How to Appeal a Denial of Long-Term Disability Benefits

What Should You Do if an Insurance Company Denies Your Claim for Long-Term Disability Benefits?

Suffering from a long-term disability can be an incredibly challenging and life-altering experience. Thankfully, many employer’s offer individuals long-term disability (LTD) insurance benefit to provide financial support during these difficult times. In some cases, these plans may provide initial benefits to persons who are not immediately eligible for Social Security Disability Benefits.


Understanding Long-Term Disability Policies and ERISA:

If your LTD plan is issued through your employer, the policy most likely is governed by the Employee Retirement Income Security Act (ERISA), which can present a unique set of challenges. ERISA is a federal law that establishes minimum standards for retirement, health, and other welfare benefit plans offered by employers. ERISA also impacts the rules and regulations surrounding your claim process and subsequent appeals. ERISA provides protection for both the plan participants and the insurance companies, aiming to ensure fairness in the administration of benefits.


ERISA imposes certain requirements on insurance companies, such as providing participants with plan information, a clear explanation of the claim denial, and a fair appeals process. However, it also sets deadlines and limitations on the claimant’s ability to present evidence, making the claim process complex and challenging to navigate without a proper understanding of it’s procedure. Importantly, ERISA mandates that claimants must exhaust an insurance company’s internal appeals process before pursuing any legal action. Your first objective should be to familiarize yourself with the specific requirements and deadlines for submitting an appeal, which are usually spelled out at the end of the denial letter. While plans may vary, in most cases you have only 180 days to submit your initial denial appeal. However, filing an immediate appeal also can be a mistake. You must use this 180 day window to properly develop an appeal if you are to expect a different result. For this reason, you should contact an attorney immediately after receiving the denial letter.


Steps to Take if Your Long-Term Disability Claim Is Denied:

1. Carefully read the denial letter from the insurance company, as it should outline the reasons for the denial and the procedures for submitting an appeal. Understanding the insurance company’s rationale is crucial in preparing your appeal. For example, did they rely upon the opinion of an outside medical consultant or did they just not receive all of your medical information in a timely manner?

2. Request a copy of the insurer’s file, including any adverse medical opinions upon which they relied to deny your claim.

3. Collect all relevant medical records, test results, and other evidence that support your disability claim.

4. Consult with your healthcare providers to ensure you have a comprehensive and up-to-date record of your condition. If the insurance company lists the opinion of an outside medical consultant, ask your own provider whether they agree or disagree with those conclusions. Your doctor’s can play a crucial role in responding to a denial, but a short letter stating you are disabled may not be sufficient. It is important to ask the right questions.

5. Eventually, you must submit an appeal letter that addresses the reasons for the denial and provides additional evidence to support your disability claim. Prior to sending in your appeal, consider seeking assistance from an experienced attorney who specializes in disability and ERISA claims.

6. In cases where all other options have been exhausted, filing a lawsuit may be the final course of action. Understand that ERISA lawsuits usually are limited to a review of the administrative record. Do not assume that you will be able to introduce new and additional evidence to a neutral jury, which is why the proper development of the initial administrative appeal is often the key to a successful claim.

New Virginia Law Permits Leave for Organ and Bone Marrow Donors

Beginning July 1, 2023, Virginia Law will include a new provision for employee leave for the purpose of organ or bone marrow donation. Pending Va. Code Section 40.1-33.8 allows for up to 60 days of unpaid business leave for employees for the purpose of organ donation and up to 30 days of unpaid leave for the purpose of bone marrow donation. However, not every employee will qualify. The new statute is structured similarly to the qualifying elements of FMLA leave. An eligible employee must have been employed for 12 months and worked at least 1,250 hours during the previous 12 months. Also, qualifying employers only include those with 50 or more employees.

Like the FMLA, during qualifying periods of leave, the employer must consider the employee as continuously employed and must reinstate the employee to the same or equivalent position upon their timely return. Retaliation is specifically prohibited for exercising these rights, but the statute does not contain an express provision for an individual cause of action. As structured, violations can be asserted to the Commissioner or the Virginia Department of Labor and Industry within 1 year. VDOLI is then responsible for investigating the claim and if warranted, issuing a notice of any founded violation, which primarily would include civil penalties.

SSDI: What Is My Last Insured Date?

When applying for Social Security Disability benefits, your “last insured date” is a key factor that initially dictates whether you are eligible to apply for benefits. The last insured date is the date on which your eligibility for Social Security Disability Insurance (SSDI) benefits ends. When you apply for SSDI benefits, the Social Security Administration (SSA) will look at your work history to determine your last insured date. To receive SSDI benefits, you must prove that your disability onset date occurred before your last insured date.

To be eligible for SSDI benefits, you must have earned a predetermined number of quarterly work quarters. Once you have earned enough credits to qualify for SSDI, you become “insured” for disability benefits. To earn credit for a work quarter, an individual must have earned a minimum amount of money during that quarter. For example, the amount of earnings required for a quarter of coverage in 2023 is $1,640.

Generally, an individual over 31 years of age needs to have earned 40 work quarters in total. Also, 20 of the work quarters must have been earned in a 10 year look-back period immediately before the onset of your disability. (i.e. did you work in 20 of the past 40 quarters?). Based on this math, if you have not worked for more than 5 years (20 quarters) then you likely will no longer be insured for SSDI purposes. You still can apply for benefits, but you must prove that your disability began prior to the last insured date.

Younger individuals may be eligible with fewer work quarters. If you are under 24, you only need to earn 6 credits in the 3 year period before the onset of disability. If you are between ages 24 and 31, you need to earn credits for working half the quarters between age 21 and the onset of disability.

Based on these formulas, if you no longer are able to work due to a permanent disability, it is important to initiate your application for SSDI benefits in a timely manner.

Social Security Disability Benefits: Compassionate Allowances

Waiting for the Social Security Administration (SSA) to approve Social Security Disability Insurance (SSDI) benefits can be a frustrating process, even more so if you have life-threatening medical issues. Compassionate Allowances (CAL) can speed up the approval process for those with the most debilitating and terminal conditions. The amount of benefits available for a Compassionate Allowance is the same as the regular SSDI or SSI benefit, but the time frame for review and approval is significantly shortened.

The Social Security Administration (SSA) adopted compassionate allowances in response to complaints that the SSDI application procedure was too drawn-out and cumbersome. CAL identifies specific medical illnesses that are so serious that they unquestionably meet the SSA’s disability requirements. Currently, there are over 240 conditions on the Compassionate Allowances list, including various types of cancer, genetic disorders, and neurological disorders. The SSA adds new conditions intermittently. The current list can be found at https://www.ssa.gov/compassionateallowances/conditions.htm.

CAL provides much-needed financial support to those who are facing immense medical and financial challenges. For those facing terminal illnesses, the expedited approval process under CAL is intended to provide access to benefits during one’s lifetime.

To be considered for a Compassionate Allowance, the applicant should advise SSA of their qualifying medical condition when applying for benefits. SSA reviews the application and medical records to determine if the applicant meets the Compassionate Allowance criteria. If qualified, SSA will then expedite the Claimant’s application.

Will Your Children Receive Additional Benefits if You Qualify for Social Security Disability?

Social Security Disability Insurance (SSDI) provides financial assistance to individuals who have become disabled and are no longer able to work. If you become eligible for SSDI your dependent children also may also be eligible to receive additional family benefits based on your SSDI eligibility.

Your eligible child can be your biological child, adopted child, step-child or a dependent grandchild. To qualify, your child must be unmarried and either:

under the age of 18;

between the ages of 18 and 19 and still in high school; or

over the age of 18 and have a disability that started before the age of 22.

The amount of the dependent benefit is based on your own SSDI benefit amount. A child may receive up to 50% of your SSDI benefit. However, there is a limit to the amount of money in dependent benefits that can be paid out to any single family, which is known as the family maximum. The family maximum is typically between 150% and 180% of your SSDI benefit amount.

Normally, dependent benefits continue a child reaches age 18 (unless they also are disabled). However, if the child remains a full-time student, benefits may continue until the child graduates or until two months after the child becomes age 19, whichever is first.

Can you draw both SSDI and SSI Disability Benefits?

The two most common types of disability benefits in the United States are Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). While both programs are administered by the Social Security Administration (SSA), they have different eligibility requirements and provide different types of assistance.

One question that frequently arises is whether it is possible to receive both SSDI and SSI benefits at the same time. The answer is yes, but it is not common.

SSDI is a federal program that provides benefits to individuals who have worked and paid Social Security taxes for a qualified number of years but are now unable to work due to a disability. To be eligible for SSDI, a person must have a disability that is expected to last at least 12 months and prevent them from doing any substantial gainful activity. The amount of the monthly benefit is based on the person’s earnings and contributions over their working life.

SSI is a needs-based program that provides financial assistance to disabled individuals with limited income and resources. To be eligible for SSI, a person must have a disability that prevents them from doing any substantial gainful activity and meet strict household income and asset requirements.
If a person’s SSDI benefit falls below the federal maximum for SSI, they may be eligible to receive both benefits. This is known as “concurrent” SSDI/SSI benefits. However, it is important to note that receiving both SSDI and SSI benefits is not common. If a person is eligible for concurrent benefits, their SSI cannot exceed the federal benefit rate (FBR), which has been set at $914 for 2023. Accordingly, if someone’s SSDI payment falls below the FBR, they might qualify for additional SSI benefits up to that amount, provided they otherwise are eligible based on financial need requirements.

What is the difference between SSDI and SSI disability benefits?

The Social Security Administration (SSA) administers two types of disability benefit programs” Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). While both programs provide financial assistance to individuals with disabilities, they have different eligibility criteria and benefits.


Eligibility

The eligibility criteria for SSI and SSDI differ based on the applicant’s work history, income, and assets. SSDI benefits are available to individuals who have worked and paid Social Security taxes for a certain number of years. To qualify for SSDI, an applicant must have earned enough Social Security credits through their work history. The number of credits required depends on the applicant’s age at the time they became disabled. Generally, an applicant must have worked for at least five of the last ten years and earned a total of 20 quarterly credits to be eligible for SSDI. Your benefits are not limited by your assets or other household income.

For those individuals that lack work credits under SSDI, SSI benefits are available to persons with limited income and resources who are unable to work in any capacity due to a disability. Under SSI eligibility criteria, the SSA considers an applicant’s income and resources, including other household income, savings, investments, family contributions and property.


Benefits

The benefits provided by SSI and SSDI also differ. SSDI benefits are based on the applicant’s work history and the amount of Social Security taxes they have paid over time. The amount of the monthly benefit payment varies based on the applicant’s earnings history.


In contrast, SSI benefits are based on a maximum federal benefit rate. As of 2022, the SSI cap is $794 per month for an individual. However, the actual benefit payment amount may be reduced based on an applicant’s other household income and resources.

If you’re your application for benefits has been denied, it is important to consult with an experienced disability attorney to determine your appeal options. My offices offers free case evaluations for Virginia residents. Call 804-440-6557 to schedule an initial consultation.