 |
 |
|
Benefit Claims |
|
|
|
|
Wrongful Denial of Benefits Due
Wrongful denial of benefits claims cover a broad range of problems ranging from clerical errors to misreading of plan documents to outright refusal to pay a benefit you know is due. The following are examples from recent cases:
- You apply for your company's Long Term Disability (LTD) insurance program, due to your suffering a disabling illness. Your company, or the insurance company hired to administer the LTD plan, wrongfully denies you coverage. You may bring suit to recover the benefits that are due to you.
- You are a healthcare provider. You treat a patient and submit your bill to the patient's insurance company. The insurance company refuses to pay the bill, however, fails to provide you with any real reason other than the standard line of "not medically necessary". You may bring suit not only to recover the amount you are due, but also statutory fines, if the insurance company failed to provide you with critical documents necessary to perfect your claim for reimbursement.
- Your spouse's employer offers its employees various benefits - including life insurance. The Company decides to cut the amount of coverage in half (from $100,000 per employee to $50,000). However, the Company never tells you or your spouse about this. Your spouse continues to participate in the life insurance program, not knowing the coverage is substantially less than you and your spouse thought was needed to support your family if your spouse passed away. Unfortunately, your spouse passes away without learning that the benefits were cut or after learning of it only when it was too late to get replacement coverage. Your family seeks to collect the life insurance from the company, but the company, citing the reduction in coverage, refuses to pay the full amount. Under federal law your employer has a duty to promptly and directly inform your spouse that his benefits were cut.
Under most circumstances, your employer or its designee can can be held liable for the money you should have received plus your attorney's fees, interest, and costs.
Cash Balance Cases
Benefit Related Discrimination
Federal law prohibits benefit plans from discriminating among employees eligible for the plan or an amendment to an already existing plan. Discrimination under ERISA can occur in many ways:
Cash Balance Plans: Recently companies have turned more and more to so-called cash balance plans. The cash balance account creates a sliding scale for accrual of retirement benefits. Under the cash balance approach, an employer places a fixed percentage of an employee's pay into the account and guarantees a fixed percentage of growth each year. Today, many companies are attempting to amend their defined benefit or classical defined contribution (i.e. a contributory 401(k) plans) into cash balance accounts. By doing this many companies may deprive their employees of substantial retirement benefits. To learn more about cash balance plans read our publication Cash Balance Plans: Terminology, Advantages and Disadvantages to Employers and Employees.
Arbitrary and Capricious Plan Amendment: The United States Supreme Court has stated that to amend an ERISA plan your company must follow the procedures established in the plan. Therefore, "piecemeal" or "informal" amendments are not allowed. An "informal" amendment typically occurs where one employee is given a retirement incentive and other similarly situated employees are denied such benefits for no reason.
Interference with Benefits: Your company cannot modify your employment in a manner which would interfere with your obtaining a benefit owed to you. Typically, this type of case arises where your company wrongfully terminates your employment to keep you from obtaining a benefit incentive. However, interference with benefits may include where your company wrongfully transfers you from a department slated to receive an incentive to prevent you from receiving the incentive.
Golden Handshakes and Other Retirement Incentives
Failure of Employer to Disclose Benefit Improvements Our firm handles many claims of this type. If the following fact pattern sounds familiar, you may have a claim.
You retired from your Company on December 31, 2001. When you retired the company human resources personnel gave you the standard retirement information. They did not mention to you that the company was considering a plan to improve its retirement benefits or offer a "golden handshake".
After you retire, a former co-worker calls to tell you the company increased retirement benefits after you retired and had you delayed your retirement you could have received those benefits. You are angry, because you would have stayed at the company if you knew that postponing your retirement would have meant getting the increased benefits.
ERISA requires companies that offer pension plans, health plans and other benefit programs to be truthful, accurate and complete when informing employees about their options and benefits. Under most circumstances, this includes disclosing to retiring employees the company's serious consideration of any benefits increase, golden handshake or similar separation incentive. Companies may not discriminate among employees when disclosing retirement information.
Our lawyers and staff work with clients to determine whether their employers wrongly withheld benefits information. If information was wrongfully withheld, we establish a plan to recover what our clients worked hard to earn. While every case is different, here are some thoughts to consider:
- If your company increased benefits after you retired, how close to your retirement date were the benefits increased? The closer your retirement date to the benefits increase, the more likely the increase was under serious consideration at the time you retired.
- How big is your company? Companies with thousands of employees do not make decisions over night. Generally, the larger the company, the longer the period of time a plan will be under serious consideration.
- Has your company PREVIOUSLY offered a retirement incentive or other benefit increase? History sometime repeats itself and if your company has previously issued retirement incentives, it may do so again in the future.
- Prior to retiring, did you hear rumors about a benefit increase or golden handshake? Rumors in the workplace are usually a good sign that something is in the works.
- Is your company "downsizing"? Retirement incentives are often employed in downsizing.
If your company did withhold incentives due to you under a retirement plan, our work enforcing your rights is a three-step process: (1) we make a Certified Demand with the company's human resources department articulating the basis under federal law why you are entitled to inclusion in the incentive; (2) if your demand is rejected, we make a Certified Administrative Appeal; and (3) if your appeal is rejected we file a lawsuit under ERISA.
Generally, lawsuits take from 2 to 5 years to complete. While usually a settlement can be reached, sometimes trials are required. While we cannot assure positive results, we have a proven track record of success. Further, our lawyers and staff will be with you at every step to help you through the process, answer questions and address concerns.
Claims against HMO's
If an HMO denies coverage to a participant in an ERISA qualified plan, the HMO may have violated ERISA. Denial of coverage claims, malpractice claims, and discrimination claims can be brought in the federal courts. Like other areas of our practice, we expect this will be an area where much new law will be made trying to address growing evidence of wrongdoing by the insurance industry.
Fraud, Theft, and Mismanagement of Funds
Your company hires an outside investment firm to act as trustee of the assets of the 401(k) plan in which you and your co-workers invest part of your weekly salary. The company neglects to monitor how the trustee is investing the money to be sure it is invested legally and prudently. As a consequence the plan makes significantly less money than it should or -- worse yet, the trustee steals the money in the plan!
Companies that hire other companies to manage their pension assets owe a duty to employees to make sure the money is safe and well invested. While the trustee is responsible for his conduct, the trustee is not the only one responsible. Therefore, if the trustee is broke or uninsured, the company which hired him can be held responsible for his bad management or theft.
Nothing in this website is a promise or guarantee about the outcome of any case. We make no promises or guarantees. Cases are decided on their own facts and we cannot imply that our previous success will result in us winning your case. |
|
| |
|
|
|
