Plaintiffs seeking recovery of group disability benefits under ERISA-governed plans routinely argue that claim fiduciaries failed to adequately consider and/or account for decisions by the Social Security Administration (SSA) to award Social Security Disability Insurance (SSDI) benefits. As a result, federal courts are regularly tasked with evaluating the substance and sufficiency of discussions of SSDI awards (that are made a part of the administrative record) in adverse benefit determination letters. Continue Reading Third Circuit Clarifies Sufficiency Of Discussions Of Social Security Disability Insurance Awards In Adverse Disability Benefit Determinations Under Pre-2018 ERISA Claims Procedure Regulation

In 2010, Chief Justice John Roberts observed that that ERISA is “an enormously complex and detailed statute.” Conkright v. Frommert, 559 U.S. 506, 509 (2010).

Some things don’t change. A recent decision out of the District Court of New Jersey exemplifies how even the most seemingly mundane procedural act — removal — implicates legal nuances with which courts continue to grapple. Continue Reading D.N.J. Rejects Plaintiff’s Fee Request In Connection With State Court Remand Of Action Removed Under ERISA, Scaling Back Earlier Charge That Defendant’s Removal Was Nonsensical

Below is an excerpt of an article that has been published in the ERISA Report, the semi-annual newsletter issued by the Defense Research Institute (DRI) Life, Health and Disability/ERISA Committee.

What happens when COBRA meets COVID-19? While it may sound like the premise of a horror movie along the lines of “Snakes on a Plane” or “Sharknado,” extensions of COBRA notice deadlines due to the pandemic have the potential to be a fright fest for group health plan administrators and third-party administrators (TPAs). Read the full article.

In Rutledge v. Pharmaceutical Care Mgt. Assoc., — U.S. –, 2020 WL 7250098 (Dec. 10, 2020), the Supreme Court held that ERISA’s broad express preemption will not reach a state law that focuses on the price of prescription drug benefits that a plan chooses to provide.

The particular question in Rutledge was whether ERISA preempted an Arkansas law regulating the price at which pharmacy benefit managers (PBMs) reimburse pharmacies for the cost of drugs covered by ERISA prescription drug plans. The Court described PBMs as

a little-known but important part of the process by which many Americans get their prescription drugs. Generally speaking, PBMs serve as intermediaries between prescription-drug plans and the pharmacies that beneficiaries use. When a beneficiary of a prescription-drug plan goes to a pharmacy to fill a prescription, the pharmacy checks with a PBM to determine that person’s coverage and copayment information. After the beneficiary leaves with his or her prescription, the PBM reimburses the pharmacy for the prescription, less the amount of the beneficiary’s copayment. The prescription-drug plan, in turn, reimburses the PBM.

Continue Reading Supreme Court Rules that ERISA Does Not Preempt State Law Regulating PBM Reimbursements

In Cook v. Life Insurance Company of North America et al., No. 3:20-cv-139, the plaintiff, Robert Cook, sued Life Insurance Company of North America (LINA), and its indirect corporate parent, Cigna Corporation, for denial of long-term disability benefits under the Employment Retirement Income Security Act of 1974 (ERISA). Cook lived in Tennessee (and his lawyer was located there), his employer/plan sponsor was based in Florida, and LINA, the insurer, was located in Pennsylvania. Nevertheless, Cook brought suit in Connecticut, alleging venue was proper because he had also sued LINA’s indirect parent, Cigna Corporation, which is a Connecticut corporation. Continue Reading Connecticut District Court Enforces ERISA Venue Provisions and Dismisses Lawsuit with No Connection to Connecticut

Excerpt of a contributed article published by DRI in the August 2020 issue of For The Defense.

As the new coronavirus (COVID-19) spreads within the United States, questions arise over the potential effect that it may have on private group health and disability plans during and after the current pandemic. This article discusses recent federal legislation and directives in response to growing concerns regarding the coverage of (and cost-sharing for) diagnosis and treatment of COVID-19 under group health plans and analyzes possible developments for claims seeking long term disability benefits following the pandemic. Read the full article.

Those involved in disability claims administration may wish to consider the potential impacts of the current global pandemic. In the current crisis, disability claims regulations may not be at the top of many peoples’ minds. However, insurers, plan administrators, and other involved in disability claims administration may wish to reevaluate the applicable Department of Labor deadlines and requirements in light of present pressures on medical personnel, persons with serious health problems, and business disruptions. Continue Reading Disability Claims Regulations and the COVID-19 Pandemic

As discussed in an earlier post on this blog, in Intel Corporation Investment Policy Committee et al. v. Sulyma, No. 18-1116 (Feb. 26, 2020), the U.S. Supreme Court addressed the statute of limitations for breach of fiduciary duty lawsuits under ERISA.  In general, fiduciary breach claims are covered by the 6-year statute of limitations in 29 U.S.C. § 1113(1).  However, there is a 3-year statute of limitations if the plaintiff had “actual knowledge” of the breach.  29 U.S.C. § 1113(2).  Writing for a unanimous Court, Justice Alito held that “actual knowledge” “does in fact mean what it says.”  According to the Justice, under this standard a plaintiff must be actually aware of the fiduciary breach – not merely have information from which he or she could have become aware of the violation – for the 3-year statute of limitations to start running.

The allegations in Sulyma may help plan sponsors, administrators, and other plan fiduciaries understand the impacts of Justice Alito’s opinion. Continue Reading Supreme Court’s Sulyma Decision May Complicate Plan Administrators’ Consideration of the DOL’s New Proposed Electronic Safe Harbor Disclosure Rule

Believe it or not, the Supreme Court of the United States just decided whether “to have ‘actual knowledge’ of a piece of information, one must in fact be aware of it.” The Court said “yes,” and it was unanimous. Most non-lawyers (and even some lawyers) would probably be surprised that this issue was even being debated. But it was a question that had divided the lower courts, with the Sixth Circuit ruling that “actual knowledge” did not require actually seeing or reading a document that was provided. The Supreme Court agreed with the six other circuits that had concluded that “actual knowledge” means what it says. The Court’s opinion potentially holds a silver lining for defendants though when it comes to class certification. Continue Reading Supreme Court Decision on ERISA Statute of Limitations May Help Defendants Defeat Class Certification

In Ariana M. v. Humana Health Plan of Texas, Inc., No. 18-20700, 2019 WL 5866677 (5th Cir. Nov. 8, 2019), the Fifth Circuit Court of Appeals rejected a plaintiff’s petition for attorneys’ fees under 29 U.S.C. § 1132(g).  This case concerns Humana Health Plan of Texas, Inc.’s denial of benefits for hospitalization to treat an eating disorder.  On a prior appeal, Ariana M. v. Humana Health Plan of Texas, Inc., 884 F.3d 246 (5th Cir. 2018) (en banc) (“Ariana I”), the Fifth Circuit concluded that the District Court erred by conducting a deferential review of the claim decision, that it remanded the case for a de novo review of Humana’s decision.

On remand and de novo review, the District Court found Humana had not erred and entered summary judgment in Humana’s favor.  Nonetheless, Ariana filed a fee petition, asserting that her success in Ariana I in convincing the appellate court to change the standard of review and remand her case entitled her to fees regardless of whether she ultimately won her claim for benefits.  The District Court denied her petition.

Continue Reading Remand Directing Change in Standard of Judicial Review Is Not Sufficient Success on the Merits to Support Attorneys’ Fee Award