Erisa Case: How to Fight a Denied Benefits Claim

ERISA covers pension plans, welfare benefit plans, disability benefits, health insurance, and life insurance sponsored by private employers. Section 502(a) of ERISA (29 USC § 1132) provides the civil enforcement mechanism. ERISA preemption displaces all state law claims that relate to an employee benefit plan. A participant or beneficiary may bring an ERISA lawsuit under Section 502(a)(1)(B) to recover benefits due under the plan.

ERISA litigation counsel evaluates whether the plan at issue is an ERISA-covered plan, identifies the plan type and the applicable civil enforcement provision, and advises claimants on the exclusive remedies available under Section 502(a) of ERISA.

ERISA requires plan administrators to provide written denial notice stating specific reasons and plan provisions. The summary plan description (SPD) describes plan benefits, eligibility, and claims procedures. A denial notice that fails to satisfy ERISA's notice requirements is procedurally deficient. A procedurally deficient denial can affect the standard of review in federal court.

Life insurance claim denial counsel reviews the denial notice and plan documents for procedural deficiencies, evaluates whether the denial complies with ERISA's notice requirements and the Department of Labor's claims procedure regulations, and advises on the effect of procedural deficiencies on the standard of review.

ERISA regulations require plans to provide at least one level of internal appeal. Group health plans and disability plans must provide at least one level of internal review. The administrative appeal is the most important phase of an ERISA denied benefits claim case. The administrative record created during the appeal is the record that the federal court will review. The claimant must submit all medical records, expert opinions, vocational evidence, and legal arguments during the administrative appeal.

Insurance recovery counsel prepares the ERISA administrative appeal, develops the administrative record with medical evidence, expert opinions, and legal arguments, and advises on the deadline requirements and the documentation standards required to preserve the claimant's rights for federal court review.

ERISA requires procedural compliance from plan administrators throughout the appeal process. The plan administrator must give the claimant the opportunity to review and respond to new evidence. In disability benefit cases, the administrator must provide claimants with copies of new evidence or rationale before issuing the final denial. A plan that fails to comply with these requirements may be deemed to have provided no administrative remedy. The administrator must issue a written decision within the timeframes established by ERISA regulations.

Labor and employment law counsel monitors the administrator's compliance with ERISA's procedural requirements during the appeal, advises on the claimant's right to respond to new evidence and rationale under the Department of Labor's 2018 disability claims regulations, and advises on the consequences of procedural violations for the subsequent federal court proceeding.

The standard of review depends on whether the plan document grants the administrator discretion. When a plan grants discretion, the court applies the arbitrary and capricious (abuse of discretion) standard. Under de novo review, the court examines the denial without deference and reaches its own independent conclusion. De novo review is significantly more favorable to claimants than arbitrary and capricious review.

Employee benefits counsel evaluates the plan language to determine the applicable standard of review, analyzes the administrator's decision for procedural and substantive errors that may entitle the claimant to de novo review, and advises on the circuit-specific law governing the standard of review in ERISA benefit cases.

A conflict of interest exists when the administrator that decides claims is also the insurer. This is a structural conflict. The Supreme Court addressed structural conflict in MetLife v. Glenn (2008). Under Glenn, the conflict of interest is a factor courts must weigh in determining whether the administrator abused its discretion. Courts examine whether the plan hired claims reviewers with financial incentives to deny claims. They also examine whether the plan selectively reviewed the administrative record or ignored treating physician opinions.

Appeals counsel evaluates the record for evidence of structural conflict and biased claims administration, advises on the weight courts give to conflicts of interest under MetLife v. Glenn and circuit-specific precedent, and advises on how to frame conflict of interest arguments in the federal court pleadings.

ERISA imposes fiduciary duties on plan administrators, trustees, and investment managers. Breach of fiduciary duty claims under Section 502(a)(2) are brought on behalf of the plan. These claims are the basis for ERISA class action litigation. The Supreme Court's decision in CIGNA Corp. .. Amara (2011) clarified that equitable remedies under Section 502(a)(3) are broader than previously understood. Equitable remedies include surcharge, disgorgement of profits, and reformation of plan terms.

Veteran benefits denied counsel evaluates ERISA breach of fiduciary duty claims and the availability of class action remedies under Section 502(a)(2), advises on the equitable relief available under Section 502(a)(3) and the CIGNA v. Amara framework, and advises on the procedural and standing requirements for ERISA class action litigation.

ERISA allows a court to award attorney fees and costs to either party. The Supreme Court's decision in Hardt v. Reliance Standard (2010) clarified that a claimant does not need to be a prevailing party to recover attorney fees. This fee-shifting provision makes ERISA litigation economically viable for claimants. Pre-litigation steps are critical in an ERISA case. The claimant must obtain a complete copy of the administrative record before filing suit. The administrative record is the battleground. The battle for the administrative record begins the moment the claim is denied.

Bad faith insurance counsel advises on the pre-litigation steps required before filing an ERISA lawsuit, evaluates the attorney fee exposure and recovery prospects under Hardt v. Reliance Standard, and advises on the litigation risk assessment that claimants must conduct before investing in federal court ERISA litigation.