ERISA Regulations

The Employee Retirement Income Security Act (ERISA) is governed by federal statutes.

The claims procedures originate from 29 U.S.C., Section 1133 and 1135.  Section 1133(1) requires that a carrier or claims administrator provide adequate notice of the reasons for denial that can be readily understood by the claimant.  Section  1133(2) requires ERISA plans to afford claimants a full and fair review, usually called an appeal, of a denied claim by a claim fiduciary.  The full and fair review is usually conducted by the same entity that issued the denial, typically an insurance carrier or third-party administrator, but must be conducted by someone other than the adjuster who denied the claim.

Section 1135 grants the power to the Secretary of the U.S. Department of Labor (DOL) to establish claims regulations that comply with ERISA.

The ERISA claim regulations established by the Secretary of Labor are with 29 CFR 2560.503-1.  An adequate notice of denial must contain the following information:

1. The specific reason or reasons for the adverse benefit determination;
2. Reference to the specific plan provisions on which the determination is based;
3. A description of any additional material or information necessary for the claimant to perfect the claim and any explanation of why such material or information is important; and
4. a description of the plan’s review procedures and the time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under Section 502(a) (1132) of ERISA following an adverse benefit determination on review.

For group life claims, the claims administrator is required to decide the initial claim within 90 days of receipt of the claim, which can be extended for another 90 days by written notice prior to the expiration of the initial 90 day period.  Disability claims must be decided within 45 days or receipt of the claim, with two potential 30 day extensions if, due to matters beyond the claims administrator’s control, the extensions are necessary.  For the extensions to be valid, the claims administrator is required to notify the claimant in writing during the initial period that the extension will be taken and explain the reason or reasons for the need of extra time.

A claimant’s request for review must be in writing with strict time lines for when the review must be sought.

The claimant filing an appeal has a right to:

1.  the claim file for and may provide additional support for the claim;
2.  have a different person review the appeal;
3. if the appeal is related to a medical determination, the adjuster must hire a different medical expert to review the claim;
4. the medical and vocational experts whose opinions were obtained in the initial review must be identified.

If the claim review results in a continued denial, the denial must contain the following information:

1.  the specific reasons for the denial after review;
2. reference to the specific plan provisions upon which the denial is based;
3. a continued right to obtain the claim file; and
4. any additional voluntary appeal and the claimant’s right to bring a lawsuit under 502(a) of ERISA.