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Thursday, February 14, 2013

The importance of meeting deadlines for appealing the denial of long-term disability employment fringe benefit claims

If you have received a claim denial from your employer’s insurance company (ERISA plan), it is imperative that you appeal that denial in a timely manner.  If you do not challenge the insurance company’s denial, that will create problems down the line. There are different time periods for appealing denial of health insurance, long-term disability insurance, and severance fringe benefits.  These plans are subject to a federal law known as  ERISA.

Fringe benefits you receive from your employer (health insurance, long-term disability, and severance) are subject to these federal regulations.  If you receive a denial of benefits, the federal regulations provide for distinct deadlines for appeals and the deadlines are different depending on the type of fringe benefit.  
The appeals for:
 Severance Benefits are governed by 29 C.F.R. § 2560.503-1(h)(2)(I); 
 Long-Term Disability Benefits, are governed by 29 C.F.R. § 2560.503-1(h)(4);  
Pension Benefits are governed  29 C.F.R. § 2560.503-1(h)(2)(I);
Health Insurance are governed 29 C.F.R. § 2560.503-1(h)(3)(I);
Life Insurance are governed 29 C.F.R. § 2560.503-1(h)(2)(I). 
Keep in mind several pointers when you receive a claim denial for any of these types of benefits:
  • The time deadlines are counted beginning on the date you receive the denial, rather than when the claim denial is mailed to you. This is true as of the date of this post, however, federal regulations could change how the time deadlines are counted. It is important and necessary to check the federal regulations in effect at the time you receive the denial to see if they have changed.
  •  Long-term disability appeals, when undertaken properly, are complex, extensively time-intensive endeavors, hence the long appeal period. You will need all of the time allowed to perfect your appeal. As such, it is important to start working on your appeal immediately after receiving the denial.  
  • If you find yourself precariously close to the appeal deadline, there is nothing in federal law which prohibits you from contacting the individual who signed the denial to request an extension. But beware, nothing requires the insurance company or administrator to grant the extension and you should not count on being granted an extension.   But we have requested extensions on behalf of participants who come to this law office as a deadline was approaching, and many of those requests have been granted. 
The ERISA law on long-term disability fringe benefits and other employment fringe benefits is subject to change at any time,  but the following chart list is a guideline only. Keep in mind these deadlines could be changed by federal ERISA law at any point in time after this chart is posted. 
Severance Benefits 60 days 29 C.F.R. § 2560.503-1(h)(2)(I)
Long-Term Disability 180 days 29 C.F.R. § 2560.503-1(h)(4)
Pension Benefits 60 days 29 C.F.R. § 2560.503-1(h)(2)(I)
Health Insurance 180 days 29 C.F.R. § 2560.503-1(h)(3)(I)
Life Insurance 60 days 29 C.F.R. § 2560.503-1(h)(2)(I)
The U.S. Department of Labor (“DOL”) publishes a summary guide for fringe benefit claims and appeals. 
It is extremely important that one keep in mind that the DOL guide is geared toward health insurance claims, denials of which are appealable within 180 days of denial.
However, caution! Claimants and Appellees are frequently misled when viewing the DOL guide site and are lulled into a false sense that they have a longer time to appeal than they actually do have as for Life Insurance claims, pension benefit claims, and severance benefit claims, which each only have a 60 day appeal deadline. Many claimants miss the deadlines because they erroneously believe they have 180 days to appeal.
It is always best to start the appeal immediately once the claim has been denied and not wait even one week. Done properly, these appeals are a complex procedure.


Contact Hope A. Lang, Attorney at Law, today for a free consultation.

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