As the COVID-19 pandemic continues, you may find it challenging to file a short- or long-term disability claim or appeal within the prescribed deadlines. Thankfully, many ERISA long term disability deadlines have been suspended amid COVID-19. This is a tremendous help because COVID-19 may make it difficult to gather the medical evidence needed to support your claim or appeal. Even with telemedicine appointments available from some providers, getting an appointment scheduled can be hindered due to office closures, reduced hours, and staffing reductions. Some providers may not have any available appointments at all.
The New Rules Establish an “Outbreak Period” Amid COVID-19
Recognizing the roadblocks you may face in filing a timely disability claim or appeal, the Department of Labor (DOL) and the Internal Revenue Service (IRS) have provided some relief. On May 4, 2020, the agencies issued new rules to temporarily suspend certain deadlines associated with ERISA-covered disability plans. On February 2, 2021, the agencies clarified that any deadlines suspended may only be suspended for up to one year.
The new rules establish an “Outbreak Period” for which certain ERISA deadlines will be extended. The new rules define the Outbreak Period as starting on March 1, 2020. The Outbreak Period will end 60 days after the end of the COVID-19 National Emergency is declared. These new rules are designed to protect against the possibility of individuals losing or forfeiting benefits due to failure or inability to comply with certain pre-established pre-pandemic timeframes.
The Outbreak Period Stops the Clock on Disability Claim and Appeal Deadlines
The Outbreak Period “stops the clock” on certain deadlines in ERISA disability plans. Until the Outbreak Period is over, the associated deadlines will be paused, resuming only 60 days after the COVID-19 National Emergency state ends. The deadlines that have been paused may be paused for up to one year.
The deadlines that the Outbreak Period – the days between March 1, 2020 and 60 days after the announced end of the COVID-19 national emergency – effectively puts on hold are:
How the Outbreak Period Applies to Short- and Long-Term Disability Claims
The Department of Labor (DOL) Claims Procedure Regulation provides that each plan must establish and maintain reasonable procedures governing the filing of benefit claims. However, the DoL regulation does not provide a timeframe for filing initial claims. Therefore, each short- or long-term disability plan must set its own timeframe.
Typically, disability plans governed by ERISA require claims to be submitted within 90 days of disability.
Example 1 – Filing a Claim:
Say your long-term disability plan requires claims to be submitted within 90 days of your date of disability. And say your disability began on January 1, 2021. Your deadline for filing a disability claim has been frozen since the beginning of the Outbreak Period, which began on March 1, 2020.
Because the beginning of your disability happened during the Outbreak Period, 90 days have not passed for purposes of the deadline to file your claim.
If, for example, the end of National Emergency is April 1, 2021, the Outbreak period will end 60 days later (May 31). Your deadline will arrive 90 days after that, or on August 29, 2021.
But, in no event will the deadline for filing a claim under your long-term disability plan be postponed for longer than one year.
How the Outbreak Period Applies to Short- and Long-Term Disability Appeals
The Department of Labor Claims Procedure Regulation provides that each plan must allow claimants at least 180 days following receipt of an adverse benefit determination such as a denial of benefits or a termination of benefits to appeal. Short- or long-term disability plans governed by ERISA may allow for more time to appeal an adverse decision, but they must allow at least 180 days.
Typically, disability plans governed by ERISA require appeals to be submitted within 180 days of an adverse decision.
Example 2 – Filing an Appeal:
Say your long-term disability plan requires appeals to be submitted within 180 days of your claim denial. And say you received a letter informing you that your claim for benefits was denied on January 1, 2021. Your deadline has not arrived for filing an appeal.
Once the Outbreak Period ends you will have another 240 days to file your appeal (180 days plus the 60 days after the Outbreak Period).
If, for example, your claim was denied on January 1, 2021, and the end of National Emergency is June 1, 2021, the Outbreak period will end 60 days later (July 31, 2021). Your deadline will arrive on January 27, 2022 – 240 days after the Outbreak Period.
If the national emergency does not end by one year after the original deadline prescribed by ERISA, then your appeal is due on that date, June 30, 2022 – one year and 180 days after your claim for benefits was denied.
An ERISA Disability Claim Procedure Process Cannot Jeopardize Your Health or Life
The Federal Register Notice announcing the new rule makes a special point to reiterate a portion of the already-existing Department of Labor Claims Procedure Regulation that applies to long term disability plans: “Plans may not have provisions that unduly inhibit or hamper the initiation or processing of claims for benefits.”
The Department of Labor Claims Procedure Regulation gives an example of what would unduly inhibit or hamper the initiation or processing of claims for benefits:
The denial of a claim for failure to obtain a prior approval under circumstances that would make obtaining such prior approval impossible or where application of the prior approval process could seriously jeopardize the life or health of the claimant . . . would constitute a practice that unduly inhibits the initiation and processing of a claim.
This example in the Department of Labor Claims Procedure Regulation – that a claims procedure cannot seriously jeopardize the life or health of the claimant – seems especially apt given the pandemic. For example, disability insurers will commonly require an “independent” medical examination when reviewing a claim. However, it can be argued that a claimant undergoing said examination could create unnecessary exposure to COVID-19. Since an ordered examination may jeopardize your health, that practice may be prohibited.
Where to Find More Information
The March 2020 Federal Register Notice can be reviewed here.
The February 2021 Department of Labor Notice can be viewed here.
You can also view the Department of Labor’s Frequently Asked Questions.
There continues to be a great deal of uncertainty surrounding COVID-19 right now. Things are changing and developing quickly. If you’re wondering about how your short- and/or long-term disability benefits may be affected, you should consult with a long term disability attorney for guidance. The ERISA attorneys at Riemer Hess LLC have been providing critical guidance to claimants like you for 25 years. Call us to learn more about your options and get the guidance you need.