An ERISA claim involves a dispute over benefits provided through an employer-sponsored plan, such as health insurance, retirement, or disability benefits, under the Employee Retirement Income Security Act (ERISA). If a claim is denied, you can file an administrative appeal. If that’s unsuccessful, the next step is to file a lawsuit in federal court. The ERISA litigation process includes filing the lawsuit, limited discovery (where both sides exchange evidence), pre-trial motions, and possibly a court proceeding.
An experienced ERISA claims lawyer can help by guiding you through the complex process, ensuring that deadlines are met, interpreting the plan documents, gathering necessary evidence, handling the appeal, and representing you in court. They can increase your chances of successfully obtaining the benefits you are owed.
What is an ERISA Claim?
ERISA sets the standards for most voluntarily established pension, health, and disability plans in private industry, ensuring that employees’ benefits are protected and that plan administrators act in the best interests of the workers. When a person believes an employer or insurance company wrongfully denied, delayed, or mishandled their benefits, they can file an ERISA claim to resolve the issue.
Why are ERISA Claims Frequently Denied?
ERISA claims, which involve disputes over employee benefits, are sometimes denied. There are several common reasons why these claims are rejected, including all of the following:
- Incomplete or Incorrect Information – One of the most common reasons for an ERISA claim denial is the submission of incomplete or inaccurate information. When filing a claim, it’s important to provide all required documents and forms, as well as accurate medical records, proof of eligibility, or other supporting evidence. If the information is missing, incomplete, or incorrect, the insurance company or plan administrator may deny the claim. For example, if a doctor’s note is not included or a disability claim lacks sufficient medical evidence, the claim can be rejected.
- Failure to Meet Eligibility Requirements – Each ERISA plan has specific eligibility requirements, such as a minimum number of hours worked or a waiting period before coverage begins. If the employee or their dependents do not meet these criteria, the claim will likely be denied. This is a common issue with disability claims, where employees may assume they are covered but discover that they do not meet the necessary conditions.
- Pre-existing Conditions – Some disability plans have exclusions for pre-existing conditions, meaning any health issues that existed before enrollment in the plan may not be covered. If an employee files a claim for a condition that is considered pre-existing, the insurance provider may deny the claim based on this exclusion. However, ERISA regulations require clear disclosure of such exclusions in the plan’s documents, and a denial based on this reason can often be contested if not properly explained.
- Lack of Medical Necessity – For health-related claims, such as surgeries or treatments, insurance companies often require that the service be medically necessary. If the treatment is not deemed medically necessary or alternative, less-expensive options are available, the claim can be denied. Disability claims may also be denied if the insurance provider believes the condition does not prevent the employee from working, even if the employee believes otherwise.
- Failing to Follow Proper Procedure – ERISA plans often have strict timelines and procedures for filing and appealing claims. Missing deadlines or failing to follow the necessary steps for appeal can lead to a claim being automatically denied. Employees must carefully follow all rules, such as submitting the claim within a certain time frame or following the correct steps for an appeal.
If a claim is denied, employees have the right to appeal the decision through an administrative process.
Filing an Administrative Appeal in an ERISA Case
When an ERISA claim is denied, the claimant often can file an administrative appeal. This is a vital step in the process to contest the denial and potentially receive the benefits they are entitled to recover. An administrative appeal is the first line of defense for those who believe their claim was wrongfully denied under their employer-sponsored disability plan.
- Review the Denial Letter – The first step in filing an ERISA appeal is to carefully review the denial letter. This letter should outline the reasons for the denial, including specific provisions of the plan cited in the decision. Understanding these reasons is essential for crafting a solid appeal. The letter may also include information on how and when to file an appeal, including deadlines and required documents.
- Gather Supporting Evidence – Once the reason for the denial is clear, the next step is to gather any evidence that may support the claim. For disability claims, this may include pertinent medical records, doctor’s notes, or expert opinions that show why the claim should be approved. The more evidence you can provide, the stronger your appeal will be.
- Prepare the Appeal Letter – In the appeal letter, you should clearly state why the denial was incorrect and present your supporting evidence. It’s important to address the reasons the claim was denied and show how the evidence contradicts the denial or meets the plan’s requirements. Your appeal letter should include all relevant documents. Some plans may provide a standard form for submitting appeals, while others require a written letter.
- Submit the Appeal Within the Deadline – ERISA plans usually have strict deadlines for filing an appeal, typically within 180 days of the denial. It’s important to submit your appeal before this deadline to avoid losing your right to contest the decision. Keep copies of all documents, including the appeal letter and any evidence submitted, for your records.
- Wait for the Decision – Once your appeal is submitted, the plan administrator has a certain period – usually 45 days – to review the appeal and make a decision. Sometimes, they may ask for additional information, which can extend the initial review period.
If the appeal is denied again, the next step may involve further appeals or filing a lawsuit in federal court. While administrative appeals are often complicated, they offer an opportunity to resolve the dispute before taking legal action.
Procedures for Successfully Litigating an ERISA Case
If an ERISA claim is denied after going through the administrative appeal process, the next step may be to file a lawsuit in the federal court system. Litigation is often the final option when all other efforts to resolve the claim fail. Below are the key procedures in litigating an ERISA claim, from filing the lawsuit to the potential outcomes.
- Filing the Lawsuit – The first step in the litigation process is filing a lawsuit in federal court. ERISA claims are generally heard in federal court because ERISA is a federal statute. A lawsuit is typically filed against the plan administrator or the employer responsible for denying the benefits. It is important to file the lawsuit within the statute of limitations, usually three years from the date the claim was denied, although this can vary depending on the plan. The lawsuit must outline the legal grounds for the claim, such as wrongful denial of benefits or failure to follow ERISA rules. The plaintiff (the person filing the lawsuit) must show that the plan administrator or employer violated the terms of the ERISA plan or acted in bad faith when denying benefits.
- Discovery Phase – Once the lawsuit is filed, the discovery phase begins. This is the part of the litigation where both sides exchange information and evidence. The plaintiff may request documents related to the claim, such as medical records, plan documents, or internal communications. Similarly, the defendant (the party being sued) may request information from the plaintiff to support their defense.
In most ERISA lawsuits, the discovery phase is limited. During discovery, both sides can also take depositions. This means they can question witnesses, including medical experts or individuals involved in the denial decision. The discovery phase is critical for building a strong case, as it provides both parties the chance to gather facts that support their position.
- Motions and Legal Arguments – In many ERISA cases, either side can file motions asking the court to rule on certain issues before the case goes to court. For example, the defendant may file a motion to dismiss the case, arguing that the plaintiff has no valid legal claim. Alternatively, the plaintiff may file motions for summary judgment, asking the court to decide the case in their favor without going to trial based on the evidence already presented.
ERISA cases often focus on legal arguments related to whether the plan administrator made an “arbitrary and capricious” decision in denying benefits, meaning they acted unreasonably or without sufficient evidence.
- Court or Settlement – If the case isn’t dismissed or settled during pre-trial motions, the case will go to court. However, many ERISA claims are resolved before trial through settlement negotiations. If the case goes to court, the judge (not a jury) will hear the evidence and make a decision. Since ERISA cases typically don’t allow for punitive damages or emotional distress compensation, the judge’s ruling will often focus on whether the plaintiff is entitled to benefits under the terms of the plan.
- Appeals Process – If either side disagrees with the court’s decision, they can appeal to a higher court. However, appeals are typically based on legal errors, not new evidence, often prolonging the litigation process.
While sometimes complicated and time-consuming, litigation offers a chance for plaintiffs to receive the benefits they believe they are owed.
How Can an Experienced Attorney Help with Your ERISA Case?
An experienced attorney can be incredibly helpful when dealing with an ERISA claim or lawsuit. ERISA claims often involve complicated legal issues, strict deadlines, and detailed plan documents. Having a skilled lawyer by your side can make the process smoother and increase your chances of achieving a successful outcome. Here are several ways an attorney can assist with your ERISA claim or lawsuit.
- Navigating the Claims Process – The ERISA claims process can be difficult to understand – especially when dealing with complex disability benefits. An experienced claims attorney can handle the entire process, from filing the initial claim to understanding the terms of your plan. They can ensure the required documentation is submitted correctly, avoiding delays or denials due to mistakes.
- Handling Appeals – If your claim is denied, an attorney can file an appeal. A skilled ERISA claims lawyer will review the denial letter, assess the reasons for the denial, and gather the necessary evidence to challenge the decision. They can request medical records, consult with experts, and prepare a compelling argument to present to the plan administrator. Lawyers who regularly handle ERISA cases are familiar with the specific legal standards that apply to appeals, increasing the likelihood of a successful appeal in your case.
- Interpreting Plan Documents – ERISA plans come with dense, complex documents that outline eligibility, benefits, and exclusions. Understanding these terms is important for making a valid claim. An attorney can interpret the legal jargon in the plan documents and explain how the provisions apply to your unique situation. They can also identify potential flaws in the plan’s administration, which may help your case.
- Representing You in Court – If your claim is still denied after the appeals process, an attorney can represent you in federal court. ERISA lawsuits are typically filed in federal court, and handling them requires specific knowledge of federal law. An experienced ERISA claims attorney will understand how to present your case effectively, including filing the right motions, gathering evidence, and making legal arguments. They will also know how to deal with the “arbitrary and capricious” standard that often applies in ERISA cases.
- Negotiating Settlements – In many cases, ERISA claims are resolved through settlement rather than going to court. An attorney can negotiate with the plan administrator or insurer to reach a fair settlement that meets your needs, potentially saving time and legal expenses.
An experienced ERISA attorney can guide you through the complex claims process, handle appeals, interpret plan documents, represent you in court, and negotiate settlements, making it much more likely that you’ll get the full benefits you deserve.
Speak with an Experienced ERISA Lawyer Right Away
When it comes to filing a claim or lawsuit for ERISA benefits, a skilled attorney can be extremely helpful. Your lawyer will handle every step of the ERISA claims-filing, administrative appeal, or litigation processes for you, helping you secure the full benefits you deserve in your situation.
J. Price McNamara
Attorney
Losing my own brother, then my father and sister after long, disabling illnesses just a few months apart drove a career change for me. Before that experience, I never truly understood the place you’re in. I never understood the dramatic impact that receiving (or not receiving) the disability and life insurance benefits you paid for and counted on can have on your life especially when you need to focus on family and healing. What I experienced with my own family now drives the way I view my clients and my work, and I will never forget it!
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