Articles Posted in New and Newsworthy

For the approximately one million Americans living with Autism, proving their rights to insurance proceeds and coverage as well as SSDI may soon become even more difficult.

The American Psychiatric Association has appointed a panel that is reviewing the current definition of Autism as a prelude to publishing the newest version of the D.S.M. Currently, “a person can qualify for the diagnosis by exhibiting six or more of 12 behaviors; under the proposed definition, the person would have to exhibit three deficits in social interaction and communication and at least two repetitive behaviors – a much narrower menu.” New York Times Article, January 19, 2012. Additionally, the proposed definition would unite all Autism spectrum disorders – including Asperger’s Syndrome and Pervasive Developmental Disorder-under a single heading. The result, say some experts, will be a large drop in those who qualify for the diagnosis. The result of losing an Autism Diagnosis may be a loss of medical benefits, Social Security Disability, support groups and housing. Similar implications are likely for private insurance benefits.

We at Bonny G. Rafel are experienced in helping those with difficult-to-diagnose conditions prove their disability and obtain the benefits they deserve.

Insurance fraud is a major offense that can carry with it serious repercussions. In order to combat this problem, New Jersey instituted the Insurance Fraud Prevention Act, N.J. Stat. §§ 17:33A-1 to 30. The goal of the act is to prevent insurance fraud in the state of NJ by amongst other things, better fraud detection, developing fraud prevention programs, and requiring repayment for fraudulent insurance benefits received. N.J. Stat. § 17:33A-2.

It is extremely important that when providing information about a claim that you are accurate and honest. According to the act, knowingly making or providing false or misleading statements concerning any fact or thing material to a claim constitutes fraud. N.J. Stat. § 17:33A-4(a). Not only can insurance fraud lead to criminal charges but a person committing insurance fraud can face severe civil penalties as well. If the insurance commissioner has deemed someone to be in violation of the act, the commissioner may seek a civil action, place an administrative penalty on the person, and/or order restitution including but not limited to attorney fees and cost of prosecution. If the commissioner orders an administrative penalty or restitution be paid, a person may request a hearing within 20 days of receipt of the violation. Additionally, if criminal charges are not already brought against you, the commissioner may request that the Attorney General do so.

In addition to facing state imposed penalties and fines, anyone who violates this act may be sued by any insurance company damaged by the fraudulent act. The insurance company can recover compensatory damages that can include surveillance and investigation costs, attorney fees, and any costs related to the lawsuit. If successful the court may award treble damages (three times the amount of the damages) if it is determined that the person has engaged in a pattern of violating the act. N.J. Stat. § 17:33A-7(b). “Pattern” means five or more related violations of the Fraud Act. . Allstate Ins. Co. v. Greenberg, 376 N.J. Super. 623, 640 (Law Div. 2004).

An error made by the fiduciary to a defined contribution pension plan had to abide by a judgment requiring it to reimburse the plan participant whose funds were incorrectly distributed. In the recent Second Circuit case of Milgram v. The Orthopedic Assoc. Defined Contribution Pension Plan, even if the plan could not recoup the money it had wrongfully paid out, it must still honor its legal obligation to pay the pension participant.

The pension at issue was a Defined Contribution Plan. The plaintiff divorced his wife, and based on a property settlement agreement, the plan administrator erroneously transferred half of the plan funds to her, resulting in an overpayment to her of $763,847.93. The husband sued the plan under ERISA to recoup this money.

The plan argued, it could not distribute the money without first being repaid by the ex-wife, since doing otherwise would reduce the plan assets, which they refer to as alienating the benefits of other plan members.

Many health and disability group insurance contracts contain discretionary clauses—clauses that provide the company writing the contract with the discretion to determine the meaning of contractual terms or to determine the insured’s eligibility for benefits. If your disability insurance policy is subject to ERISA, meaning it was purchased by your employer as part of a group plan, it most likely includes a discretionary clause. In order to prevail in court against an insurer, the claimant must demonstrate not just that the insurer’s decision was wrong, but that the insurer abused its discretion in making that decision. Insurers use these clauses to deny claims, with knowledge of the added difficulty these clauses provide for their customers to succeed in court.

State legislators are reacting to these unfair clauses. California recently enacted a law, making discretionary clauses in disability and life insurance policies

The Third Circuit is finally catching up to other Circuits in recognizing the importance that a conflict of interest plays in an insurer’s decision to accept or deny a disability claim. The Third Circuit in Miller v. American Airlines noted that the claim administrator acted unreasonably by imposing additional requirements under the Plan; failing to include in its denial letter exactly what the claimant needed to provide in order to satisfy the plan requirements, failing to adequately consider all medical diagnoses and even the occupation in evaluating the case.

On the heels of Miller, our New Jersey Courts have issued another well considered opinion. Connor v. Sedgwick Claims Mgmt. Servs., 2011 U.S. Dist. LEXIS 67988 (D.N.J. June 24, 2011) The court in Connor embraced the reasoning of Miller, requiring that the termination letter provide the “precise information necessary to advise” a plaintiff “how to perfect his claim.”

The denial letter must detail how the claimant “could achieve a favorable disability determination.”

A report from The American Medical Association released in June found an increased inaccuracy in the payment of health claims. This means an astounding 3.6 million claims are being handled incorrectly.

The error rate is 19.3%, an increase of 2% over the last year. The one in five claims is being handled erroneously leads to waste in money spent on health care and administrative costs, as well as frustration for patients and health care providers. AMA Board Member Barbara McAneny, MD stated that these errors wasted an stonishing $17 billion. McAneny goes on to say that “Health insurers must put more effort into paying claims correctly the first time to save precious health care dollars and reduce unnecessary administrative tasks that take time and resources away from patient care.”

At Bonny G. Rafel LLC we can help you fight these erroneous denials.

Lower back pain should never be overlooked and can result in disability, especially if surgery fails to permit you to return to full function. We at Bonny G. Rafel review many claims associated with lower back conditions because if you cannot sit for many hours in a day performing your work related duties, you will eventually seek disability benefits.

In a recent article in the Herald Tribune, the author elaborates on the source of lower back pain and the severity of the disorder. The National Institute of Health has stated that lower back pain is their No. 2 neurological disorder, trailing behind headaches.

There are many factors that can increase your risk of developing lower back pain. These factors include being overweight, being in poor physical condition, your age, and even your job. If you have a job that requires constant lifting, bending, or putting any stress on your spine you are more likely to develop back pain. You can also develop this pain by working at a desk and not sitting properly with your back up and straight

Whether you have a desk job or perform manual labor, its vital to consider protecting your income with a disability insurance policy in case you become disabled from working. This is different from worker’s compensation coverage.

In a recent article published in the Times Free Press, the author examines the “public-private partnership” between insurers and the government. Tom Watjen, the CEO of Unum estimated that in roughly 70% of the households, if the breadwinner were to become injured and not able to work, he would not be able to meet all his household expenses.

That is a very scary idea to think that more than 2/3 of America’s workers are not protected. The author of the article notes that more people have fire insurance on their homes and auto insurance on their cars compared to disability insurance even though the odds of getting injured are greater than a house going on fire or a car crash.

Many of our clients file for Social Security Disability benefits in addition to filing for employer sponsored private or group disability benefits. It remains unclear why some of our clients receive immediate approval of their claims, while others have to struggle through the appeals process. We have Social Security attorneys to refer our clients to since we do not handle such cases.

Unfortunately, some SSA decisions seem to depend on what Administrative Law Judge is assigned to your case. In April 2011, a class action lawsuit was filed in Federal District Court alleging that five of the eight Queen’s County Administrative Law Judges are biased against the applicants appealing their adverse Social Security disability decision.

The suit seeks to bar the five judges from hearing any more claims, and to annul all their decisions since 2005 to deny any benefits. Together the five judges have rejected an average of 63% of the cases they have heard since September, a huge discrepancy from the 36% average held nationwide.