Understanding Policy and Plan Language and Terminology

Welcome to Season 5, Episode 13 of Winning Isn't Easy. In this episode, we'll dive into the complicated topic of "Understanding Policy and Plan Language and Terminology."

Join attorney Nancy L. Cavey, a leading expert in disability claims, for an insightful discussion on the critical role that policy and plan language plays in your disability claim. From the meaning of “proof of claim” to unexpected travel restrictions, and even how unrealistic settlement expectations can sink your case, this episode is packed with real-world examples and legal insights. Learn why understanding the fine print of your ERISA plan could be the key to winning your benefits.

In this episode, we'll cover the following topics:

One - Do You Have to Provide Your Disability Carrier With Objective Evidence of Illness to Get Your ERISA Disability Benefits?

Two - Unrealistic Settlement Expectations Doom ERISA Mediation – “If My Wife Doesn’t Get 100% of the Full Value of Her Claim, I’m Going to Divorce Her.”

Three - Can I Travel Overseas and Collect My ERISA Disability Benefits?

Four - Why the Language in an ERISA Summary Plan Description and an Administrative Service Agreement Can Make All the Difference in How an ERISA Disability Claim Is Handled and by Whom

Whether you're a claimant, or simply seeking valuable insights into the disability claims landscape, this episode provides essential guidance to help you succeed in your journey. Don't miss it.


Listen to Our Sister Podcast:

We have a sister podcast - Winning Isn't Easy: Navigating Your Social Security Disability Claim. Give it a listen: https://wiessdpodcast.buzzsprout.com/


Resources Mentioned in This Episode:

LINK TO ROBBED OF YOUR PEACE OF MIND: https://mailchi.mp/caveylaw/ltd-robbed-of-your-piece-of-mind

LINK TO THE DISABILITY INSURANCE CLAIM SURVIVAL GUIDE FOR PROFESSIONALS: https://mailchi.mp/caveylaw/professionals-guide-to-ltd-benefits

FREE CONSULT LINK: https://caveylaw.com/contact-us/


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Need help with your Long-Term Disability or ERISA claim? Have questions? Please feel welcome to reach out to use for a FREE consultation. Just mention you listened to our podcast.

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Please remember that the content shared is for informational purposes only, and should not replace personalized legal advice or guidance from qualified professionals. 

Transcript

Nancy Cavey [00:00:00]:
 Foreign hey, I'm Nancy Cavey, national ERISA and individual disability attorney. Welcome to this week's episode of Winning Isn't Easy. Before we get started, I've got to give you a legal disclaimer. The Florida bar says I have to say this. This podcast is not legal advice. Now, once I've said this, nothing is ever going to prevent me from giving you an easy to understand overview of the disability insurance world, the games that disability carriers play, and what you need to know to get the disability benefits you deserve. So off we go. Now, today we're going to be diving deep into the language of disability policies and plans.
 
 Nancy Cavey [00:00:49]:
 We're often focused on the bigger picture, getting approved for benefits or filing an appeal that we overlook the fine print. And it's that fine print, the smallest details of your policy that can have a significant impact on the outcome of your claim. Whether you get the benefits, how long you get the benefits, whether the benefits are ultimately denied or your claim benefits are terminated. So I will tell you that when you're applying for benefits, when you are in the claims process, when you're in the appeals process, when you're litigating, the terms and language in your policy or plan are absolutely crucial. Understanding what's written in black and white can make the difference between a successful claim and a denied claim. In today's episode, we're going to walk through some of the various scenarios, some of which may seem minor or humorous at first glance, but will drastically impact how your claim is handled. And by the end of this podcast, I think you'll appreciate what why reading your policy carefully is one of the most important steps you can do when managing your disability claim. So let's get started and I want you to be prepared to navigate the complexities of a disability policy.
 
 Nancy Cavey [00:02:02]:
 So we're going to talk about four things today. We're going to first, talk about the policy, plan or provision that says you may have to provide your disability carrier plan with objective evidence of illness to get your risk of disability benefits. Number two, how a policy or plan language can impact a settlement and how in one case, unrealistic settlement expectations doomed the mediation. And it's a bit sad and humorous, a story that I'll tell Number three, can I travel overseas and collect my ERISA disability benefits? And number four, why the language in an ERISA summary plan description and an administrative service agreement can make all the difference in how an ERISA disability claim is handled and who gets to handle it. So got it. We're going to take a break and Come back to this episode. Remember, policy or plan terms can make all the difference. And even the smallest thing in a policy or a plan can make the difference between getting your benefits or getting your claim denied.
 
 Nancy Cavey [00:03:16]:
 Let's take a break. Welcome back to Winning Isn't Easy. Okay. Do you have to provide your disability carrier with objective medical evidence of an illness to get your risk of disability benefits? Now, you just may have thought that, hey, I'm disabled because of an illness or an injury and I should get my benefits. Well, that's not always the case. There are no uniform disability insurance policies or plans in the United States. And many disability insurance carriers or plans have multiple versions of their disability plans or policies. And the terms can differ significantly from policy to policy or plan to plan.
 
 Nancy Cavey [00:04:05]:
 So let me tell you a little story. This is the case of Zigler vs Sun Life Insurance Assurance, rather, of Canada. It's out of Missouri. Ms. Ziegler applied for her ERISA disability benefits after she was diagnosed with lupus and related autoimmune disorders following the birth of her child. Her doctors really assigned some very severe restrictions and limitations and supported her claim that she was unable to perform her own or any occupation. So she submitted her claims to Sun Life, and guess what? Her doctors disagreed with the restrictions and limitations assigned by her treating physicians. Of course, Sun Life denied the claim, and we end up in federal court.
 
 Nancy Cavey [00:04:45]:
 So what did the judge do? Well, the judge said, look, I want to examine the terms of the policy or the plan. What does it say about proof of claim? And there are proof of claim provisions in every policy or plan. And the plan required the following proof of claim. The proof of claim has to consist of at least the following. A description of the disability, the date the disability occurred, the cause of the disability. Proof of claim may include, but is not limited to, police accident reports, autopsy reports, laboratory tests, toxicology reports, hospital records, X ray reports, narrative reports, or other diagnostic testing material. As required, proof of claim must, must, must include evidence demonstrating the disability, including, but not limited to hospital records, physician records, X ray narrative reports, and other diagnostic testing materials as appropriate for the disabling medical condition. Now, in all that gobbledygook, did you ever hear the words objective medical evidence? No, but that was the basis of the denial.
 
 Nancy Cavey [00:05:58]:
 Sun Life's doctors disputed the diagnosis of lupus, citing a lack of a physical examination, findings and reports consistent with the diagnosis and the restrictions and limitations assigned by Zigler's treating physicians. So Zigler appealed, submitted new medical records, which still didn't address the objections raised by Sun Life's doctors, and she didn't undergo a functional capacity evaluation or other testing to determine the basis of her restrictions and limitations. Now, another key provision in the policy or plan is what we call the discretionary clause. The plan gave Sun Life the discretion to determine Zigler's entitlement to benefits, and the judge would use and will use that standard of review to uphold a denial. The judge noted that in some circumstances it's reasonable for the plan administrator to interpret the plan to require objectives evidence as proof as part of the proof and documentation that the claimant is required to submit. Now, proof is an ambiguous term. While the plan clearly outlined the requirements for proof, the judge found that despite the denial of this claim based on the lack of objective evidence, Zigler didn't prove that SunLife had abused its discretion by relying on his physician's opinions. I think this is flawed reasoning.
 
 Nancy Cavey [00:07:21]:
 The plan did not require objective evidence and Sun Life's rejection of the treating physician's opinion opinions based on the lack of objective evidence I think was flat out wrong. But I also think that the bigger issue was Zigler didn't provide the appropriate documentation of her diagnosis and adequate proof of disability. And it's incumbent upon you as the plan beneficiary or the policyholder to provide that very evidence. Now, I disagree with the judge's decision, but I understand the reasoning. What do you think? Let's take a break.
 
 Speaker B [00:07:57]:
 Have you been robbed of your peace of mind by your disability insurance carrier? You owe it to yourself to get a copy of Robbed of your peace of mind, which provides you with everything you need to know about the long term disability claims process. Request your free copy of the book@kvlaw.com today.
 
 Nancy Cavey [00:08:31]:
 Welcome back to Winning isn't Easy. Let's talk about how unrealistic settlement expectations because of a lack of understanding or willingness to believe what the policy or plan had to say can doom an ERISA mediation. And I call this that if my wife doesn't get 100% of the full value of her claim, I'm going to divorce her argument. Okay? Now, many ERISA disability policies have provisions in them that people don't necessarily appreciate, but ultimately they need to come to understand because the court is going to be looking at these provisions and deciding whether the denial or termination of benefits is correct. And just because you don't like them doesn't mean they're not applicable. So when I find what I find is that when many ERISA disability claims are denied or benefits are terminated, ultimately you may have to file a lawsuit in federal court to challenge this determination. Under the federal rules of procedure, we have to attend a mediation conference to resolve the legal issues in dispute, if we can. And because of the uncertainty of litigation and difficulty in overcoming a standard of review, which is a golden handcuff on judges, many cases will settle now.
 
 Nancy Cavey [00:09:52]:
 Carriers do not pay 100% of a claim. Never ever have I ever seen in my many years of practice that any carrier, be it a disability carrier, a personal engine, a personal injury claim, where the car insurance or the UM carrier, or even in a workers comp case, no body pays 100% of the value of a claim. Carriers and plans will evaluate their exposure based on the value of the benefits in dispute, the policy terms and, and sometimes even who the judge is. And as a result, in ERISA cases, policy, policy type or plan cases, cases will often settle for anywhere from 25 to 50% of the value of the claim. Is that fair? Heck no. But that is the reality. So let's talk about the impact of policy limitations on the value of a claim. Disability policies often contain limitations that impact how long benefits are going to be paid and for what conditions.
 
 Nancy Cavey [00:10:53]:
 Some policies or plans will have a mental nervous policy limitation, providing that a disability caused by psychological issues is limited to just two years of benefits. And there also might be another version of that, and that's what I call the Monty Python mental nervous policy limitation, which says, hey, if your disability has caused or contributed to ever so slightly, benefits are limited to just two years. Now, there are also subjective medical condition policy limitations or plan limitations. And what they'll say is that musculoskeletal disorders and certain subjective medical conditions like fibromyalgia or migraines can be limited to just two years. Now, these clauses, these subjective medical condition clauses come in different flavors too, which is why it's important that you're reading the policy or the plan so you understand what benefits you might be eligible for, how you go about developing the necessary medical proof and trying to insulate yourself against the application of the mental nervous policy limitation provisions or the subjective medical condition limitations. So let me give you an example. Let's assume that the policyholder or the plan beneficiary suffers from migraines, and the policy limits the payment of benefits to just two years based on the subjective nature of the condition. And without this limitation, the policyholder might be eligible for benefits until age 67.
 
 Nancy Cavey [00:12:22]:
 But once this limitation is in place, benefits are capped at two years. So get out a pad and a pencil or get out your phone here and just take notes because we're going to do some math. Let's say the monthly benefit is $5,000 over 24 months. The total benefits would be $120,000. Now, if the policy does not have the limitation, potentially based on the facts of this case, the total benefit could reach $600,000 by the age of 67. But under the terms of this policy or plan, benefits are capped at $120,000. There's no more. In a recent mediation, the policyholder's husband told the mediator and counsel that he would not allow his wife to settle for anything less than $600,000.
 
 Nancy Cavey [00:13:12]:
 He even went so far as to say that he would divorce her if she accepted anything less because he felt it wasn't fair to him because he had been paying all the bills for her to settle for less than the perceived value of the case. Did that case settle now? The carrier offered 100% of the value of the 24 months of benefits, the $120,000. The settlement offer was rejected. And ultimately, if this case proceeded, I am sure that a judge would rule against them and certainly the case would be zero, not $120,000. Having unrealistic expectations, even after clear explanations from counsel and the mediator meant that this case did not settle. And one can only presume that they're still married, but they certainly will have lost their ERISA policy, their ERISA claim, due to these policy limitations. These are things that are very important that you need to understand from the very beginning of your claim. The development of the medical evidence and the strategy that can potentially be employed to limit potentially the application of these types of policy terms or plan terms that will limit the period of benefits for certain medical conditions.
 
 Nancy Cavey [00:14:37]:
 Got it. Let's take a break. Welcome back to Winning Isn't Easy. Can I travel overseas and collect my ERISA disability benefits? Now, a common question we get is whether clients can travel outside the United States for leisure or to visit relatives while collecting ERISA disability benefits. The answer lies in the terms of your disability policy or plan. Some policies or plans will limit the amount of time you can be outside the country, specify what countries you can visit, and even restrict relocation to another country while receiving benefits. While courts have often ruled that international travel for family visits isn't inconsistent with disability, we strongly recommend reviewing your policy or plan before you make any long term travel plans and certainly before you decide to relocate abroad. So what should you consider? Well, even if your policy allows travel, I think we need to think a step ahead.
 
 Nancy Cavey [00:15:46]:
 Policies will generally require that you get appropriate medical treatment for your disabling medical condition. So your doctors are going to need to complete attending physician statement forms APS forms. Many foreign doctors are either unfamiliar with the forms, don't understand how to complete them, or fill them out in languages other than English. Disability carriers don't like that. Now alternatively, policies or plans require that you get appropriate and or reasonable medical treatment consistent with the nature of your condition. So I find that some of the treatment that is being offered by clients who are traveling or trying to relocate abroad isn't consistent with the policy terms or the plan terms. It's not appropriate or reasonable and certainly may not even be appropriate or reasonable consistent with the kind of treatment you got before you went on vacation or you relocated. So before you embark on long distance travel or relocation, I think you need to have your treating physician do updated APS forms so that those at least are submitted before you leave.
 
 Nancy Cavey [00:17:01]:
 You also should be identifying medical providers where you're going to make sure that they can provide appropriate treatment and that they are willing to complete the necessary attending physician statement forms. Otherwise, I have to tell clients you need to come back to the United States on regular intervals. If your records are written in a language other than English, we need to have them translated. We need to give them to your treating physician here in the United States. Give a really good interval history of what your symptoms and functionality are, including difficulties you've had traveling, and then ask your doctor to complete the APS forms here. That's a lot of money and a lot of work, but those are the kinds of things that you should be taking into consideration before you embark on international travel or relocation. Got it? Let's take a break.
 
 Speaker B [00:17:55]:
 Are you a professional with questions about your individual disability policy? You need the Disability Insurance Claim Survival Guide for Professionals. This book gives you a comprehensive understanding of your disability policy with tips and to dos that will assist you in submitting a winning disability application. This is one you don't want to miss. For the next 24 hours we are giving away free copies of the Disability Insurance Claim Survival Guide for Professionals. Order yours today@disabilityclaimsforprofessionals.com.
 
 Nancy Cavey [00:18:44]:
 Welcome back to Winning Isn't Easy. Why the language in an ERISA Summary Plan description at an Administrative Service agreement can make all the difference in how your ERISA disability claim is handled and by whom. Now you probably are confused by these terms summary plan description and administrative service agreements because they are not sort of commonly thrown around in the context of an ERISA disability claim other than maybe the spd, but certainly not the Administrative Service agreement. So this can be a confusing world to navigate, especially when it comes to understanding who's responsible for what and who ultimately makes the decision on your claim. An employer can or cannot offer employee benefits. They can offer short term benefits, they can offer long term benefits. So let's talk about the role your employer plays in this type of situation. Now you can have a situation where the employer is basically self administering a plan.
 
 Nancy Cavey [00:19:45]:
 That's called being self insured and self administered. So they decide who is owed the benefits, they'll interpret the terms of the plan and they'll also pay them. Or you have a situation where the employer has a plan but they hire a claims administrator to decide the claim and then they pay. They pay the benefits, not the claims administrator. Sedgwick is one well known claims administrator. Now an employer may decide, look, I'm going to offer short and long term disability benefits, but I don't want to be involved. I'm going to go out and contract with a company like Unum or Lincoln and they are going to decide our employees entitlement to benefits. I'm not going to have any input in it.
 
 Nancy Cavey [00:20:34]:
 And this disability carrier is going to pay the benefits. So what happens if your claim gets denied or benefits terminated? Who are you going to sue? The answer can be found in two places. And it's important for us lawyers because we need to understand who we're suing and where we're suing. The first place it can be found is in something called the summary plan description SPD or the Administrative Service Agreement ASA which is the agreement between the carrier and the claims administrator. So why is all of this important? Well, let me tell you the story of Shea in the case of Shea versus Unum Life. This is a case out of Massachusetts and Shea sued Unum, Massachusetts General Brigham and Massachusetts Massachusetts General Hospital Long Term Plan sued everybody. Unum said, hey wait a second, we want to be dismissed from this party, we got other things to do. Shea objected and said, look, I want Unum there.
 
 Nancy Cavey [00:21:37]:
 So ultimately the court has to decide. And the court looks at the summary plan description and looks at the servicing agreement. And under the plain language of both of these documents, the court found that the plan did not give Unum the discretion to determine entitlement to benefits or to interpret the plan terms. All Unum did was to act as the claims administrator since particularly Mass General Brigham had had the final authority to authorize payments. And as a result the court said Unum has no fiduciary duties and dismissed them from the litigation. Now, based on my experience from Unum, I think that was a happy thing and Shea had to deal with her employer's long term plan and not deal with Unum. But you can see that who got sued was decided based on the employer's arrangement. The way that the employer set up their short or long term disability plan, were they self insured, self administered? Were they self insured, administered by somebody else, or did they wash their hands of it and say we're going to let somebody else like Unum pay the benefits and make that determination to pay those benefits? It's in this instance, however, Unum was a plan administrator.
 
 Nancy Cavey [00:23:01]:
 Got it. If you have any questions about these kinds of issues, please don't be shy about contacting an experienced ERISA disability attorney. It's got to be sorted out. They're going to want the policy, they're going to want the plan. Potentially they're going to want the summary plan description and the servicing agreement before they'll be able to give you an answer and decide how they're going to go about filing the complaint against whom and where they're going to be doing that. Got it. So I know we've covered a lot of ground relating to understanding policies and plan language in terms from providing evidence in your disability claim to navigating unrealistic settlement expectations, and understanding the complexity of travel while collecting benefits. I hope you found this helpful.
 
 Nancy Cavey [00:23:50]:
 And again, please, if you have like our page, leave a review, share it with our family or friends, subscribe to our podcast. And by the way, we want you to note that at the beginning of every episode description, there's a link where you can send us questions. And we love questions. We might even feature your question in a episode in the future. Got it. All right, thanks for listening to our discussion about ERISA disability benefits policies and plans, and we hope you have a great day. Thanks.