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When An Attorney is Not an Attorney and The Disability Insurance Application Process
While we all went to law school, we did not end up practicing the same types of law. A criminal defense lawyer is not the same as a personal lawyer or a divorce lawyer. You get it but not many disability insurance companies get it.
They like to use the ancient “Dictionary of Titles” to determine our occupation if we become disabled, and they try to cheat us out of residual disability benefits as we slow down our practice because of our disability and then finally stop the practice of law.
An attorney disability insurance claim poses specific challenges for both the disabled attorney and for the disability insurance company. Before you start limiting the nature of your practice, reduce the number of trials or cases you handle or even stop working, you must understand the 5 major issues that you will face at the application stage and get the assistance of Nancy Cavey, a nationwide ERISA disability and individual disability attorney.
The timing of your application, the occupational documentation, the medical documentation, and financial documentation are keys to getting your disability benefits. Be assured that your claim will be closely scrutinized because of the high-dollar exposure your claim poses to the disability insurance company’s bottom line.
There are five major issues which must be addressed at the outset, and most are policy and data-driven:
Get out your long term disability insurance policy or policies and look at the declaration sheet which outlines what occupation you insured at the time you took out the policy and then look at the policy definition of “occupation.”
Write that down. Then check the definition of “occupation” in your other policies. You might be surprised to find there are different definitions of “occupation” in each policy. You’ll have to satisfy the definition of “occupation” for each policy.
So, how does your policy define the term “occupation”?
For example, let’s say you are a trial lawyer, and you can no longer handle depositions, trial preparation, jury selection or the rigors of trial, but you can still sign up clients, draft pleadings and negotiate. What benefits are you entitled to collect?
I want to prove that you are totally disabled from being a trial lawyer so that you can collect total disability benefits and still practice law in some other capacity.
On the other hand, the disability insurance company wants to look at your billings and determine what percentage of your practice involved discovery, trial preparation, and trial and what percentage was spent signing up clients, drafting pleadings or attending mediations.
Based on those numbers, the disability insurance carrier wants to say that you weren’t really a trial lawyer when you became disabled and, if the policy allows, pay monthly partial or residual disability benefits based on your non-litigation earnings. Yes, that sounds stupid but that is how a disability carrier wants to parse your occupational duties.
Or worse yet, they will say “yes, you can’t be a personal injury trial lawyer, but you also handled workers’ compensation cases, and that is what you were at the time you became disabled.”
Really! You know this is all about the disability insurance companies’ money!
It is not unusual for the disability carrier to ask for your billings:
“To ensure that we have a complete understanding of your pre-disability work activities and any work activities you have done since the date of disability, please send us a list of billing codes that reflect your work/billing activity and your billing records for the last 2 years .”
That is a trap! It is not uncommon for billing activity to include the work of non-attorney staff which can color the determination of your occupation. I prefer to get the attorney’s billing data and do an analysis of what activities the attorney was doing at the time they became disabled and then cull t the billing activity of any staff.
I may also have to analyze the activity performed and type of cases handled both before and after the date of disability to prove not only your occupation but an inability to perform the material and substantial duties of your occupation.
So, what is your legal specialty?
Let’s say you are a personal injury attorney, workers’ compensation attorney, social security attorney or divorce attorney. The key occupational duty is being in trial, in court, in front of a judge or a jury.
But that might not be the complete answer in determining your occupation! Let’s say you are a probate attorney, a health care attorney or a securities attorney.
Board certification could be the key to identifying your occupation. I always want to point out what it takes to become certified. How many hours or different types of activities did it take to become certified? What did you have to prove to establish your competency and maintain your board certification?
So, it isn’t as simple as saying that you were a trial attorney when you became disabled. In fact, different carriers interpret data differently and come to completely different conclusions, premised on the desire to pay out as little as possible!
For example, let’s say you are an attorney who takes depositions, prepares for trial and tries cases but you also do mediation. Or you also do different types of law as part of your practice. As a result of a back injury, you can’t travel to attend a deposition or are up and down while doing a deposition but you can walk from room to room and mediate a case.
What is your occupation? A trial lawyer? A mediator? Something other than a trial lawyer? Well, Guardian will look at the number of trials you have had, the number of mediations you have done and what other areas of practice you are doing and say, “we won’t pay a total disability claim as a trial lawyer,” while Northwestern Mutual might pay benefits. That’s why it is important to read your policy closely and think this claim through.
I like to supply the disability carrier with other proof of my client’s occupation as I think is appropriate. That can include malpractice applications, malpractice renewal forms, CLE records, billing and appointment, and trial calendars. In fact, I hit them with a “shock and awe” application package that leaves no question about your occupation and the benefits you are owed,
So, now we know what your occupation is, the next issue is what is the definition of “disability” you must prove? There is no uniform definition of “disability,” so, once again, we must get out the policy. Let’s say the policy says that you are disabled if you can’t perform one or more of the substantial and material duties of your occupation as a trial lawyer.
Exactly what are your duties? Which duties are substantial? Which duties are material? Why can’t you perform those duties? Write out what you think you spend the bulk of your time on and what duties must you perform to do your work?
Now that we have established the definition of disability, do your medical records support an inability to perform the material and substantial duties of your occupation?
Probably not! Many attorneys do not communicate their symptoms or difficulties performing their duties for fear of a malpractice claim, being seen as a wimp or losing the physician as a referral source.
It is crucial that your medical records are developed to address these issues! I take the time to develop the medical records and correct any defects that might cause the disability carrier to claim that no reduction in your income is related to your disability.
Some policies provide that if you can’t perform some of the material and substantial duties of your occupation and you are losing at least 80% of your pre-disability wages every month, you are entitled to be paid residual disability benefits.
This can be the best of worlds for my attorney clients who still want to work but can’t perform all of their duties or who are not yet ready to stop practicing.
However, the carrier will want to establish your pre-disability earnings as a starting point to determine what duties you can’t perform and therefor your lost earnings. We want to pick the highest earnings possible.
Let’s start with a simple question.
When did your revenue start to go down and why? Write that down.
Now that we know that answer, let’s get the policy out and look at the definition of “residual disability” and “pre-disability” or “before monthly income.” This is the starting point of the math exercise because that number will be used to determine whether there have been any post-disability earnings that qualify you for residual benefits.
The next step is to determine the period of calculation for the pre-disability earnings. It can be the
Once we know the pre-disability earnings number, the next step is to determine the amount of loss required to be entitled to monthly residual benefits. In some cases, if your lost income is 80% or more of that pre-disability earnings number, you are entitled to full total disability benefits. This requires lots of calculations!
The math continues as we analyze each month’s income to determine the amount of any loss. Once those months are identified, it is back to the medical records to determine if the medical records, as they currently exist, support the claim and, if not, to develop those medical records.
The claimed periods of residual disability must be proven both from a financial, vocational and a medical standpoint or the residual claim will fail.
You’ll have to prove this every month in which you claim residual benefits. You will have to submit Profit and Loss statements and earnings information every month.
You’ll also need to be careful with any income attributed to the sale of practice assets, including the practice itself, equipment and buildings.
Sometimes it is easy to identify the date of total disability as the date of some catastrophic event, like an auto accident.
More often than not, when an attorney is eligible for both residual and total disability, we start with the residual claim. Over time, we generally come to a point where the professional isn’t making enough money to pay expenses, is asked to leave the practice or just can’t practice anymore.
What is crucial is the support of the treating medical providers and a willingness to complete Attending Physician Statement (APS) forms. If your providers don’t support your claim or aren’t willing to fill out forms, you need to find a new provider before you stop working and claim benefits. It is a simple as that!
It is crucial that this is coordinated before you make a mistake that will result in a claim’s denial.
Lots! The disability insurance application seems simple but it is deceptive. For example, you will be asked to fill out a form describing your occupation and asked to estimate the percentage of time you spent in the office, interviewing clients, drafting discovery, taking depositions, handling motions, attending mediation trial. If you answer these questions incorrectly, you can start a fight about your occupation, your duties and whether you can perform those duties.
That is why I analyze my client’s occupation, gather the documents that prove the occupation and give the carrier little or no reason to challenge my analysis. We want our data to prove the occupation, the pre-disability earnings number, the loss of earnings and the medical and vocational evidence to back this all up, before we file the claim for residual and/or total disability.
You also must produce your medical records. You’ve read medical records and you know that medical records rarely tell the story of why the attorney can’t perform the material and substantial duties of the occupation. Just as crucial is tying the disability to the loss of income with a vocational rehabilitation report.
I am also prepared to produce, in a “shock and awe” box, the following:
Your application can make or break your claim from the very beginning. You owe it to yourself to contact Nancy Cavey, before you change the nature of your practice, stop working or apply for benefits.
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