Date: December 10, 2015
According to an article by Benefits-Partners.com, The EBSA released proposed regulations related to disability plan claims procedures. The proposed regulations are intended to amend the existing rules under ERISA to better align with PPACA’s internal claims appeal rules for health plans.
Under the proposed rules, a disability plan would have to ensure that all disability benefit claims and appeals are adjudicated in a manner designed to ensure the independence and impartiality of the decision makers. For example, a claims adjudicator or medical expert should not be hired, promoted, terminated or compensated based on the likelihood of his denials of benefit claims.
There are three proposed changes to the disclosure requirements. If a claim is denied, the adverse benefit determination must contain:
● A discussion of the decision, including the basis for disagreeing with any determination made by the Social Security Administration, a treating physician or other third party disability payor, if applicable.
● The internal rules, guidelines, protocols, standards or other similar criteria of the plan that were used in denying the claim.
● A statement during the claims stage that the claimant is entitled to receive, upon request, relevant documents. Currently this notice is only required of denied claims on appeal.
The proposed rules would require that the plan provide the claimant with any new or additional evidence in connection with the claim. The information must be provided free of charge and must be provided prior to the appeal decision so that the claimant has reasonable opportunity to respond.
Currently, a participant only has the right to appeal a rescission of coverage (i.e., retroactive termination of coverage) if a claim is involved. The proposed rules would permit a participant to appeal any rescission of coverage, regardless of whether the participant was currently receiving benefits.
EBSA proposes that disability plans adopt the culturally and linguistically appropriate notice requirements under PPACA. Specifically, if a disability claimant’s address is in a county where 10 percent or more of the population is literate only in the same nonEnglish language, notices of adverse benefit determinations must include a prominent onesentence statement in the relevant nonEnglish language about the availability of language services. The plan would also be required to provide a verbal customer assistance process in the nonEnglish language.
Lastly, EBSA requests comments not only on the provisions outlined here, but also specifically related to statute of limitations and whether plans should be required to provide claimants with a clear and prominent statement of any applicable contractual limitations period and its expiration date for the claim at issue in the final notice of adverse benefit determination on appeal.
Comments are due by Jan. 17, 2016.