So, as soon as she filed that suit, Anthem filed a Motion for Summary Judgment asking the court to dismiss the claim on the basis that White had failed to exhaust her administrative remedies. The court agreed and threw out the lawsuit. Ms. White lost her case because she did not file an appeal of the denial before she filed a lawsuit.
You have to go through the appeals process before you sue, even if the carrier’s response to your case seems confusing.
Don’t give the disability carrier or plan an easy win!
Regardless of how exhausting the application and claim process might be, you are legally required to file an appeal before you go to court. The failure to do so timely or to file an appeal at all gives the disability carrier an easy win because the federal law is clear. If you don’t exhaust your administrative remedies by filing an appeal, the carrier will file a motion to dismiss and the court will grant that motion.
Your impatience and frustration will destroy your claim.
Call me at 727-894-3188 to learn more about your rights to your long-term disability benefits and how and when to file an appeal. Don’t delay! Call today.