Your Money Lost; MetLife’s Long-Term Disability Scam in MetLife v Glenn

We write a lot here about group long term disability policies and what bogus products they are. So much so, it is financially unsound to trust these policies to take care of you should you become injured, sick or disabled.

A particularly egregious example of just how worthless group policies are is seen in a case that made it to the Supreme Court (please note how the dissents fall in strict Citizen’s United lines) in Metropolitan Life Insurance Company v Glenn where MetLife was both the insurer and administrator of the group plan that insured Ms. Glenn–a huge conflict of interest. It’s like having the fox watch the hen house.

The plan grants MetLife (as administrator) discretionary authority to determine whether an employee’s claim for benefits is valid; it simultaneously provides that MetLife (as insurer) will itself pay valid benefit claims. App. 181a–182a.

MetLife sought Supreme Court review because of an earlier decision that forced MetLife to pay Ms. Glenn her benefits. MetLife spent a lot of money on this because of the precedent it set: An insurance company had to make good on a long-term disability claim and pay benefits to a person who became too disabled to work full time.

Ms. Glenn was a Sears employee who was diagnosed with severe dilated cardiomyopathy. She had dutifully paid her premiums and now she needed to use her benefits since she was too sick to work due to heart failure.

Respondent Wanda Glenn, a Sears employee, was diagnosed with severe dilated cardiomyopathy, a heart condition whose symptoms include fatigue and shortness of breath. She applied for plan disability benefits in June 2000, and MetLife concluded that she met the plan’s standard for an initial 24 months of benefits, namely, that she could not “perform the material duties of [her] own job.” Id., at 159a–160a. MetLife also directed Glenn to a law firm that would assist her in applying for federal Social Security disability benefits (some of which MetLife itself would be entitled to receive as an offset to the more generous plan benefits).

MetLife directed Ms. Glenn to a law firm to make sure she got Social Security so they could off-set her benefits. CIGNA and all the other insurers do the same. See my earlier blog postings at Illness and Insurance Hell. Just follow the money.

MetLife received the bulk of those retroactive benefits due to offsets written into the language of the policies themselves. These group disability policies are, in essence, bogus products; don’t waste your money.

The Social Security Administration consequently granted Glenn permanent disability payments retroactive to April 2000. Glenn herself kept none of the backdated benefits: three-quarters went to MetLife, and the rest (plus some additional money) went to the lawyers.

After the first two years of Ms. Glenn’s policy, MetLife decided to reverse themselves:

To continue receiving Sears plan disability benefits after 24 months, Glenn had to meet a stricter, Social-Security-type standard, namely, that her medical condition rendered her incapable of performing not only her own job but of performing “the material duties of any gainful occupation for which” she was “reasonably qualified.” App. 160a. MetLife denied Glenn this extended benefit because it found that she was “capable of performing full time sedentary work.” Id., at 31a.

On one hand, MetLife forced Ms. Glenn to apply for Social Security benefits, sent her to a law firm to help receive them and took taxpayer dollars to offset the plan she paid premiums for BUT when it came time to continue paying those benefits after the first two years, MetLife “itself had to determine whether she could work, in order to establish eligibility for extended plan benefits, it found her capable of doing sedentary work and denied her the benefits.”

This was what the Social Security agency said as well, but with help from the law firm they sent Ms. Glenn to, MetLife pushed, and received, tax payer dollars in the form of Social Security dollars. They burden the Social Security system.

The Supreme Court found this questionable as well and said so:

In particular, the court found questionable the fact that MetLife had encouraged Glenn to argue to the Social Security Administration that she could do no work, received the bulk of the benefits of her success in doing so (the remainder going to the lawyers it recommended), and then ignored the agency’s finding in concluding that Glenn could in fact do sedentary work. See id., at 666–669. This course of events was not only an important factor in its own right (because it suggested procedural unreasonableness), but also would have justified the court in giving more weight to the conflict (because MetLife’s seemingly inconsistent positions were both financially advantageous). And the court furthermore observed that MetLife had emphasized a certain medical report that favored a denial of benefits, had deemphasized certain other reports that suggested a contrary conclusion, and had failed to provide its independent vocational and medical experts with all of the relevant evidence. See id., at 669–674. All these serious concerns, taken together with some degree of conflicting interests on MetLife’s part, led the court to set aside MetLife’s discretionary decision.

MetLife also did the same thing CIGNA did to us, namely pick out information that bolstered their point of view of the reality of my husband’s disease, Multiple Sclerosis:

The Court of Appeals ultimately set aside MetLife’s denial of benefits in light of a combination of several circumstances…(3) MetLife’s focus upon one treating physician report suggesting that Glenn could work in other jobs at the expense of other, more detailed treating physician reports indicating that she could not; (4) MetLife’s failure to provide all of the treating physician reports to its own hired experts; and (5) MetLife’s failure to take account of evidence indicating that stress aggravated Glenn’s condition. See id., at 674.

If you are wondering why this happens, it’s simply due to corporate greed and money–lots of money. These group policies are huge money makers for the large health insurance companies and they rake in billions in profits each year from them. Paying out claims to people with Multiple Sclerosis is not what they want to do–their interests lie in fattening the bottom line.

As financial tools, they are worthless and a waste of your hard-earned dollars. You have alternatives such as private policies. Save your money and look elsewhere. And if you think these policies need to be better regulated or ERISA should be removed or rewritten as law, write your members of Congress. That’s what we pay them for.

Your health and well-being do not matter to large corporate entities no matter how much they try to spin it otherwise. See AHIP.

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Your Money Lost: Group Long Term Disability Insurance Policies

Did you know your tax dollars are used to subsidize private health insurance companies?

If you are unfamiliar with Social Security Disability Insurance, here is an excellent primer put out by AARP. SSDI provides protection specifically to qualified U.S. citizens who become disabled and lose their ability to earn an income. We all pay for this through our Social Security taxes. It’s one of the many benefits of being a United States citizen.

When my husband was employed at Fidelity Investments he had a group disability insurance policy with CIGNA. He even purchased extra coverage–to protect our family with 80% of Paul’s income just in case something happened.

But that money was ill-spent as CIGNA did everything in their power to deny coverage to a man with Progressive-Relapsing Multiple Sclerosis. This is not unusual behavior for any private insurance company. In fact, it’s exactly what they do.

But first, you must apply for Social Security Disability Insurance.

When Paul was mid-way through with short term disability and it appeared he was getting progressively worse and not better, CIGNA telephoned us to inform us that they were getting his file ready for long term disability. Great, we thought, they are helping us! Isn’t that what they collect a premium each month for? The answer to that is, no. They collect a premium each month to make money. Keeping that money and not paying it out in claims helps their bottom line.

From the Group Life Market Survey 2009 outlining the sales in disability insurance, you can see group sales disability totaled $1.3 billion at mid-year, with 27 private insurance companies covering 95% of the total market.

After CIGNA denied Paul’s benefits, they telephoned us again. “You must apply for Social Security benefits and send us proof of your application or your long term application with us will be invalid.”

Why does a private insurance corporation demand that you apply for government benefits?

Money, that’s why. If you qualify and receive Social Security Disability Insurance then your insurance company will off-set the amount of money they contractually owe you by the amount of money you will receive from the government. For example, if Paul’s CIGNA policy was to have paid him $5,000 a month and SSDI would give him $2,000 a month, then CIGNA would subtract that amount and only give Paul $3,000 a month. Your tax dollars are used to subsidize private corporations.

Your money is used to fatten the bottom lines of Aetna, AIG Benefit Solutions (that’s how much now in government money for AIG?) CIGNA, Guardian Life, Hartford Life, Mutual of Omaha, Northwest Mutual, Prudential, Sun Life, UnitedHealthcare, Unum and Wellpoint, to name but a few.

Why pay a premium at all?

An entire industry has been set-up surrounding group disability plans to help private insurers NOT pay the claim.

For example, every year the American Conference Institute (one among many) has a yearly event titled, “Litigating Disability Insurance Claims.” Please click the link and read the brochure–it is so very eye-opening. From the brochure, here is what the insurance companies, their general counsels, federal judges (they are the very same federal judges who will decide your disability case!) and doctors will discuss at the above-mentioned conference, emphasis in blue is mine:

• Whether the medical record is reliable: Whether the treating physician is biased and favors the patient
• Providing the credentials of the IME’s (Independent Medical Examiner–hired by insurance company): Identifying what is relevant; Highlighting the appropriate credentials; Ways to appropriately critique the credentials of the IME: what to look for and ways to address the inadequacies; Whether specialized medical knowledge is a necessary component of the IME’s credentials (in the case of Multiple Sclerosis, patients are seen and treated by neurologists, the IME who looked at Paul’s written medical records was not a neurologist and first letter of denial was written by an RN and not a doctor)
• Rotating vendors to avoid the appearance of bias and to ensure an independent review of the claim
• The denial factor: How many claims were reviewed and denied?; Whether repetitive denial leads to an appearance of bias; Ways to utilize claim denial information
• Whether the claimant is constrained by financial pressures and returns to work disabled

The last one is of particular interest to me because that is exactly what happened to this family. This family, faced with zero income as Paul had been the sole bread winner for most of our married lives, had to return to work at Fidelity Investments, disabled. This is something the insurance company counts on to help bolster their claim that you are not disabled.

Medical evidence that you are disabled will not prevail.

This conference, and others like it, focus on how to prevent paying a claim, and it does not matter if the claim is legitimate, what matters is the corporate bottom line. The American Conference Institute also has another conference dedicated to defending ERISA claims attended by more federal judges–the very same ones who will hear your ERISA disability case.

Your premium dollars, the ones you work so very hard to pay each month to your private insurance carrier, are not spent on paying a claim should you wake up one day with cancer, MS or become injured in an accident. No. Those hard earned dollars are spent on figuring out how not to pay you. And then, they use your tax dollars to reduce the amount they owe you.

United States taxpayers, it’s time to say enough. Group long-term disability policies are bogus products. They should either be highly regulated or not allowed to be sold at all, as the poorly written policies and the attendant machines put in place by the insurance companies to deny all claims, make the products fraudulent and worthless.

Links:

CIGNA written brochure for brokers about their long term disability product.

Dell and Schaefer, a law firm, discussing CIGNA including the LINA settlement in California.

Awareness and understanding of Multiple Sclerosis.

It finally happened to us. I always knew in the back of my mind it would, but I thought: The lot at Costco, that will be the place. That’s because there are a thousand handicap spots that always seem to be full, with thousands more people waiting off to the side with their blinkers on, ready to hit the gas to make sure they get into that blue-lined spot. It gets pretty contentious in the Costco lot.

And considering the current social climate we are living in, with many people taking their cue from the likes of radio personalities that spew hate, fear and blithe ignorance, I am surprised it took this long. Everyone, it seems, is angry.

It was Christmas eve and we finally got a break from the rain. Paul and I decided to drive over to the beach and take the dogs out for a walk. As you may know, Paul is logging his miles for his Walk While I Still Can campaign, and the beach is good for Paul. It doesn’t hurt as much as the sidewalk.

We pull into the handicap spot and start to unload the dogs. An elderly woman, despite her full head of silvery-white hair and aged face, was moving along at a brisk pace as she made a beeline for us. She was quite erect and in good shape for her age. Very good shape.

“Excuse me,” she said with a large, kind of Grinchy smile, “You can walk, so why are you parked in a handicapped spot?”

There was a certain passive-aggressive thing going on with her approach and tone.

Paul looked up at her, “I can walk, for now, but I have Multiple Sclerosis. I’m in a whole lot of pain when I walk and sometimes I don’t walk so well.”

I chimed in after the fact, “He has Multiple Sclerosis.” Very effective there, Margaret.

“Oh,” she said. “I was just wondering why since you looked fine to me. I’m sorry, just wondering, okay, Merry Christmas.”

She stood there for a few seconds, waiting to see if we had anything else to say. We didn’t, so off she went.

Now, a couple of things here. First, when you look at Paul walking for any amount of time, you know something’s wrong. But she didn’t have that time to observe him before she approached two complete strangers.

Paul walks funny. He’s got a limp for one thing and his legs don’t quite move themselves the way yours and mine do as he moves along. That’s because he can’t feel his legs. What he does feel is a combination of numbness, tingling, hot burning pain or a complete dead sensation, as he puts it. And he never knows, from one day to the next, what he is going to be capable of doing. Some days are good, some not so much.

Second, I missed my opportunity to educate this woman; to make her aware of this disease and what it does to those who have the misfortune of waking up one day and being diagnosed with MS. I was too angry to speak.

Why was I so angry? Probably because I operate on the notion of I wouldn’t do that to you, so why would you do that to me? I thought it was pretty nervy and quite rude of her to ask such a question without first knowing the facts. Trying to understand what someone else may be going through is key to many issues we face. Making blind assumptions usually gets us all in trouble.

Was she hoping to catch someone using a handicap sticker on their car illegally? Maybe. But what she did do is approach two strangers without the slightest notion that something could be wrong.

What I would have told her is this: My husband woke up one day, five years ago, and couldn’t feel his left leg. At his age, at any age really, that’s scary. He was told 10 days later he has Multiple Sclerosis.

If you don’t know what it does it’s a chronic, debilitating disease. There is no cure. It affects the central nervous system and leaves its victims helpless as to what their bodies can and can’t do. One person with MS may be in a wheelchair, while another may still be walking along. People with MS can’t always control their bodies.

My husband was on chemotherapy for his disease. People with MS have many battles that have nothing to do with their bodies. Usually, the battles are with their insurance carriers who don’t like to pay. Other battles are with the pharmaceuticals who see MS patients as a gold mine and don’t really want to cure the disease but make drugs that are expensive and keep them going–barely. So, let me make you aware. My husband can walk. But just barely, and for us, his family, that’s frightening because there are so many other things going on with his disease and his body. That’s why we are parked here. And you can help make others aware too now. Merry Christmas.

A guide on awareness I wrote in 2009 and posted again earlier this year, can be found here.