If you have questions about what type of information to include with your appeal, contact Patrick Mause for a free consultation on the types of information you might want to include when you appeal an insurance company’s denial of your long-term disability claim.
Frequently, disability insurance companies would cross-sell “long-term care” insurance policies. These policies, similar to a long-term disability insurance policy, pay a monthly benefit to the insured; often several thousand dollars a month. Unlike a disability policy, however, long-term care insurance pays benefits if the insureds are unable to care for themselves. These policies typically require the insureds to show they require assistance with “Activities of Daily Living” or “ADLs,” or that they have a cognitive impairment and need someone to help keep them safe.
Also similar to disability insurance, some long-term care insurance companies are facing huge financial difficulties with their policies. Unfortunately, some of those companies have decided to address their financial difficulties not by tightening their belts or paying lower dividends to their investors but by deliberately shortchanging their insureds. Fortunately, most long-term care insurance policies are not subject to ERISA. These claims are therefore usually subject to Arizona bad faith law, and an insured whose long-term care benefits were wrongfully denied may be able to seek full compensatory damages and punitive damages.
Like disability claims, long-term care claims require a dedication to understanding not only the insurance policy issues, but also a dedication to understanding the insured’s medical issues, how they affect the person, and how they impact their insurance coverage. Through his nearly two decades of experience, Patrick has developed the knowledge required to investigate and pursue these cases.
If you believe you have been treated unfairly by your long-term care insurer, contract Patrick today for a free consultation.
Fighting Insurance Providers Who Act in Bad Faith
In Non-ERISA Insurance Cases, Bad Faith and Punitive Damages May Be Available
People buy insurance to obtain “security and protection from calamity” and to avoid financial ruin. Thus, as Arizona courts have made clear, insurance policies involve a “special relationship” under which insurance companies have to comply with all aspects of the “duty of good faith and fair dealing.”
While some insurance companies may work hard to honor their insureds’ policies, others do not. Because of the “special relationship” involved in insurance policies, however, and because limiting claims only to “contract remedies” (the disability or other benefits due), Arizona allows insureds whose claims were wrongfully denied to “maintain an action in tort and to recover tort damages”; which may include compensation for all the harms the insured suffered due to the insurance company’s wrongful conduct. For example, if someone’s disability or long-term care claim is wrongfully denied they may be unable to pay their rent or mortgage, pay their medical bills, or pay for their child’s education. In a non-ERISA “bad faith” case, the insured is entitled to recover not only the benefits they are due but also to recover compensation for all the harms they suffered due to the insurance company’s wrongful conduct.
In some cases, the insurance company’s misconduct warrants “punitive damages,” or damages designed to punish the insurance company and deter it from engaging in the same wrongful conduct in the future. For example, some insurance companies have instituted policies to achieve a pre-set number of claim closures every month. And some insurance companies penalize employees who don’t achieve those pre-set numbers and reward the ones who do. In such cases, punitive damages may be warranted to punish the insurance company and deter it from engaging in the same bad faith conduct in the future.
Patrick has helped numerous clients with their disability and long-term care bad faith claims. If you believe you have been treated wrongfully by your insurance company, contact Patrick today for a free consultation.
Our Services Include:
Short- and Long-Term Disability ERISA Appeals
Short- and Long-Term Disability ERISA Litigation
ERISA is a complicated legal and regulatory scheme that involves many issues not typically found in other cases. These include:
Appealing the Denial of an STD or LTD claim
The Insurance Company’s “Discretionary Authority” to Decide Claims
The Insurance Company’s “Inherent Financial Conflict of Interest”
Exceptions to ERISA Like “Governmental Plans,” “Church Plans,” and the “Safe Harbor”
ERISA’s Preemption and Prohibition of “Bad Faith,” Compensatory, and Punitive Damages
Congress passed ERISA — the Employee Retirement Income Security Act — for the express purpose of protecting employee benefits. As part of its goal to bring uniformity to state law, Congress provided that ERISA “preempts” state laws that relate to an employee benefit plan. While there are some exceptions (government employees, employees of certain “church plans,” certain “safe harbor” exceptions), most benefits provided by a private employer are subject to ERISA. Consequently, most short- and long-term disability claims are subject to ERISA.
ERISA claims have several unique features. For example, ERISA claims are generally decided based on the “closed administrative record,” meaning the claim file that was in front of the insurance company when it denied the claim. Because of this unfortunate feature, the ERISA appeal process is even more important — if you don’t submit the right types of information you might be precluded from raising it later.
There is also no right to a jury trial. Instead, ERISA lawsuits are decided by a judge who reviews the “closed administrative record” and other potentially relevant information, such as evidence of the insurance company’s or administrator’s conflicts of interest. Indeed, one of the big features of ERISA litigation is fighting over the insurance company’s (and its allegedly “independent” reviewers’) conflicts of interest.
Another feature of ERISA is that cases are typically heard in Federal Court. While Arizona state courts have jurisdiction over ERISA cases, any ERISA claim can be “removed” to federal court due to ERISA’s “complete preemption” of the state law claims. Thus, even if people file suit in Arizona Superior Court, and even if they never mention ERISA, their case can be “removed” to federal court as long as their claim relates to an ERISA-governed employee benefit.
ERISA’s “complete preemption” also means that all state law claims — such as claims for bad faith, compensatory damages, and punitive damages — are “preempted” by ERISA. Thus, in an ERISA case, the only claims available to the insured is a claim for benefits or “clarification” of their right to benefits, potentially a claim for “other appropriate equitable relief,” and a claim for attorney’s fees and costs incurred in the lawsuit.
The Law Office of Patrick Mause, PLLC
(520) 342-0026
(520) 342-0001
patrick@pmauselaw.com
1830 E Broadway Suite 124-302,
Tucson, AZ 85719
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