Disability Insurance Lawyer Blog

ALLEGATIONS OF MASSIVE DISABILITY FRAUD BY LONG ISLAND RAIL ROAD (LIRR) EMPLOYEES

According to news reports, eleven employees of the Long Island Rail Road (LIRR), including two doctors and seven retirees, are just the tip of the iceberg of a disability fraud scheme that has the potential to cost the Metropolitan Transit Authority (MTA) as much as $1 billion. The alleged scheme took advantage of a massive mess of federal regulations, union work rules and contracts.

The New York Post calls the scam "...so breathtakingly huge that calling it a massive fraud scheme is a gross understatement."

We all know that the Post is given to hyperbole, but in this case, we agree that it is well deserved.

More to the point for our readers: What will this case mean for the ill and injured employee who files a claim for disability insurance benefits? Expect some additional skepticism from any claims reviewers in the New York-metro area, and for claimants in general. If this story grabs the attention of the national media, there may be a temporary shift as disability insurance companies get on the bandwagon.

We don't have a crystal ball, so we can't be sure what the long-term fallout from this case will be, both in the New York-metro area where it takes place or nationwide. Nonetheless, it is troubling to hear about this widespread abuse of the process, and its potential implications for those legitimately disabled and impaired from working.

If you are concerned about the implications of this case and your own disability claim has been denied or is being delayed, give our office a call. We talk to people just like you every day, and we understand how overwhelming this situation is. We can help.

Professional Practices and Disability - Financial Records Disclosure

With the exception of an IRS audit, few requests for information are as unpleasant as a letter from the disability insurance company asking for complete financial disclosure.

If the disability insurance payments are based on practice income, in the case of a claim for partial disability or residual disability benefits, the request for financial disclosure does not seem out of order; how else will the disability insurance company determine the correct payment amount? But this isn't usually the case. Where a claim is for total disability, however, it may be that the request for such financial disclosure is both onerous and improper.

Most disability insurance policies sold to professionals contain clear language about the amount of monthly benefits to be paid, with no reference to the financial statements of the individual personally or professionally. So why are the insurance companies asking for documentation of your income, details of your expenses, and more information than the IRS is entitled to?

If you have filed a claim and the insurance company has requested a complete set of your financial records, here are steps you can take to protect yourself:

1 - Find your original disability insurance contract and read it. Locate the section that discusses financial disclosure. This is often governed under a section of the policy called Proof of Loss. If there's language in there you don't understand or that doesn't make sense to you, call an experienced disability insurance law attorney. You may have to provide some records - but it is unlikely that you have to provide everything.

2 - Determine for yourself, or with the assistance of representation, what information is truly appropriate and/or necessary for the insurer to consider your claim properly. Do not permit an insurer to brow beat or intimidate you into disclosing more information than would be appropriate.

3 - If you are required to provide practice information, make sure that your office records are up to date and complete. Check with your CPA, bookkeeping service or comptroller, to ensure that the records are fully compliant with local, state and IRS requirements. If there are any questions regarding tax issues, the insurance company may not care - but some of their own documentation searches could set up a red flag for local, state or federal agencies. Be prepared to back up your methods of recordkeeping.

if you have questions about financial disclosure, call our office to learn how we can help.

COUNCIL FOR DISABILITY AWARENESS - TO INFORM AND EDUCATE... Maybe

The 2011 Council for Disability Awareness Long-Term Disability Claims Review is an annual review of LTD claims by the Council for Disability Awareness - an association of fourteen of the largest Long Term Disability insurance companies. The study looks at claims data gathered by the organization from 2010, seeking to identify continuing and new trends.

Despite the fact that these types of studies tend to be self-serving, we thought there were some interesting facts emerging:

From 2009 - 20010, claims payments increased by 1% - but 56% of all participating companies reported an increasing number of claims. That tells us that more people are making claims, but fewer are being paid. That's what we are seeing in our office, and we haven't done a survey.

0.6% fewer employers offered group long term disability insurance in 2010 compared to 2009. That sounds like most companies are doing what they can to continue to provide this benefit. Disability insurance is an important benefit for anyone who gets a paycheck.

Musculoskeletal system and connective tissue diseases continue to be the leading cause of new disability claims approved during 2010 - about 30%. Our office receives a lot of calls from people with back, neck, shoulder and joint disabilities, so we are not surprised to read that.

Finally, we were dismayed to read, way at the bottom of the survey, that the companies that participate in this survey "may vary from year to year" - and that "some companies may adjust prior years' data." Our favorite bit of obtuse insurance company-style language:

For these reasons, year-over-year comparisons within each year's claims
review are valid; however, comparing some data within the 2011 report to
data in prior years' reports may not be valid.

If you are having trouble making sense of your long term disability insurance policy, call our office today to find out how we can help.