If you purchased a long term disability policy through your employer, your long term disability policy may be governed by the Employer Retirement Income Security Act (ERISA).
If you’re a long term disability policy holder whose benefits have been denied, you can challenge that denial in a federal court. However, you or your lawyer’s rights to conduct discovery and take the deposition of a claims adjuster, peer review doctors or others is generally limited.
Why’s Discovery limited?
The fundamental goal of ERISA is to provide a “method for workers and beneficiaries to resolve disputes over benefits inexpensively and expeditiously.” Accord Semien v. Life Ins. Co. of N. Am., 436 F.3d 805, 815 (7th Cir. 2006). Consequently, discovery is often limited in an ERISA case. Discovery beyond the administrative record (the carrier’s file) is generally inappropriate depending on the court’s applicable standard of review.
What’s the standard of review?
A denial of ERISA benefits is reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan. Firestone Tire & Rubber Co. V. Bruch, 489 U.S. 101, 115 (1989).
However, when the challenged plan grants the administrator discretionary authority under the applicable standard of review is “arbitrary and capricious.” An administrator’s interpretation of the plan “won’t be disturbed” if reasonable. As a result, a long term disability carrier has the power to review the medical and come to its own determination as to entitlement to benefits.
That’s not good for you! What are examples of discretionary language? Some examples include the following:
“_______X_______carrier shall possess the authority, in its sole discretion, to construe the terms of this policy and to determine benefit eligibility hereunder. _______X______’s decisions regarding construction of the terms of this policy and benefit eligibility shall be conclusive and binding.”
Therefore, based on the language and controlling law, the federal court would have to apply the “arbitrary and capricious” standard of review which results in a limited review of the administrative record and even more limited ability to conduct discovery.
What should I do if my claim for disability benefits has been denied?
If your claim for disability benefits has been denied, please give us a call immediately to look over your denial. You may need a lawyer to get the disability benefits you deserve! 727-894-3188