The Most Frequently Asked Questions about Disability:
There are some topics I am asked about more often than others.
Although there is not enough room on these pages to answer every
question completely, please feel free to contact me if you need
additional information.
Is my disability insurer permitted to reduce my benefit for
my Social Security Disability (SSDI) award?
This issue does not generally come up for Individual Disability
claims because the reduction in benefit is not written into IDI
policies. However, for group (ERISA) LTD policies, there is most
often a contractual provision which allows the offset from your
monthly benefit. Check your policy carefully to determine if
your insurance company is allowed to reduce your benefit.
However, a recent Supreme Court case questions whether or not
ERISA policy provisions can be enforced. If your claim is
governed by ERISA, you may be able to avoid offset contract
provisions. In the case of Great West v. Knudson, 534 U.S.
204(2002)found that a reimbursement provision in an ERISA plan
cannot be enforced. This means the Plan Administrator cannot sue
you to enorce a reimbursement provision under ERISA. Although
this case is very complex, it basically says ERISA does not
authorize an insurer to seek monetary damages under the remedy
provision of the statute. Currently, there are some rulings
from the federal courts claiming the provisions for repayment
from Social Security Disability benefits are unenforceable while
other rulings say they can be enforced. It is always a good idea
to find out what the law is in your jurisdiction to determine
whether it is necessary to contact an attorney to fight paying
back the alleged overpayment. Of course, if you are currently
receiving benefits, your disability insurer will reduce your
monthly benefit to $0 in order to recover the overpayment. But,
if your benefits have already been terminated, it's important to
consider your options. Consult an experienced attorney in your
state to find out what your options are. Do I have to turn
over my social security lump sum award to the insurance company?
In general, yes. If you received a lump sum payment from Social
Security for the same period of time you received unreduced
benefits from your disability insurer, then you MUST repay the
insurance company since you were overpaid in previous months.
Social Security must be allowed as an offset first, before the
insurance company can require you to repay the lump sum from
Social Security.What do I do if I receive a denial letter
from my disability insurer terminating my benefits?
If you have a group LTD ERISA claim you must follow the
directions given to you carefully in the denial letter you
received. You have 180 days from the date of the letter to
inform the insurance company you intend to appeal the denial
decision.If you have an IDI claim, you should immediately
gather all medical information from all sources not previously
reviewed by the insurance company, and send it along with a
cover letter requesting a reconsideration of the denial
decision. A consultant or other trusted resource will be an
invaluable resource to you since the ERISA laws are very clear
about how to appeal claim denial decisions. Must I attend an
Independent Medical Exam if requested to do so?
Most of the time, yes. You should always check your policy to
determine if your submission to an IME is required. Many
insurance companies are now putting language in the LTD contacts
which compels claimants to “cooperate” with the insurance
company. If the insurance company feels you are not cooperating,
they could terminate benefits for refusing to show up for the
medical evaluation.It is extremely important to be prepared
for an IME in advance. Preparation of a personal folder and
other documents is an excellent idea. Your consultant will be
able to assist you, but basically being prepared for an IME can
make the difference between keeping your benefits or losing
them. What information will the insurance company be able to
obtain about me?
With your signed authorization, the insurance company can obtain
records for: loans, mortgages, bankruptcies, credit history,
marriages, divorces, adoptions, employment history, motor
vehicle report, arrests, military records, court orders, liens,
police records, all medical, dental, and hospital records,
welfare and human services records, information from neighbors,
professional licenses and complaints, insurance or malpractice
records, air travel hours redeemed, country club or physical gym
memberships, golf dates and times, incorporation records, better
business bureau records, records subject to the Freedom of
Information Act, on-line chats, on-line websites, FICA payments,
mental health records, and records from other insurance
companies including social security, and workers’ compensation.
And, this is just the short-list.Can the insurance company
conduct surveillance?
Yes. This is another area where a qualified consultant will be
able to help you recognize the signs of investigative
surveillance and help you understand how this information will
be used to potentially terminate your benefits. Insurance
companies cannot deny your benefits solely on what they are able
to film on a CD. Insurance company procedures are often abused
in the area of surveillance
If you have any ideas about questions you feel are
frequently asked and you would like to include them on this
page, please feel free to email me with the question and I will
be happy to include it. I like to think of this page as
“evolving”, so please don’t hesitate to let me know what
questions you feel are important.
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