An issue that comes up often during litigation of a claim for disability benefits is: After exhausting all of your administrative remedies for a clam for STD benefits, may a lawsuit be brought for LTD benefits as well? Insurance companies frequently move to dismiss claims for LTD benefits, claiming that the Plaintiff failed to successfully appeal the denial of the STD claim, therefore the LTD claim was never at issue.
However, in a recent case out of Kentucky, Basham v. Prudential (W.D. KY, Feb 21, 2014), the Court disagreed with Prudential’s argument to dismiss Plaintiff’s claim for LTD benefits arguing that the Plaintiff only filed a claim for STD benefits and never properly filed an LTD claim. In her summary judgment motion, Basham directed the Courts attention to a document found on Prudential’s website (www.prudential.com/mybenefits) entitled “Disability Claim Instructions” which sets out the requirements for the filing of an LTD claim. Prudential argued that this document should not be considered in this case as it was not part of the administrative record. The Court disagreed, stating although not contained in the administrative record, the document is properly considerable in determining whether Basham properly filed her LTD claim. Specifically, the document states in pertinent part:
…If you have both STD and LTD coverage with Prudential, and you have filed a claim for STD, there is no need to resubmit the statements noted above (Employee’s Statement, Attending Physician’s Statement and Employer’s Statement) for the LTD portion of your claim. Your claim for LTD benefits, in this case, will be considered filed, when you meet both of these two criteria: 1) We receive the Employee’s Statement, the Employer’s Statement, and the Attending Physician’s Statement; 2) The date is 45 days before the end of your LTD elimination period.
Prudential violated ERISA regulations by failing to render a decision on her LTD claim.
After finding that the Plaintiff had properly filed a claim for LTD benefits, the Court determined that Prudential’s failure to consider her LTD claim was in violation of ERISA. Since Prudential only addressed her STD claim and the Plaintiff never received notice of Prudential’s adverse determination of her LTD claim, the reasons therefore, or a request for additional material information necessary to perfect her claim, the Court found that Prudential violated ERISA and remanded the claim back to Prudential to conduct a full and fair review.
This is an important decision for claimants who have Prudential STD and LTD plans governed by ERISA. According to the Court in this case, it is possible that once a claimant files an STD claim for benefits with Prudential and they meet the two criteria set forth above, their LTD claim is also deemed filed. However, be aware that this may not be the case for plans with other insurance carriers. It is important obtain the procedures from your individual carrier to determine how to properly file a claim for STD and LTD benefits.