In the course of my efforts to stay current on the law governing Short Term Disability and Long Term Disability claims, I review a lot of cases governed by the federal statute commonly referred to as “ERISA.”
ERISA is the Employee Retirement Income Security Act. The name sounds like the Act is designed to protect you, the Employee. Don’t be fooled. One case I reviewed recently is Mullins v. Securian Life Ins. Co. It came out of the Middle District of Florida, but there is no need to name or blame the judge for the egregious outcome of the case because the law was, in fact, correctly applied. See, e.g., Gulf Life ins. Co. V. Arnold, 809 F.2d 1520 (11th Cir. 1987). It is just that ERISA allows for the absurd result of the cause of action.
The bottom line in the case is that a named beneficiary was determined not to have standing to bring a claim to assert her rights to the life insurance proceeds at issue. This was because she was not a “beneficiary” of the Employee Welfare Benefit Plan of which the Life insurance Policy was a part.
The Problem With ERISA: Congress
This whole issue regarding whether a person is a beneficiary is due entirely to Congress’ clumsy attempt to apply the law of Trusts and other equitable principles to issues that are clearly not best handled in such a fashion.
Benefits available pursuant to the typical “Employee Welfare Benefits Plans” governed by ERISA include not only Short Term Disability and Long Term Disability claims but also medical life insurance, pension, and other group benefits provided by private employers. The claims for those benefits are legal claims with no need to refer to trust or equitable principles to determine the entitlement.
My law school Equity professor, the awesome “Commander Hughes,” is probably rolling over in his grave. Aced that course.
How Can ERISA Affect Your Claim?
So, what is the practical effect for someone making a Short Term Disability or Long Term Disability benefits claim? Beyond the standing issue, there are numerous pitfalls. The right to a jury or any type of trial is lost. The Judge only reviews the “Administrative Record” to make a determination, so there are no depositions or other sworn evidence.
Even if the Judge decides the decision to deny benefits was wrong, the inquiry does not stop there. If the decision maker, i.e., the insurance company, has been granted “discretionary authority,” the Judge must determine whether the wrong decision was nonetheless reasonable based on the evidence found in the Administrative Record.
When an insurance company is involved, the requirement that these claims have to go through this type of mental gymnastics cannot be justified on any basis.
Herbert M. Hill, P.A. Can Help You Navigate ERISA
Many such issues might arise in your Short Term Disability or Long Term Disability claim. Herbert M. Hill, P.A. is a law firm with offices in Orlando, Florida which practices exclusively in disability benefit claims and others that arise under ERISA. We know the benefits you are entitled to and how to get them. Contact us today to discuss your case. We are prepared to pursue your claim vigorously!
