An Appeal of a Benefit Denial with the Insurer Is Not Really an Appeal

Courts, regulations, and practitioners commonly refer to the process of having the insurer review an ERISA benefit denial as an “appeal.”  This label can be a trap when appealing an ERISA benefit claim.  Lawyers think of an appeal as a review of a decision based on the existing information in the record.  When we appeal a trial court decision, we can’t present new evidence, and we can’t even make an argument on appeal that we didn’t make in the trial court.  We generally, therefore, have to be reactive to the decision below, attacking it on the basis of misapplication of the laws or facts.

So, many lawyers and ERISA benefit claimants do a reactive appeal with a benefit denial as well, spending most of the appeal discussing how the insurer’s decision was not rational, that it ignored evidence, that it disregarded the language of the plan, etc.  There are two big problems with this:

• First, in my experience as a Connecticut benefit appeal lawyer, insurers will rarely overturn a denial based just on criticism of how the insurance company reached its decision to deny benefits, no matter how bad the decision was.
• Second, following the reactive “appeal” model may result in you not making a totally new argument on appeal that may be a better basis for an award of benefits than you made in your initial application, or in the first appeal.  You have the opportunity to make a whole new case: you didn’t argue when you submitted your LTD claim that a psychological condition contributed to your disability from a physical condition?  No problem.  On appeal, you can get statements from your treating physicians discussing the issue.  

The deficiencies in the insurer’s decision must be addressed, of course.  But first, make your positive argument, why you are entitled to benefits, including bases for benefits that you have not made before, and you will be more likely to prevail on an appeal of an ERISA benefit denial of long-term disability benefits or a group health insurance claim.  You will also have a much stronger case if it goes to court.