It’s a great case. Not “great” for your potential client, of course – having a “great case” in our world means that they have a serious medical condition, and their doctors have said they should no longer be working. They contacted you because instead of paying their well-supported claim for disability benefits, the disability insurance company denied their short term disability (STD) and/or long term disability (LTD) claim. Instead of the income replacement check they need, they are holding a denial letter that makes you both mad as heck and ready to fight.
But here’s the thing: fighting every single wrongful disability denial is a lot like treading water. It can be hard work, and from a business perspective, it often gets you nowhere. Tread water too much, and you’re at risk of drowning. That helps no one, including the client who was counting on you to add value to their case. Let’s take a closer look at how this happens, because this is where Insurance Appeal Consultants can help you both.
Virtually all disability insurance attorneys offer full representation to their clients on a contingent-fee basis. This means you step in as the client’s authorized representative with the insurance company and take over all communication regarding their claim. Contingent fee representation also means that you only get paid if you ultimately recover some money for the client, either by winning the administrative appeal to the insurance company, or by winning or settling the lawsuit you file when you lose the appeal. Most firms who take on this level of work and risk do so in exchange for a significant percentage of benefits, usually around a third, for some length of time – often as long as the client remains on claim, sometimes up to retirement age – while you manage new requests (and new attempts to close the claim again) from the insurance company.
For many clients, this is a win-win model. The client pays nothing up front, they still have a meaningful benefit left after your fee, they are done dealing directly with the insurance company (a HUGE relief for most clients), you are able to keep them on claim for as long as they remain disabled, and you ultimately recover fees that more than cover your costs. But it doesn’t always work out that way, especially the part about recovering your costs (which only keep rising the longer the client stays on claim). Here are some of the reasons why:
- Being an Authorized Representative is a lot of work. When you notify the insurance company that you are now representing your client, they stop communicating with your client and start communicating directly with you. And they often have a lot to say, sending you the complete claim file plus new requests for medical records, new reports to comment on, new forms for your client to fill out, etc. You can’t miss a beat, because the insurance company is especially eager to close the administrative record of the claim before you’ve necessarily added all your additional information.
- You have to review the claim file. The disability insurance company is supposed to give all their reasons for denying a claim in the denial letter. The denial letter guides the appeal. But the claim file has all their supporting documentation that gives more context (which often includes more “context” than they wanted you to know) for how they arrived at their decision to deny the claim. Although the larger context almost never changes what you need to do for the appeal, if you’re acting as an authorized representative, you need to know it. You cannot adequately represent someone if you don’t know everything the insurance company knows about their claim. Getting, reviewing and reporting on the claim file is a significant investment – even when it changes nothing about how you approach the appeal.
- You have to collect additional evidence. No matter what smoking guns you find in the claim file, they never change the fact that you need to add additional evidence for the appeal. You may need additional medical records, new test results, and information from the Social Security Administration (SSA) about an SSDI claim, among other things. When you are making third-party requests for these things, the process can be even slower, more complicated and more expensive.
- You have to continue to respond to the insurance company. Best case scenario for your client, you win the appeal, and they are back on claim. Especially if you are still collecting a percentage of their monthly benefits, you continue to represent them with the insurance company. Even for the most well-supported claim, this means at least annual claim updates. You need to triangulate between the insurance company, the client, and the doctors who support the claim to ensure medical records are up-to-date and forms are filled out correctly. And you have to do this as often as the insurance company says so, because the bar for what constitutes a “frivolous request” for proof of claim is set so high,no one seems to have actually seen it yet.
- You may have to submit additional appeals. The insurance company knows how to wear down your client and their doctors with endless requests for additional information. The stakes are high: one form that says “Sitting: Unrestricted” can wreck the whole claim (even when what the doctor meant by “sitting” is a far cry from “able to sit at a desk, working”). If that happens, you’re back to square one, facing a new administrative appeal. Of course, you aren’t charging the client anything additional – when you’re already collecting a percentage of their benefits, handling new appeals is part of the job.
- Case value is a moving target. Virtually every disability insurance policy includes offsets for other income the client receives due to their disability, such as SSDI, disability retirement benefits, and more. While your client may not be receiving these benefits when their claim is first denied, after you win the appeal, you might be surprised that due to new offsets and overpayments that arose while you were working on the appeal, the back benefit amount is zero or worse, and the ongoing monthly benefit is as low as the policy minimum. At the happier end of the spectrum, maybe your client has been able to return to work in some capacity. The actual recovery in their case may be limited to a few weeks or months of benefits, or even non-monetary relief (in the form of reinstatement of the leave they used to cover the period when their claim was denied).
No matter how it happens, when your fee is 1/3 of nothing, and you’ve put in the considerable work to win the appeal and especially when you are still managing the claim, that’s when treading water turns to sinking fast. The client loves you, but you’ve just lost money by winning the administrative appeal.
If cases like these were the minority, it might make sense to handle them anyway. The client doesn’t really care about the ins and outs of case economics. They just know they need help with their appeal. And what happens if you lose the appeal? Ironically, that same case often becomes a good investment for you as it moves to litigation (how’s that for a potential conflict of interest?). Most cases settle for a percentage of the total potential value of the claim. Even at a minimum monthly benefit, claims that are expected to last until retirement can yield a meaningful lump sum settlement amount for both you and the client. If the case doesn’t settle, and you secure a remand or win outright in court, the judge can order the insurance company to pay for the work you did in litigation. Those fee awards can be more than the total value of the claim.
Of course, you can’t add any new evidence in litigation. So that litigation case only has value if the administrative appeal was strong. And you and the client both know they have a much better chance of building a strong administrative record if you managed the appeal.
Well, until now. This is where Insurance Appeal Consultants can help. The fact is that these cases are NOT the minority. For many firms, up to 80% or more of all potential clients will have a case that does not make economic sense for your firm at the administrative appeal stage. This includes cases where:
- the claim is for Short Term Disability benefits only;
- the “own occupation” date for the Long Term Disability claim is fast approaching and there is currently no medical support for an “any occupation” claim;
- SSDI was recently approved, and you know there will be a large overpayment that will wipe out the LTD back benefits and then some;
- the monthly benefit amount after offsets is just a few hundred dollars or less;
- the client is nearing retirement age;
- And so many more…the list of reasons why a case does not make sense for contingent fee representation at the appeal stage is long and varied.
But the client doesn’t share the same perspective on their claim. That $300 monthly benefit after offsets helps pay their mortgage. Restoring that leave balance can help bridge them to a new FMLA claim so they can keep their job while they fully recover. Their doctor may well support their “any occupation” claim after some new test results are in. And it may be hard to quantify, but they know they’re not ready to give up on this claim. They want to give the appeal their best shot, even if it’s a long shot, even if the claim is relatively “low value.” It’s the principle, and to sleep at night they need to see it through.
Refer these cases to Insurance Appeal Consultants. We offer several free and low-cost services to help clients navigate the appeals process with advice and assistance, not full representation. Instead of sending the client on what you know is going to be a futile search for an attorney who will take the case you didn’t want, send them to someone who really can help them with their appeal. If they win the appeal, they get to keep their full benefit, even if that’s small, even if it’s in the form of non-monetary relief like restoring their leave balance. If they lose the appeal, we’ll refer them back to you – with a robust administrative record – to take another look at the case to see if it makes sense for litigation.
Here are three recent success stories that illustrate when Insurance Appeal Consultants can be the right choice to help with the administrative appeal:
- Lisa got her LTD “Own Occupation” denial letter about a week before she got her SSDI approval letter. Lincoln, her LTD insurance company, had referred her to one of their minions for “help” with her SSDI claim. When SSDI was approved, the minion told Lincoln right away. Lincoln unsurprisingly maintained their LTD denial (“our definition of Disabled is not the same as the Social Security Administration’s…” yada yada) – but also wanted tens of thousands of dollars back due the “overpayment” created by SSDI approval. Lisa was referred to Insurance Appeal Consultants by a local attorney who knew that with the overpayment and SSDI offset looming over the claim, the economics just were not a fit for contingent fee representation. We coached Lisa and her doctors through the steps to build a strong “own occupation” appeal, which Lisa won. She was able to resolve the overpayment dispute with Lincoln, and we guided her on what information she’ll need to provide to keep the claim supported into the “any occupation” period.
- Thomas stopped working and his STD claim was approved. When he tried to return to work part-time, MetLife closed his claim. When his symptoms flared again a few weeks later, instead of reopening his STD claim, MetLife said this was a new disability and opened a new claim, which required Thomas to satisfy a new Elimination Period. He contacted an attorney who referred him to us. We were able to help him get the second claim extended until he had fully recovered and was able to return to work. Then, we helped him appeal the first denial by using medical records and journal articles to show the second claim was really just a continuation of the first. His employer restored all the leave he had used between the two claims, including for the second, unnecessary, Elimination Period. If his full recovery does not go according to plan, we showed Thomas what he’ll need to do to provide proof of claim for a Long Term Disability claim.
- Jennifer had already returned to work by the time she was referred to us for help with her STD appeal to NY Life. She had no idea where to even start and was overwhelmed by trying to figure out an appeal and manage returning to work without exacerbating her symptoms. We were able to give her and her doctors the guidance they needed to explain why NY Life was wrong about her claim. She forwarded all the documents she collected and we added them to her appeal so she just had one file to send to NY Life. She won the appeal, and has since referred a colleague to us with a similar issue.
Other Insurance Appeal Consultants clients have told their stories about working with us at https://insuranceappealconsultants.com/our-clients-say/. And their appreciation often extends to the firm that referred them. Here’s what one client said in a 5-star review for our referral partner:
“Although they weren’t able to help me directly with my LTD Insurance Appeal case, Krista from the firm was able to refer me to an Appeal Consulting company that they refer clients to. That referral made all the difference for me to get the needed help and direction in order to get my Appeal ready and then approved. I’m so thankful for the referral Krista gave me.”
You can stop treading water with cases where you are likely to lose money by winning the appeal. Insurance Appeal Consultants will help these clients at the administrative appeal stage. We’ll refer back any losing appeals – only this time, you’ll be looking at a case with a strong administrative record that should have won the appeal, and is now a much better fit for your legal representation. It’s win-win-win for everyone…except the insurance company, of course.
