Occasionally courts will remand a disability claim back to the plan’s claim administrator (often an insurance company) for further consideration if it finds that the claimant has been denied a full and fair review of his or her claim. The Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001, et seq. (“ERISA”) and its claims regulations are silent as to how long the claim fiduciary has to consider the remanded claim before making another claim determination. A recent decision from the United States District Court for the District of Oregon held that the remanded claim should be treated like any other administrative appeal of a disability claim determination and ruled upon within 45 to 90 days, depending on the circumstances.
In Robertson v. Standard Ins. Co., Case No. 3:14-cv-01572-HZ, 2016 U.S. Dist. LEXIS 166079 (D. Or. November 4, 2016), the plaintiff sought to reopen her case against Standard Insurance Company in her quest to recover long term disability (“LTD”) benefits. In 2015, the Court: granted her motion for summary judgment; found that Standard had abused its discretion in denying her claim for LTD benefits; and remanded her claim to Standard for further consideration, including conducting a so-called independent medical examination (“IME”) and review of an award of Social Security Disability benefits to the Plaintiff. Standard did not decide the remanded claim in the months that followed.
The Plaintiff filed a motion to reopen the case and the insurer requested that the reopened case be stayed while it completed its review on remand. The Court agreed to reopen the case and denied the motion to stay the action. Instead, the Court held that the remanded claim should be deemed denied on remand and the Plaintiff’s claim should proceed in court. In reaching its decision, the Court held that ERISA’s claims review regulations at 29 C.F.R. § 2560.503-1 set the applicable time limits for the claim fiduciary to decide the claim on remand. Under those the regulations, a disability plan administrator has 45 days in which to consider an administrative appeal of a denial of disability benefits. In certain circumstances, the administrator may receive an additional 45 days to consider the claim. The administrator is not permitted to take longer than 90 days to consider a disability claim appeal. If the administrator takes longer than 90 days to consider the appeal, the claimant and court may consider the appeal to be deemed denied on appeal.
The Robertson court recognized that there are some courts that have held that the claims regulations do not apply to claims on remand. It noted, however, that there was no binding authority in the Ninth Circuit to that effect. Moreover, the United States Department of Labor (“DOL”) has submitted an amicus brief in a pending case before the United States Court of Appeals for the Second Circuit in which it interprets its claim review regulation as applying to disability benefit claims that have been remanded to the administrator. Given the conflicting authority, as well as the DOL’s stated position on the issue, the Court deferred to the DOL’s position and held that the remanded claim was deemed denied by the insurer and was properly before the court once again.