Erisa and Disability Benefits Law Blog

The Boeing Company spread the wealth a little last week. Based on its stock price on Friday, the company will pay bonuses to thousands of its current and former employees. Employees with at least four years of service will receive approximately $5,400 in stock. According to the Seattle Times, "Boeing established the stock-bonus program in 1996. It was designed to reward workers every two years if the company's stock price rose more than 3 percent a year. Two years ago, employees received their first bonus. In 2004, a worker with four years of service received 17 shares worth nearly $900."

One of the questions being asked these days is, "Can my employer slash my pension benefits?" This is a complicated question that involves several factors, including the applicable plan language. The Employee Benefits Security Administration, a component of the Department of Labor, has posted a response to this question on its website and addressed some of the basic issues. Click here to access that site.

If you ever wanted to know more about a wide variety of health issues confronting Americans, I've got just the book for you. It is entitled, "Health, United States, 2005: With Chartbook on Trends in the Health of Americans" and is published by the federal government's National Center for Health Statistics. Included in its 550 pages is information about health care utilization and expenditures, suicide, disability, fertility and mortality rates, life expectancy, and dozens of other topics. Click here to access the complete book.

The Supreme Court's decision in Sereboff strongly impacts the law of ERISA reimbursement. In its decision, the Supreme Court expanded the scope of "appropriate equitable" relief available to ERISA plans in claims for reimbursement. Click here to read a blog entry by law professor Colleen Medill analyzing the decision. As Prof. Medill points out, there are still unanswered questions on this topic despite the Court's attempt to simplify the law.

The National Institute on Deafness and Other Communications Disorders (NIDCD) has a useful website focusing on communication disorders. These include deafness, balance problems and Meniere's Disease, speech and voice conditions, and other disorders. The site contains useful information on research, treatment options, and other topics. Click here to reach the website.

Let's get the week started with a humorous look at pension reform. Ed Stein of the Rocky Mountain News offers this editorial cartoon about the much-criticized attempts by Congress to shore-up our federal pension system.

The Department of Labor has posted a long list of articles pertaining to employee benefits on its website. Examples include "Employer Bankruptcy: How Will it Affect Your Employee Benefits?"; "Protecting Pension and Health Care Benefits after Job Loss"; "Top 10 Ways to Make Your Health Benefits Work for You"; "Taking The Mystery Out Of Retirement Planning"; and "Reporting And Disclosure Guide For Employee Benefit Plans." There are many others posted. Click here for the relevant page on the Department of Labor website.

I recently game across The Employee Benefits Legal Resource Site maintained by Carol Calhoun. It contains a well organized resource library with a number of useful tools for attorneys handling ERISA cases. It includes, among other things, a cross-reference chart matching ERISA sections with their coorisponding U.S. code citation (including hot links to the text of both), and links to a number of governmental and non-governmental ERISA resource sites. Thanks to Carol for making this helpful site available to the ERISA legal community.

I ran across this article on ERISA pension law on findlaw.com. It provides basic information on a variety of pension topics. It describes the primary differences between defined benefit plans, defined contribution plans, 401(k)plans, SEP plans, ESOP plans, and other ERISA-governed plans. The article also discusses the requirements for disclosure of information by plans under ERISA.

United Policyholders is a non-profit organization dedicated to educating people about insurance issues and consumer rights. In addition to its educational role, United Policyholders "receives frequent invitations to testify at legislative and other public hearings, and to participate in regulatory proceedings on rate and policy issues. UP responds to marketplace developments such as sudden price increases, unavailability or large-scale non-renewals by educating the public on consumer options. UP's "Match-UP" program which was supported by the City of Oakland, California to solve a sudden crisis in homeowners insurance availability and affordability is an example of one such project.

The UP website quoted above provides a great deal of useful information for consumers. It addresses insurance claims, legislative matters, pertinent web links, and many other topics.

Many employers offer severance benefits to departing employees. Severance benefits are commonly offered when layoffs or company downsizing occurs. In this article from Career Journal, the author gives some tips for negotiating a fair severance package.

If an employee has a pending claim for disability or other employee benefits against the employer, the employee should not unwittingly waive the claim for those benefits under the language of the severance agreement. ERISA plans sometimes argue that a claim for disability benefits, for example, is barred because the employer signed the standard severance agreement waiving all claims.

The National Association of Insurance Commissioners has a great website that provides all sorts of useful information for consumers. The site regularly posts "Consumer Alerts" concerning developments in the world of insurance. Current "Consumer Alerts" discuss the Medicare prescription drug program, fraudulent health care plans, and privacy issues. Click here to read more.

Employees are naturally concerned when they learn that their employer is filing for bankruptcy. One of the first questions asked is, "What's going to happen to my benefits?" The federal government has a website that provides information on this very question, particularly in the context of pension and health benefits. Check it out here.

Much has been made lately of the attempts to reform the federal pension system. Without reform, it is likely that more and more corporations will not be able to meet their defined benefit pension obligations. With good reason, major newspapers have harshly criticized President Bush and the Congress for failing to take responsible steps to safeguard the pension system.

There is a Department of Labor website that provides information about the Bush Administration's position on pension reform issues. The site includes "fact sheets" and summaries, testimony, speeches, press releases, and budgeting materials.

The pension plans of government employees are not governed by ERISA. Nonetheless, you can find basic information about public pension plans at freeerisa.com. There is a section (entitled "Public Pension Funds") that provides membership and financial data on government pensions. For example, the Tennessee Consolidated Retirement System has over 188,000 members and assets of over $22 billion.

This is just piece of information provided by freeerisa.com. Anyone who wants to find out more information about employee-benefit plans offered by employers should register (for free) with that website.

One of the purposes of ERISA is to ensure basic fairness to plan participants. The statute requires persons or entities that exercise discretionary authority over plan administration to satisfy fiduciary duties. Fiduciaries must act reasonably in administering the plan consistent with the provisions of ERISA and the applicable plan. Fiduciaries who fail to meet their duties may be sued under ERISA.

Read more about ERISA fiduciaries at this U.S. Department of Labor website.

Sleep apnea is a serious medical condition that, in many cases, limits a person's ability to work. The American Sleep Apnea Association summarizes this condition as follows:

Obstructive sleep apnea (OSA) is caused by a blockage of the airway, usually when the soft tissue in the rear of the throat collapses and closes during sleep. In central sleep apnea, the airway is not blocked but the brain fails to signal the muscles to breathe. Mixed apnea, as the name implies, is a combination of the two. With each apnea event, the brain briefly arouses people with sleep apnea in order for them to resume breathing, but consequently sleep is extremely fragmented and of poor quality.

Sleep apnea is very common, as common as adult diabetes, and affects more than twelve million Americans, according to the National Institutes of Health. Risk factors include being male, overweight, and over the age of forty, but sleep apnea can strike anyone at any age, even children. Yet still because of the lack of awareness by the public and healthcare professionals, the vast majority remain undiagnosed and therefore untreated, despite the fact that this serious disorder can have significant consequences.

This website provides excellent resources for anyone who suffers from this condition.

Did you know that ERISA often rears its head in divorce proceedings? This happens during the court-ordered division of benefits under an ERISA-governed pension plan. Pension benefits are sometimes the most valuable marital asset involved in a divorce. Pursuant to ERISA and the IRS code, courts can enter Qualified Domestic Relations Orders to create or recognize a spouse's right to receive some or all of the plan participant's pension benefits. Therefore, through the entry of a Qualified Domestic Relations Order, the spouse of a plan participant can continue to be covered by the plan even after the divorce.

Check out this U.S. Department of Labor website to learn more about Qualified Domestic Relations Orders.

There are occasions where an insurance carrier wishes to settle a disability claim by "buying-out" the carrier's obligations under the policy. In those occasions, the insurance carrier generally pays a lump sum to the claimant in exchange for a complete surrender of rights under the policy.

As a starting point for settlement negotiations, the parties often try to determine the present value of the disability claim. To arrive at this figure, any past-due benefits are added to the present value of the future benefit stream. For example, if there are still 120 future monthly payments available under a disability policy at the time of settlement, the parties will try to calculate the present value of those 120 future payments as part of the overall analysis. The present value of those payments is obviously less than the sum of the 120 payments themselves.

There are several commercially available calculators that compute the present value of future payments. I have also found a few free calculators on the internet. I am attaching one of these calculators that may assist lawyers and their clients calculate the present value of future payments.

In this LA Times story, the reporter profiles a saleperson, Debra Potter, who made a great living selling disability policies. She thought she was providing a safety net for people. Then, Ms. Potter became disabled herself. Unfortunately, she learned firsthand how ERISA favors insurance companies rather than disabled claimants. This is a very educational article for anyone interested in ERISA.

Yesterday, I posted the website of the Pension Benefit Guaranty Corporation (PBGC), a federal body created to help protect the pensions of millions of Americans.

Today, I am posting the website for the Employee Benefits Security Administration (EBSA), a component of the U.S. Department of Labor. According to that website, the purpose of the EBSA is to educate and assist "the 150 million Americans covered by the 730,000 private retirement plans and six million private health and welfare plans and the plan sponsors and members of the employee benefits community. EBSA promotes voluntary compliance and facilitates self-regulation, working diligently to provide quality assistance to plan participants and beneficiaries. It is the policy of EBSA to provide the highest quality of service to its customers."

In addition to providing information about pension and welfare benefits, the EBSA provides individualized assistance to plan participants. This includes providing participants with available plan documents filed with the Department of Labor.

The EBSA website has a lot of good information about pension and welfare benefits. Check it out here.

The Pension Benefit Guaranty Corp., known as PBGC, is a federal body created by the ERISA statute. It purports to protect the "pensions of 44.4 million American workers and retirees in 31,200 private single-employer and multiemployer defined benefit pension plans." Its operations are partly financed by insurance premiums fixed by Congress and paid by sponsors of the pension plans. PBGC "pays monthly retirement benefits, up to a guaranteed maximum, to about 518,000 retirees in 3.479 pension plans that ended." PBGC does not guarantee health and welfare benefits, severance benefits, and certain other benefits.

To learn more about PBGC, check out its website.

The Department of Labor has a comprehensive website devoted to health plans and benefits. Topics include HIPAA, health benefit claims and appeals, medical child support, health benefits education campaign, and recent changes to health care law. Click here to view the site.

It's hard to believe that 15 years have passed since the passage of the Americans with Disabilities Act. The Act has helped promote and protect the rights of disabled citizens in our country. To learn more, read the website of the U.S. Department of Justice that addresses this important legislative achievement.

Spinal-related injuries and degeneration are responsible for a vast number of disabilities each year. One common procedure used to treat intravertebral disc problems is fusion surgery. In that procedure, the disc is removed and the adjacent vertebrae are fused together. While helpful to many, this surgery has sometimes been associated with other problems, such as accelerated degeneration of other vertebrae.

As an alternative, a limited number of surgeons are now performing artificial disc replacement surgery. The Charite artificial disc (offered by a subsidiary of Johnson & Johnson) has reportedly been used with success with certain patients. As the manufacturer concedes, this procedure is not for everyone. Read more about this procedure here.

Brain injuries, especially mild traumatic brain injuries, are often misunderstood and minimized. In reality, these injuries can greatly reduce the ability to concentrate, analyze, multi-task, focus, recall information, and other things. Thousands of people are disabled in America due to brain injuries.

Here is one good website that provides information to brain injured patients and their families.

Meniere's Disease is one of the most unbearable medical conditions around. It is characterized by a number of symptoms, including vertigo, inner ear pressure, tinnitus, and hearing loss. People who suffer from Meniere's Disease are very often unable to work in any capacity. Click here to learn more about this disease.

Chronic pain is one of the leading causes of disability. Click here to learn more about pain, including treatment, research, and management.

In an age where employers routinely default on pension obligations and slash health benefits, it's refreshing to see that at least one large company is not following the herd. Read more in this New York Times article about the pro-employee attitude that is helping Costco beat WalMart.

Back injuries force thousands of people to leave work on disability each year. Find out more about issues relating to back injuries, including treatment, research, and prevention on this comprehensive website from the National Library of Medicine and the National Institutes of Health.

The website for the National Association of Insurance Commissioners provides quick access to the websites for all the state insurance departments nationwide. Click here for more information.

The federal government has launched a website, DisabilityInfo.gov, that purports to connect "people with disabilities to the information and resources they need to pursue their personal and professional ambitions - delivering on America's promise of equal access to opportunity for all citizens."

The website addresses areas such as education, transportation, housing, income support, civil rights, and employment.

The Family & Medical Leave Act allows eligible employees to take up to 12 weeks of unpaid time off from work in certain circumstances (including the employee's own serious health condition). Click here to learn more about this federal statute.

As far too many people know, fibromyalgia can be a severe and debilitating illness. According to the website of the National Fibromyalgia Association (NFA), the disease is an "increasingly recognized chronic pain illness which is characterized by widespread musculoskeletal aches, pain and stiffness, soft tissue tenderness, general fatigue and sleep disturbances. The most common sites of pain include the neck, back, shoulders, pelvic girdle and hands, but any body part can be involved. Fibromyalgia patients experience a range of symptoms of varying intensities that wax and wane over time." The NFA reports that approximately 3-6% of the American population suffers from fibromyalgia. It tends to strike women at a higher rate.

The NFA also confirms that fibromyalgia is "characterized by the presence of multiple tender points and a constellation of symptoms." The most common symptoms are widespread and chronic pain. In addition, fibromyalgia patients tend to suffer fro m fatigue. The NFA website states that the fatigue of fibromyalgia "is much more than being tired. It is an all-encompassing exhaustion that interferes with even the simplest daily activities. It feels like every drop of energy has been drained from the body, which at times can leave the patient with a limited ability to function both mentally and physically."

Despite the horrible consequences of fibromyalgia, disability insurance carriers often refuse to pay disability benefits relating to the disease. Instead, carriers frequently argue that fibromyalgia is not a real illness or that its diagnosis relies too much on subjective complaints of the claimant. In my opinion, the key to pursuing a disability claim based on fibromyalgia is to carefully document the illness and its impairments on daily life. Medical literature can be submitted to support the position that fibromyalgia is a real and disabling illness. Finally, doctors (including board-certified rheumatologist) use certain guidelines established by the American College of Rheumatology, including the location of tender points, to help diagnosis the disease.

To learn much more about fibromyalgia, its possible causes, and potential treatment, and other related issues, I have attached this link to the NFA website.

Each year, ERISA pension and welfare benefit plans must submit reports to the federal government regarding their finances, income, investments, and other matters. An ERISA plan can typically satisfy this obligation by filing a "Form 5500" with the U.S. Department of Labor. According to the Department of Labor's website, "The Form 5500 Series is part of ERISA's overall reporting and disclosure framework, which is intended to assure that employee benefit plans are operated and managed in accordance with certain prescribed standards and that participants and beneficiaries, as well as regulators, are provided or have access to sufficient information to protect the rights and benefits of participants and beneficiaries under employee benefit plans.

Form 5500s provide abundant information for plan participants and their lawyers, including the types of benefits offered in a certain year, the names of the plan and the plan administrator, and the identity of insurance carriers that agree to provide benefits.

There is a terrific website, called "freeerisa.com," that anyone can use to discover information about pension and welfare benefit plans. The website allows access to the Form 5500s filed by all plans. How do you use the Form 5500 information? Here's one example: If a claimant wishes to obtain her disability benefit plan, she is entitled under law to request a copy from the plan administrator. If the plan administrator fails to provide the documents within 30 days, certain penalties may apply. By using freeerisa.com, the plan participant or her lawyer can identify the correct person or entity from which to request the plan documents from the plan administrator. Then, there is no dispute about whether the claimant requested the documents from the right source. I recommend making this request via certified mail. Form 5500s are also helpful when determining the correct parties to sue in the event of benefits denials.

The website is free, but requires a user name and password. Registration is quick and easy.

According to the Chartbook on Disability in the United States, approximately 24.1 million Americans have a severe disability and another 24.8 million have a disability characterized as not severe. According to this resource, almost one out of every seven people has an activity limitation. On online version of the Chartbook can be found here.

The Chartbook, which was prepared using data from various federal agencies and organizations, provides a fascinating overview of disability statistics in America. For example, the book states that the most frequently reported cause of work limitation is heart disease (10.9% of all conditions cited as causing work limitation), followed by orthopedic impairment at the back or neck (10.5%), intervertebral disc disorders (7.8%), osteoarthritis and allied disorders (6.8%), and orthopedic impairment of the lower extremities (4.5%).

The book was written by L. Kraus, S. Stoddard, and D. Gilmartin for InfoUse, a company in Berkeley, California with funding from for the U.S. Institute on Disability and Rehabilitation. InfoUse states on its website that it uses "information, technology, and participatory research to improve community equity, access and outcomes. Our planning work in disability, employment, independent living, and health empowers people to make personal and systems changes."