What if the Insurer Disagrees with My Health Care Providers or Vocational Experts?

The Regulation:

29 CFR § 2560.503-1 Claims procedure.

(g)Manner and content of notification of benefit determination.

(1) Except as provided in paragraph (g)(2) of this section, the plan administrator shall provide a claimant with written or electronic notification of any adverse benefit determination. Any electronic notification shall comply with the standards imposed by 29 CFR 2520.104b-1(c)(1)(i), (iii), and (iv). The notification shall set forth, in a manner calculated to be understood by the claimant -

(vii) In the case of an adverse benefit determination with respect to disability benefits -

(A) A discussion of the decision, including an explanation of the basis for disagreeing with or not following:

(i) The views presented by the claimant to the plan of health care professionals treating the claimant and vocational professionals who evaluated the claimant;

(ii) The views of medical or vocational experts whose advice was obtained on behalf of the plan in connection with a claimant's adverse benefit determination, without regard to whether the advice was relied upon in making the benefit determination; and…


In Section II.B.2. of the Supplementary Information which precedes the new ERISA regulations in the Federal Register, there is a discussion about the new disclosure requirements.  There is a lot packed into these comments and this second provision of the new rules.  Let’s break them down, starting with the requirement that an adverse benefit determination must include an explanation for agreeing with or not following “[t]he views presented by the claimant to the plan of health care professionals treating the claimant and vocational professionals who evaluated the claimant[.]” 

This rule can be found at 29 CFR 2560.503-1(g)(1)(vii)(A)(i) and 29 CFR 2560.503-1(j)(6)(i)(A).  It appears twice in the rules, once to cover initial adverse benefit determinations, whether a claimant applies for benefits and is immediately denied or is paid benefits for a time and then has his benefits terminated, and once to cover adverse benefit determinations on review, meaning a denial of after an appeal from either kind of initial adverse determination.  The rule also expressly applies to views presented by any vocational experts submitted by the Claimant.

This is in our opinion the most important revision of the rules.  The Supplementary Information rightly points out that the existing disability claims procedure regulation already imposes a requirement that denial notices include a reasoned explanation for the denial.  They also point out that some plans are providing disability claim notices that are not consistent with the current Regulation.  Here is how this typically plays out:  A claimant submits medical records from her providers supporting her disability.  The plan administrator pays an outside physician (which it calls an ‘independent medical examiner’ or IME) who gives an opinion that she is not disabled.  The plan administrator adopts the findings of the IME report, ignores the findings of the treating physician and upholds its initial denial.  The claimant then goes to court.  The judge reviews the insurer’s decision for any ‘abuse of discretion’ and finds none, because the insurer relied the findings of an ‘independent medical examination.’

If this sounds infuriating and unfair, that is because it is.  These revisions promise to end that practice.  If there is one sentence in the Supplemental Information upon which claimants may put their hopes for more fair outcomes, it is this one:  “This provision in the final rule would not be satisfied merely by stating that the plan or a reviewing physician disagrees with the treating physician or health care professional.  Rather, the rule requires that the adverse benefit determination must include a discussion of the basis for disagreeing with the health care professional’s view.”  If interpreted and enforced in this way, this revision will result in a much more transparent and fair claims benefit process for claimants.

One additional point: The Department of Labor appears to have kept the onus on the claimant for ensuring that the plan provide its basis for disagreeing with the views of the claimant’s health care providers.  The DOL wrote that the rule revisions require that adverse benefit determinations contain a discussion of the basis for disagreeing with the views of health care professionals who evaluated the claim “when the claimant presents those views to the plan.”  Claimants would do well to ‘present those views’ to the Plan by submitting all medical records and by providing a notice of appeal that includes a discussion of how those records prove that the claimant is entitled to benefits.


Disclaimer:  The information you obtain in this article is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. We invite you to contact us and welcome your calls, letters and electronic mail. Contacting us does not create an attorney-client relationship.