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Northwest OH Legal Blog

Tuesday, January 16, 2018

UPDATE: WILL AMENDMENTS TO ERISA CLAIMS AND APPEALS’ PROCEDURES FOR DISABILITY BENEFITS STICK FOR 2018?

UPDATE: The U.S. Department of Labor announced its decision for April 1, 2018, as the applicability date for employee benefit plans as the FINAL compliance date with the final rule under ERISA that will provide employees with new protections when dealing with plan fiduciaries and insurance providers who deny their claims for disability benefits.

The new rule will require that disability claimants receive a clear explanation as to why their claim was denied as well as a comprehensive blueprint in order to appeal a denial of a benefit claim. The regulation also clearly identifies how claimants may further review and respond to new information developed by the plan during the course of an appeal. The rule further defines how a claims' adjudicator can be selected to avoid past allegations regarding the likelihood of employers' choosing adjudicators that typically deny claims.

Actually, not at the moment.  The Department of Labor (“DOL”) recently delayed the applicability date of amendments to the ERISA (Employee Retirement Income Security Act) claims and appeals procedures for disability benefit provisions within employee benefit plans until at least April 2018.

The final rule, 81 FR 92316, initially released on December 16, 2016 to take effect on January 18, 2017 for claims filed on or after January 1, 2018 has been delayed so the DOL can allow careful consideration of public comments and data to compare them with the initial goal of this regulation.  The DOL is now focused on examining all regulatory alternatives to ensure full and fair review of disability claims without imposing unnecessary costs and adverse consequences on employee benefit plans and their participants (Executive Order 13777).  

Many of the 110 public comments (received by the DOL) that disagreed with the implementation of this regulatory amendment pertained to the overreach by the DOL to apply Affordable Care Act (ACA) protections to disability benefit claims in the first place.  These disagreements emerged because Congress did not initially extend the ACA protections to the claims and appeals rules, in Section 2719 of the Public Health Service Act, to plans that provide disability benefits. However, the DOL stands firm on its logic that disability benefits involve medical considerations and that disability claimants should receive procedural protections that parallel those that apply to group health plans governed by the ACA.

Other opponents feel that implementation of the amended regulations will cause more gridlock and expense to plans and participants, thereby increasing expenditure of plan resources and governmental audits along with more litigation.  Plan sponsors should continue to pay close attention to the evolution of further delays for these disability benefits appeals’ procedures to determine when they will be required to implement them in 2018, if at all. 

 


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With an office located in Toledo , OH Allotta Farley Co., L.P.A. serves clients throughout northwest OH with various legal matters. Areas of service include Allen County, Ashland County, Auglaize County, Crawford County, Defiance County, Erie County, Fulton County, Hancock County, Hardin County, Henry County, Huron County, Lucas County, Marion County, Mercer County, Morrow County, Ottawa County, Paulding County, Putnam County, Richland County, Sandusky County, Seneca County, Van Wert County, Williams County, Wood County, Wyandot County.

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