Attorneys Dell & Schaefer has handled thousands of disability insurance claims and we have compiled a list of the five most common reasons that insurance companies deny claims.

GREGORY DELL: Hi. I’m Gregory Dell, and I’m joined today by attorney Rachel Alters. Hello.

RACHEL ALTERS: Hey, Greg.

GREGORY DELL: And today, we want to discuss with you the top five reasons that long-term disability insurance claims are denied. So Rachel, in preparation for this video, I know you put together a list of the five most common reasons that you see people are denied. I know you’ve handled hundreds, if not thousands, of ERISA disability appeals. Let’s start with what’s the number one reason that you see disability claims are denied.

RACHEL ALTERS: Greg, the number one reason I see disability claims denied are when the policyholder happens to be followed around by a private investigator with surveillance cameras. It happens all the time, especially when–

GREGORY DELL: You mean like personal video cameras?

RACHEL ALTERS: Video cameras, right. The insurance company will hire private investigators to follow the claimants for two days, three days, four days depending whatever they think is appropriate to see if the claimant is doing anything that they claim they couldn’t do on their application or told their doctors they couldn’t do.

GREGORY DELL: And this is without the knowledge of the claimant, correct?

RACHEL ALTERS: Oh, yeah. The claimant has no idea.

GREGORY DELL: All right. What are these disability insurance companies do with this video surveillance?

RACHEL ALTERS: With the video surveillance, what they normally do is, obviously, they review it, they get a report from the private investigator. And if they find out that the claimant is doing something that they claim they can’t do, then they’ll deny the claim.

GREGORY DELL: And do they reference that video to claimant statements, medical records? What do they apply it to the video?

RACHEL ALTERS: Well, they usually will apply the video – they’ll say, for example, that the person is using a cane in one instance and claiming that he can use a cane or has to use a cane, and then they catch him going to the mall walking around.

GREGORY DELL: Without the cane.

RACHEL ALTERS: Without the cane, and so they’ll say, OK, they were lying. They’re lying about their inabilities to work, and we believe they can go back to work.

GREGORY DELL: What’s the second most common reason that you see that claims are denied?

RACHEL ALTERS: The second most common reason is when, in the policy, usually the policy is written in a way that allows the insurance company to send the policyholder for an examination, a compulsory medical examination, which is either an IME, which is an Independent Medical Exam, or an FCE, a Functional Capacity Evaluation.

And these doctors or therapists are hired by the insurance companies, and what they do is they put him through a three-hour, four-hour examination, trying to test them to determine whether they can work. And a lot of these times, after the report’s written by these doctors – no, not every claim is denied after an IME or an FCE, but a good majority of them are because these doctors are paid by the insurance companies to write reports in their favor.

GREGORY DELL: Now you said a three or four-hour exam. That’s usually an FCE exam, which is a functional capacity exam.

RACHEL ALTERS: Sure, and an IME can be a little shorter.

GREGORY DELL: OK. Because I often get calls where they say, oh, the doctor looked at me for 15 minutes. He didn’t even touch me. He just had me come in, and he rendered his report after. Is that something also that could happen to a claimant?

RACHEL ALTERS: That does happen a lot.

GREGORY DELL: What’s the third reason that you find claims are denied?

RACHEL ALTERS: The third reason claims are denied is when there is a change in the policy definition. So, for example, most policies– not all, but most of them have a 24-month own occupation period, which means that you can’t do your own job for 24 months.

GREGORY DELL: Are you’re talk about the definition of disability, right?

RACHEL ALTERS: The definition of disability, right. Because you have to you have to fall into that definition in order to be disabled. So if you can’t do your own occupation for 24 months, there is a certain standard. And then after the 24 months expires, it becomes another standard of disability, and it’s a much more difficult definition to fit into because what you’re trying to show the insurance company is you can’t do even sedentary work, sitting at a desk all day long. That’s the standard.

GREGORY DELL: Right. And everybody’s policy has a different definition – of it could be own occ for 24 months and then the any occupation definition could have an income component, like unable to earn 60% or 80% of what you used to earn, or it could just be unable to do any gainful occupation, like a social security disability standard.

RACHEL ALTERS: Sure.

GREGORY DELL: When do you see that a disability company, when they’re going to – when a person has a change of definition, when do they start looking into whether or not the person is going to be eligible at that 24-month mark?

RACHEL ALTERS: Usually, you’d see it about six to nine months before the definition change. And at that time, they do things like they will send out the private investigator to do video surveillance and see if they’re doing anything that they shouldn’t be doing or claim that they couldn’t do. This is when they’ll send them to IMEs, for example, so they can get a report that shows that they can work. And this is what happens approximately six to nine months before the definition change, and then that’s when you’ll see a denial.

GREGORY DELL: OK. Let’s talk about the fourth reason that disability claims are commonly denied.

RACHEL ALTERS: The fourth reason I find that they’re denied is when there is improper documentation by the claimant’s physicians. A lot of times – and we know, we all go to doctors, and some of them are rushed and some of them don’t want to take the time to write notes very carefully and detailed. The problem with that is when the notes are written and they’re not written specifically to show that you’re disabled and still having many restrictions limitations, and those notes get sent to the insurance company. And when they see that, oh, look, Mr. Smith had a good day today, he was feeling good, that gives him another reason to deny you.

GREGORY DELL: Right. Because I see, unfortunately, all the time, they get one record, so-and-so had a good day today or so and so neck was fine when they have a neck problem, and three or four days later, there’s a denial letter.

RACHEL ALTERS: Absolutely. Right. Even though there’s been 30 records before and two records after that say that they’re in pain, if you have that one note that says they’re doing OK, they can deny you.

GREGORY DELL: And what can a claimant do to avoid that kind of situation?

RACHEL ALTERS: It’s communication with your physician. So if you have a good relationship with your doctor, you need to tell them, listen, this is very important that you document my restrictions and limitations very clearly because, without that, I’m going to lose my disability income, and this is something I need to live on. So if your doctor is an understanding and willing to discuss and work with you on that, it usually is very helpful.

GREGORY DELL: I mean, would you recommend that a claimant actually looks at the medical records that are transcribed?

RACHEL ALTERS: Absolutely.

GREGORY DELL: And how often should they do that?

RACHEL ALTERS: I would hope on a monthly basis, if they could.

GREGORY DELL: So basically, every visit that they go, they should get a copy of the records.

RACHEL ALTERS: And if there’s something they’re not happy with, then they need to communicate with their doctor and say, listen, can we be careful when you document because this really affects my income.

GREGORY DELL: Right. OK. Let’s talk about the fifth reason that claims are commonly denied.

RACHEL ALTERS: The fifth reason the claims are denied, Greg, is usually– and this happens all too often. I see this when I get calls from potentials, and they make mistakes on their claim forms or their applications. And the problem with that is that when you fill out a claim form and you’re not filling it out properly, this is something that stays in the record, and the insurance company will make denials on this issue often, and doctors do the same thing. Well, they’ll make a mistake when they fill out a claim form that’s sent by the insurance company.

So they’ll accidentally check that the person can work when they can’t. And sometimes that’s because maybe the office manager or one of the staff is filling it out instead of the doctor, and they’re rushed, and they don’t want to deal with the paperwork. And it gets sent to the insurance company, and then there’s a denial.

GREGORY DELL: Right. And I’ve seen things as simple as the boxes– how many hours in a day can they sit, and the doctor checks six hours or eight hours, when the person can’t even sit for two hours. So, I mean, so you’re talking about mistakes in the initial application, claimant forms that are going on a monthly basis, even someone who’s been on claim for five years. I mean, they give claimant statements every month or every six months, and then the doctors get these attending physician statements, and they can make mistakes on those as well.

RACHEL ALTERS: Absolutely.

GREGORY DELL: Again, I mean, what can a claimant do to try to avoid those kinds of mistakes?

RACHEL ALTERS: Well, a claimant could hire somebody to be their advocate so the mistakes don’t get made. So the claim forms come through, for example, if we were representing them, they come through come to our desk first, we review them, make sure there’s no mistake before they get sent to the insurance company. And the same thing when the doctor fills them out, they can get sent to an attorney first to make sure that everything was filled out properly, and if it wasn’t, we can send it back and get it done right. Because once it’s in that claim file, it’s there, and it’s very hard to reverse a decision once they make up their mind to deny, then they’re in the process of having to appeal the case.

GREGORY DELL: Right. And that’s part of that monthly claim handling service that we offer, where we always review all the medical records, review the claimant statements, review the attending physician statements, review all the communications that come back and forth from the disability carrier, because look, person gets on claim, they’re sick. They don’t have experience with handling a disability insurance policy and knowing every single thing they have to do in order to keep getting paid, but you know, if there is one opportunity to deny a claim, the disability insurance company is going to jump through that door and deny it.

RACHEL ALTERS: Absolutely. And a lot of times, the claimants are depressed, and they don’t have the energy to deal with it either. And so it’s something that they don’t have the capability of handling.

GREGORY DELL: Right. Well, Rachel, I want to thank you for putting together that list of the five most common reasons that people are denied long-term disability benefits. I want to tell our viewers that if there’s any type of claim that you have, whether it’s an application, a monthly claim handling issue, or if you’ve been denied, feel free to call us at anytime for a free consultation. We’ll be happy to review your policy, discuss your claim with you, and if we’re able to help you, we’ll let you know.