Effective for disability benefit claims filed after April 1, 2018, a new rule from the U.S. Department of Labor (DOL) requires ERISA-covered employee benefit plans offering disability benefits to provide additional procedural protections to claimants. The new rule ensures that protections for disability claimants parallel protections under the Affordable Care Act that already apply when workers file claims for group health benefits. These new protections apply to all ERISA-covered disability plans, regardless of how the benefit is characterized by the plan or whether the plan is a pension plan or a welfare plan.
Changes to Claim Processing Requirements
Most notably, the rule includes the following changes to the requirements for claim processing:
- Improvement to Basic Disclosure Requirements. Benefit denial notices must include a more complete discussion of why the plan denied a claim and the standards used in making the decision. For example, in relevant cases, the notice must explain why the Plan Administrator disagrees with the opinions of the participant’s or beneficiary’s health care professionals, vocational experts, or the Social Security Administration’s determination of disability.
- Right to Internal Protocols. Benefit denial notices must include the internal rules, guidelines, protocols, standards, or other similar criteria of the plan that were used in denying a claim, or a statement that none were used.
- Access to Claims File. The Plan Administrator must inform participants, in benefit denial notices (rather than simply in notices denying benefits on appeal), that they are entitled to access, upon request and free of charge, all documents relevant to an adverse claim determination.
- Avoiding Conflicts of Interest. Plans must ensure that disability benefit claims and appeals are adjudicated in a manner designed to ensure the independence and impartiality of the persons involved in making the decision.
Employers should work with their disability carrier to ensure that all of the requirements under the new rule are being met. HR Works Virtual HR Helpline clients should contact the helpline at (585) 381-8340 x 1 or firstname.lastname@example.org with any questions.
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