Navigating the Disability Insurance Maze
By Mark D. DeBofsky

As many people with CFIDS have learned, obtaining disability insurance payments can be as frustrating as the illness itself. The process is complex and fraught with numerous traps for the unwary. Yet despite what you may have heard or read, the majority of CFIDS claims are paid by disability insurers. What follows is some advice that may help you win your claim after you’ve been denied benefits.

In addition to Social Security disability, there are two types of disability insurance: long term disability (LTD), which is offered as a group plan through an employer or association; and disability income, which is purchased individually and provides a fixed monthly payment in the event of sickness or accident causing an inability to work. The type of insurance you have affects the steps you must follow after a claim has been denied. 

If you have individual disability insurance and your claim is denied, your case can be decided in a trial by jury. In some states, such claims may also include the possibility of an award of damages for “bad faith.”

Group disability, or LTD insurance, on the other hand, is usually governed by the ERISA law (Employee Retirement Income Security Act). Unless such insurance coverage is provided by a government or religious employer, the likelihood is that the ERISA law will apply. Under ERISA, there is no right to a jury trial and no claim for any damages whatsoever.

However, the ERISA law does offer an advantage — if a claim is denied in whole or in part, the statute entitles the claimant to a full and fair review. That review process is the key to victory.

Whichever course you must follow, the following information will help you navigate through the disability claim process — and will enhance the chances of success if litigation becomes necessary.

Collect your evidence
Most disability benefits cases, such as those involving cardiac conditions, spinal impairments or neurological disorders, are diagnosed or rated based on positive laboratory tests or radiologic evidence. CFIDS cases, however, present special challenges because there are no accepted lab tests or biological markers for the disease. That’s why it’s important to know what kind of secondary evidence holds sway in court.

Many people with CFIDS have dealt with Social Security disability and are familiar with Social Security Ruling (SSR) 99-2p. This ruling provides a framework for analyzing disability claims under the Social Security Act. Although not directly applicable to ERISA claims, SSR 99-2p uses concepts that the federal courts, which determine almost all ERISA cases, are likely to follow.

Recognizing there is as yet no clear cut objective proof of CFIDS, the Social Security ruling focuses on secondary proof that is of comparable value. Such proof includes consistent notations in physician records of low grade fevers, swollen glands and other physical abnormalities noted on examination. Proof also includes the claimant’s own regularly kept diary of symptoms, plus observations made by friends, family members or co-workers that might reflect on pre- and post-disability functioning.

Be sure to document the times you’ve had to miss significant family or social events such as weddings, funerals or reunions. Nothing precludes you from submitting such evidence or other documentation such as photographs and videotapes that depict disability and personalize your claim to the insurance company claim analyst.

The most important proof in any claim, though, is a well-supported opinion from the treating doctor. A growing trend in the case law is to give deference to the treating doctor’s opinion so long as the doctor has expertise and the medical opinions are not inconsistent with the other evidence.

In Regula v. Delta Family-Care Disability Survivorship Plan, 266 F.3d 1130 (9th Cir. 2001), the court ruled that the treating doctor’s opinions should have dictated the outcome of a disability benefits claim. Further, so long as the treating doctor has a well-established treatment relationship, and has experience in treating CFIDS patients, contrary opinions from insurance company reviewing doctors are subject to attack.

Several cases have challenged insurance company decisions rendered by non-expert non-examining physicians. The courts were critical of the insurance companies for failing to apply reasonable expertise in evaluating the claims either by having the claimant examined or by having a doctor versed with CFIDS involved in the claim review process.

Know the traps
Insurers may try to deny CFIDS claims based on grounds that sound persuasive but have not stood up in court. The best defense against this tactic is learning the case law and legal precedents. Here are three of the biggest examples:

• Lack of objective evidence.  Some disability insurers have denied claims due to a lack of objective evidence such as medical tests. But the majority of courts have disagreed with that conclusion. For example, the case of Mitchell v. Eastman Kodak Company, 113 F.3d 433 (3d Cir. 1997) ruled that a disability insurer could not deny a CFIDS claim due to a lack of objective evidence. The court ruled the insurance policy contained no such requirement; besides, it would defeat an insured’s legitimate expectations to impose such a condition since medical science is as yet unable to provide such proof.

Even where an objective proof requirement was contained in a self-insured plan, though, Intel Corporation was required to pay benefits on a CFIDS claim when the claimant provided objective evidence such as a positive Epstein-Barr virus test. The court ruled in Friedrich v. Intel Corp., 181 F.3d 1105 (9th Cir. 1999) that Intel improperly acted as the claimant’s adversary and wrongfully denied Friedrich the opportunity to prove disability based on CFIDS .

• Self-reported illnesses.  Some disability insurance policies try to limit the duration of disability payments in cases involving “self-reported” illnesses such as CFIDS. However, those provisions have so far not had a significant impact. The only reported decision on such a provision, Russell v. UNUM Life Insurance Company of America, 40 F.Supp.2d 747 (D.S.C. 1999), found a doctor’s detection of trigger points during the examination of a patient to constitute objective proof of fibromyalgia, thus taking the disorder out of the realm of a “self-reported” illness.
  

• Mental illness.  Insurers may attempt to characterize CFIDS as a psychiatric illness in order to limit claims, since disabilities due to mental illness are usually paid for a shorter duration than physical illnesses. This ploy has been rejected. The seminal case on that issue is Mongeluzo v. Baxter Travenol Long Term Disability Benefit Plan, 46 F.3d 938 (9th Cir. 1995), where the court ruled the insurer had to give equal consideration to CFIDS as the basis for disability, and could not insist that the claim could only be adjudicated as a claim involving major depression. Friedrich also rejected such an approach.

Stay vigilant
Even after you’ve won your case, you must remain on your toes. Here are two tactics insurers may try to “prove” that you don’t deserve continued benefits:

• Surveillance.  Insurers frequently use surveillance to see if the insured is engaging in activities inconsistent with claimed restrictions; however, rarely does surveillance justify the denial of benefits. So long as the medical evidence is consistent and the treating physician’s opinion unequivocal, the claimant should not have an excessive fear of losing benefits due to surreptitious surveillance.

An excellent example is Clausen v. Standard Insurance Company, 961 F.Supp. 1446 (D.Colo.1997) where the court properly noted that a couple hours of surveillance showing the claimant walking her dog and driving may only be indicative of the claimant having a good day and are not proof of ability to work over the course of an eight-hour day or 40-hour work week.

• Continuing disability reviews.  Another point to keep in mind is that once benefits are secured, absent significant medical improvement, the insurer will likely be required to maintain payments. The Regula case cited above, while not a CFIDS case, points out the difficulty in terminating benefits without proof of recovery from the condition causing the initial disability award. Another recent ruling, McOsker v. Paul Revere Life Insurance Company, 2002 279 F.3d 586 (8th Cir. 2002), reached the same conclusion that benefits must be continued if there is no new information undercutting the claimant’s ongoing disability.

Find an attorney
The comments above are by no means exhaustive, and the law varies from state to state. It is therefore important to secure experienced, competent counsel to assist in these cases. Finding such an attorney is often no easy feat because very few attorneys have specific experience in handling disability benefits cases; and even fewer are willing to take cases governed by the ERISA law.

However, with patience and recommendations from local support groups and on-line discussion groups, attorneys can usually be located who are willing to accept cases on either a contingency fee basis (fees are payable only if benefits are obtained). In other cases, you can pay an initial retainer fee and then pay the remaining fee on a contingency basis.

The crucial time to hire an attorney is not when litigation is imminent; instead, make sure you obtain representation no later than immediately after a claim is denied. The attorney’s participation in a pre-suit appeal is crucial to success because courts in ERISA cases often limit the evidence under review to the documentation contained in the claim file.

Further, because many ERISA cases are reviewed under a deferential standard which will reverse the denial of benefits only if the insurer’s decision is found to be arbitrary and capricious; i.e., irrational, an attorney’s guidance is essential in creating not just a winning case, which is often not enough, but an airtight case, which is essential to an award of benefits.

If ERISA does not apply, presentation of overwhelming evidence may lead to an award of punitive damages in those states that recognize bad faith claims. An experienced attorney can therefore be invaluable in analyzing the insurer’s decision and the evidence supporting the denial of benefits. Based on knowledge of prevailing case law, the attorney will suggest what would be the most persuasive evidence and create arguments to rebut the adverse finding. 

Stay positive
CFIDS disability cases can be more difficult than those for other conditions. But the burden is not insurmountable. Most judges appear sympathetic to a well-documented case, although some may be hostile those involving limited doctor visits and inconsistencies in the medical evidence.

CFIDS is a real medical condition, and should be treated by the courts in the same manner as any other medical condition. With good evidence and strong legal advocacy, the disability maze may be successfully navigated to victory.