Jul 25, 2014


3/29/2011
Brian S. King
Comments (0)

Bloomberg Markets: "ERISA Exploits Consumers!"

Bloomberg Markets examines how ERISA, a statute meant to protect consumers, actually exploints consumers

Category: Keyword Search: insurance tricks

12/31/2010
Brian S. King
Comments (0)

Insurers Have to Use the Correct Criteria in Evaluating Medical Necessity

It is an abuse of discretion to use the wrong criteria in evaluating the medical necessity of treatment for insurance purposes.

Category: Keyword Search: insurance tricks

8/27/2010
Brian S. King
Comments (0)

Judge Acker Speaks His Mind About ERISA

Judge Acker Speaks His Mind About ERISA

Category: Keyword Search: insurance tricks

5/10/2010
Brian S. King
Comments (0)

Delayed Claim for Prosthetic Leg

ERISA, delayed payment of insurance claim, prosthetic leg, Horizon Blue Cross Blue Shield

Category: Keyword Search: insurance tricks

7/30/2009
Brian S. King
Comments (0)

A few days ago I received a brochure from the American Conference Institute advertising their annual ERISA Litigation seminar.  In the past ACI has put on a good (albeit expensive) ERISA seminar each year.  I’ve presented at it in the past.  The difference in this year’s format is that ACI is presenting the seminar solely from a defense perspective.  It promotes the program by boasting a faculty that includes 28 in-house counsel from various insurers and large corporations along with 21 U.S. District Court judges from across the country. 

More troubling, however, are some of the topics the presenters will address.  One of them is “using the claims review process to set up, control and strengthen the defense.”  Another topic to be addressed is “anticipating claims when making the decision and preparing to defend it before the decision is made.”  You can take a look at the brochure yourself.  I’ve placed a copy of it in the website library here. 

Now maybe I’m being just a little sensitive in how I title this post but I don’t think so.  You see, the overriding concern of ERISA is that fiduciaries will be held to strict fiduciary standards.  The statute defines ERISA in broad terms.  Any person or entity that is charged with, or actually exercises, any authority, management or control over an ERISA plan or its assets is a fiduciary.  29 U.S.C. Sec. 1002(21).  It doesn’t matter whether the person is designated as a fiduciary under the plan documents or they simply act in a fiduciary capacity.  It doesn’t matter whether they are aware of their fiduciary status or intend to act as a fiduciary. 

In addition, the statute expressly states that ERISA fiduciaries must act solely in the interest of the ERISA plan’s participants and beneficiaries and for the exclusive purpose of providing them benefits.  29 U.S.C. §1104(a)(1)(A).   Various cases provide more information about the nature of these fiduciary duties.  One court referred to ERISA’s fiduciary duty standards as “the highest known to the law."  Donovan v. Bierwirth, 680 F.2d 263, 272, n. 8 (2nd Cir. 1982).  The Supreme Court referred to ERISA's fiduciary duty standards just last year as requiring “higher-than-marketplace” standards of conduct.  Metropolitan Life v. Glenn, 128 S.Ct. 2343, 2350 (2008).  This echoes the language of Justice Benjamin Cardozo many years ago when he described fiduciary duties in this way: 
 
Many forms of conduct permissible in a workaday world for those acting at arms length, are forbidden to those bound by fiduciary ties.  A trustee is held to something stricter than the morals of the marketplace.  Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior.  

Meinhard v. Salmon, 164 N.E. 545 (N.Y. 1928).   One of the most critical points at which these fiduciary duties apply is when insurers and plan administrators are evaluating whether to pay or deny a claim. 

What does it say about how seriously ACI and its presenters take ERISA’s fiduciary duty standards when they teach plan fiduciaries how they can “use the claims review process to set up, control and strengthen” defense of that claim in litigation?  When ACI advises lawyers and corporate officers about how they can “anticipate claims when making the decision and prepare to defend them before the decision is made,” it is doing nothing less than encouraging the breach of ERISA’s fiduciary duties. 

The ACI marketing brochure is testimony to what a sham ERISA’s fiduciary protections of participants and beneficiaries have become. 



Category: Keyword Search: insurance tricks

7/16/2009
Brian S. King
Comments (0)
Tom Tomorrow hits home.  h/t to Melody

Category: Keyword Search: insurance tricks

6/6/2009
Brian S. King
Comments (0)
One of my friends who, like me, often represents claimants in disability cases tells me that she received a letter from a Hartford employee whose title is now "Ability Analyst."  I love it!  We can have a contest to rename various positions, tools and functions within insurance companies to reflect the new nomenclature.  For example, letters terminating disability benefits can be referred to as "income opportunity notices."  Surveillance videotapes can now go by the term "enabling observations."  Insurance medical examinations and functional capacity evaluations would be "pre-employment interviews."  Try this on for size:

"We are excited to inform you that your pre-employment interviews and our enabling observations allow us, effective immediately, to provide you with this income opportunity notice.  Congratulations!  We wish you the best of luck in your new endeavors dealing with the additional adversities we are privileged to provide you!  Just remember that what does not kill you makes you stronger.  Warmest regards, Weluvu Insurance Co." 

Category: Keyword Search: insurance tricks