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.