Should Women Pay More for Disability Insurance? Part 2

In a previous post, we discussed how a woman with the same age, job and health history as a man can end up paying an average of 25% (and in some cases, 60%) more for the same level of disability insurance protection.  We also discussed how some insurance companies raise premiums based on conditions unique to one’s sex, such as pregnancy.

When we first addressed this issue, the Massachusetts legislature was considering a bill that prohibited insurers from charging higher rates to women than to men.  At the time, Massachusetts law prohibited insurance companies from using race and religion as rating factors when determining the cost of insurance, but there was no law against using gender as a rating factor.

Recently, the Massachusetts Senate voted to approve a budget amendment adding gender to other rating factors that insurance companies are not allowed to consider when determining the cost of premiums.  The bill passed by a wide margin:  32 senators in favor of the amendment, and only 6 senators voting against the amendment.

It will be interesting to see if, in the future, other states follow suit and start to pass laws requiring insurance companies to give men and women the same premium rates for the same level of disability coverage.

References:

http://www.masslive.com/politics/index.ssf/2016/05/senate_votes_to_exclude_gender.html


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Long Term Disability by Diagnosis

In previous posts, we have been looking at the findings from the most recent study on long term disability claims conducted by the Council for Disability Awareness.  In this post we will be looking at the types of diagnoses associated with long term disability claims, and which types of claims are most common.

CDA Graph - Diagnosis

As you can see from the chart above, the most common type of both new and existing long term disability is musculoskeletal disorders—a category which includes neck and back pain caused by degenerative disc disease and similar spine and joint disorders.

This is particularly noteworthy because physicians and dentists, who often have to maintain uncomfortable static postures for several hours each day, are very susceptible to musculoskeletal disorders.  In addition, claims involving musculoskeletal disorders can be challenging, because oftentimes there is little objective evidence to verify the pain.  If you suffer from degenerative disc disease or a similar disorder, an experienced disability attorney can explain how to properly document your claim to the insurance company.

References:

http://www.disabilitycanhappen.org/research/CDA_LTD_Claims_Survey_2014.asp


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Case Study: Factual Disability v. Legal Disability – Part 3

In the last post, we discussed the facts of the court case Massachusetts Mutual Life Insurance Company v. Jefferson[1].  In that case, the court was asked to determine whether a clinical psychologist whose license had been suspended was entitled to disability benefits.  In this post, we will discuss how the court ultimately ruled, and go over some takeaways from this case.

The Court’s Ruling

As explained in the last post, the key question was whether Dr. Jefferson’s legal disability (i.e. the suspension of his license to practice psychology) happened before the onset of Dr. Jefferson’s factual disability (i.e. his depression).  In the end, the court determined that Dr. Jefferson was not entitled to disability benefits for the following reasons:

  • Dr. Jefferson’s claim form stated that he was not disabled until April 29, 1990, which was two days after the licensing board revoked his license.
  • Although Dr. Jefferson later claimed that his depression went as far back as May 1989, the court determined that such claims were inconsistent with:
    • Jefferson’s representations to the licensing board that he was a “highly qualified and competent psychologist”;
    • The fact that Dr. Jefferson had been consistently seeing patients up until the day his license was revoked; and
    • The fact that Dr. Jefferson had scheduled patients during the month following the licensing board’s hearing.

Thus, under the circumstances, the evidence showed that Dr. Jefferson’s was not entitled to benefits because his legal disability preceded his factual disability.

Takeaways

Dr. Jefferson’s case provides a good example of the challenges that can arise in a disability claim if the claimant has lost his or her license.  Here are some of the major takeaways from this case:

  1. Be Precise When Filling Out Claim Forms. The date you list as the starting date of your disability can be very significant.  Take your time when filling out claim forms, and make sure that the date you provide is accurate and consistent with the other information you are submitting with your claim forms.  It is always a good idea to double check everything on the form at least once after you have completed it, to make sure that you did not make a mistake.
  1. Recognize that Your Claim Will Not Be Evaluated in a Vacuum. Other proceedings—such as board hearings—can directly impact your claim.  You should always assume that anything you say in such a proceeding will at some point end up in front of the insurance company.  This is particularly problematic when, as in Dr. Jefferson’s case, the goals of the other proceeding are inconstant with the goals of the disability claim.  In such a situation, you may have to decide which goal is more important to you.  An experienced attorney can help you assess the strengths and weaknesses of each available option so that you can make an informed decision.
  1. Do NOT Engage in Activities that Place Your License in Jeopardy. Losing a license that you worked hard for several years to obtain is not only emotionally devastating, it can severely limit your options going forward.  Even if you have a disability policy, it is very difficult to successfully collect on a disability claim if your license has been revoked or suspended.  Once again, if you find yourself in Dr. Jefferson’s position, you should talk with an experienced attorney who can help you determine what your available options are, if any.

[1] 104 S.W.3d 13, 18 (Tenn. Ct. App. 2002).


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Case Study: Factual Disability v. Legal Disability – Part 2

In the last post, we discussed the distinction between “factual” and “legal” disability and why that distinction matters.  In this post, we will begin looking at a court case involving “factual” and “legal” disability.  Specifically, in this post we will begin looking at the facts of the case and the test that the court applied.  In Part 3, we will see how the court ultimately ruled.

The Facts

In the case of Massachusetts Mutual Life Insurance Company v. Jefferson[1], the court assessed whether Dr. Jefferson—a clinical psychologist—was entitled to disability benefits.  Here are the key facts of the case:

  • From October 1987 to February 1989, Dr. Jefferson had an affair with a former patient.
  • When Dr. Jefferson’s wife found out about the affair, she filed a complaint with Dr. Jefferson’s licensing board.
  • During the hearings in front of the licensing board, Dr. Jefferson argued that he was a competent psychologist, and that he should be permitted to continue to see patients.
  • On April 27, 1990, the licensing board permanently revoked Dr. Jefferson’s license to practice psychology, effective as of May 15, 1990. On appeal, a chancery court reduced the permanent revocation to an eight year suspension ending on May 15, 1998.
  • Up until the day his license was revoked, Dr. Jefferson continued to see patients and schedule future patients.
  • On October 1, 1900, Dr. Jefferson filed a claim under his disability policy, claiming that he was disabled due to “major depression.”
  • On his claim form, Dr. Jefferson listed the beginning date of his disability as April 29, 1990. Later on, Dr. Jefferson attempted to submit evidence that he had been depressed as early as May 1989.

The Court’s Test

As a threshold matter, the Court determined that the suspension of Dr. Jefferson’s license was a “legal disability” and assumed for the sake of argument that Dr. Jefferson’s “major depression” was a “factual disability.”  As explained in Part 1 of this post, courts generally hold that disability policies only cover factual disabilities, not legal disabilities.  However, the court’s decision becomes more difficult when a claimant like Dr. Jefferson has both a legal disability and a factual disability.

Although different courts approach this situation in different ways, here is the test that the court came up with in Dr. Jefferson’s case:

  • Step 1: Determine which disability occurred first.
  • Step 2: Apply the following rules:
    • Rule # 1: If the legal disability occurred first, the claimant is not entitled to benefits.
    • Rule # 2: If the factual disability occurred first, the claimant is entitled to benefits, if the claimant can prove the following three things:
      1. The factual disability has medical support.
      2. The onset of the factual disability occurred before the legal disability.
      3. The factual disability actually prevented or hindered the claimant from engaging in his or her profession or occupation.

In the next post, we will discuss how the court decided this case.  In the meantime, now that you have the key facts and the court’s test, see if you can guess how the court ultimately ruled.

[1] 104 S.W.3d 13, 18 (Tenn. Ct. App. 2002).


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Case Study: Factual Disability v. Legal Disability – Part 1

In the next few posts we will be looking at the distinction between “factual” and “legal” disability.  In Part 1, we will discuss the difference between a factual and a legal disability, and why that distinction matters.  In Parts 2 and 3, we will look at an actual court case involving “factual” and “legal” disability.

What is “Factual Disability”?

Factual disability refers to incapacity caused by illness or injury that prevents a person from being physically or mentally able to engage in his or her occupation.  This is the type of disability that most people think of in connection with a disability claim.

What is “Legal Disability”?

Legal disability is a broad term used to encompass all circumstances in which the law does not permit a person to engage in his or her profession, even though he or she may be physically and mentally able to do so.  Here are some examples:

  • Incarceration;
  • Revocation or suspension of a professional license;
  • Surrendering a professional license as part of a plea agreement or to avoid disciplinary action; and
  • Practice restrictions imposed by a licensing board.

Why the Distinction Matters

In sum, someone with a “factual disability” is mentally or physically unable to engage in their profession.  In contrast, someone with a “legal disability” is not allowed to engage in their profession.  Courts have repeatedly held that disability insurance policies provide coverage for factual disabilities, but not for legal disabilities.

If a claimant has both a factual and legal disability, things become more complicated.  In the next few posts, we will look at an example of how one court determined whether someone with both a factual and legal disability was entitled to benefits.


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Online Underwriting – Tips to Avoid Potential Pitfalls

Recently, several disability insurers have started to introduce new online applications in an effort to make purchasing disability insurance more convenient.  Some of them even offer automated underwriting and instant approval of your application.  In connection with the online applications, insurers are also providing more flexible options regarding benefit amounts and benefit periods.

While online applications will likely make purchasing disability insurance more convenient, here are some tips to keep in mind and some pitfalls to avoid.

  1. Don’t neglect to shop around. While it will certainly take less time to just apply to the first website you come across, you should always look at what multiple companies are offering before you apply for disability benefits.  While it may not seem like it at the time, the decision to purchase disability insurance may be one of the most important decisions in your life if you end up becoming disabled.  So make sure to take the time to research what your options are, so that you can be sure to get the best policy you are able to.
  1. Do the research. If you are merely interacting with a computer screen, you will not be able to ask questions about particular policy provisions.  Consequently, you should take the time to do outside research so that you know exactly what to look for and what to avoid in a policy.
  1. Don’t sacrifice important provisions for convenience or affordability. There are certain provisions that every doctor and dentist should have in their policy, such as an own occupation provision.  If the online policy does not offer the provisions you need, don’t settle for the sake of convenience or affordability.  Remember, if you end up becoming disabled, you will not just want any policy—you will want the best policy.
  1. Take your time when you are filling out your application. Most insurance policies contain language that allows the insurer to void the policy if you make material misstatements in your application.  Many people tend to rush through online applications, particularly if their priority is convenience.  Make sure that you double check your answers before you submit the application, to ensure that everything you are submitting is accurate.
  1. Periodically reevaluate your coverage. If your initial goal is affordability, make sure that you periodically reevaluate your coverage to ensure that it is still sufficient for your needs. Many people initially apply for low benefit policies and neglect to increase their benefits amounts later on when they can afford to pay higher premiums.  Consequently, if they become disabled, their benefit amount ends up covering only a small fraction of their prior income.

These tips are particularly important for physicians and dentists to remember when applying for disability insurance, because insurance companies are particularly aggressive towards claims by doctors and dentists.  Additionally, many doctors and dentists are accustomed to a high level of income.  Physicians and dentists who do not purchase enough coverage and later become disabled can find themselves unable to meet their obligations and care for their family, even if their disability claim is approved.  Additionally, as we have discussed in previous posts, in some cases, a single word in a policy can determine whether you receive benefits.

So remember, purchasing disability insurance is not something that should be taken lightly.  Take your time, and get the best policy you can.


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What is a Pain Journal and Why Are They Important?

In previous posts, we have discussed the importance of properly documenting your disability.  In this post we are going to discuss one way you can document your disability—pain journals.

A pain journal is exactly what is sounds like—a journal in which you document your pain levels and symptoms each day.  Creating this sort of record will not only provide you with documentation when filing your claim, but will also allow you to effectively communicate with your treatment providers regarding your symptoms, so that they can provide you with appropriate care.  Oftentimes, depending on your disability, you will go several days or weeks without speaking to your treatment providers.  A pain journal can help you easily recall and communicate to your treatment provider everything that has happened since you last met with them.

Tips for Creating a Pain Journal

When creating a pain journal, you want to be as specific as possible so that your record is complete.  You also want to make sure that you describe your plain clearly, so that you will be able to understand what you meant when you refer back to your journal.

Here are a few things you might consider documenting in your journal:

  1. The location of the pain.
  1. The level of the pain (if you use a numeric scale, be sure to also describe the scale).
  1. The duration of the pain.
  1. Any triggers to the pain.
  1. Any medications you are taking.
  1. Whether the medications you are taking are effective or have any adverse side effects.
  1. Any other symptoms in addition to the pain.

When filling out your pain journal, you may have a hard time coming up with a description that fits the type of pain you are experiencing, since all pain is not the same.  However, you should avoid the temptation to document your pain in a generic way.  The type of pain you are experiencing is just as important as your pain levels, and it is something that your insurer will likely ask you to describe.

To that end, here is a list of adjectives that are commonly used to describe pain:

Cutting; Burning; Cramps; Knots; Deep; Pulsing; Sharp; Shooting; Tender; Tight; Surface; Throbbing; Acute; Agonizing; Chronic; Dull; Gnawing; Inflamed; Raw; Severe; Stabbing; Stiff; Stinging

Sample Pain Journals:

American Pain Foundation Form:

http://static1.1.sqspcdn.com/static/f/780996/10986694/1298931690137/Partners+Againts+Pain+Daily_Pain_Diary.pdf?token=%2BxUZiQYiQI0BQuASODoUtMrCRaE%3D

American Cancer Society Form:

http://static1.1.sqspcdn.com/static/f/780996/10986775/1298931779760/pain_diary.pdf?token=4N2osqMoTgvDsWtePLtKqJGthag%3D

Peace Health Medical Group Form:

http://static1.1.sqspcdn.com/static/f/780996/10986822/1298931923430/Peace+Health+Pain+Diary.pdf?token=qqil7fKha7RaXW7%2FgJ8tCnXxihY%3D


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The Four Functions of Insurance

In this post, we are going to discuss the four functions of an insurance company.

Introduction – The Promise

Insurance is not like any other business.  Rather than selling a tangible product that you receive immediately upon paying for it, insurance companies are selling an important promise—a promise of protection, security and peace of mind if something goes wrong.

When you buy a car, you give someone money and you take a car home.  When you buy groceries, you pay money and get your groceries.  Insurance is different.  With insurance, you give them money and trust, and hope and pray that you never have to collect.

The Four Functions of Insurance

The activities of an insurance company can be divided into four major functions:

1.  Actuarial

The actuarial department is concerned with what kind of promise the company is going to sell and how much the promise should cost.  Essentially, the actuaries’ role is to analyze the financial consequences of risk and price the company’s product in a way that will allow the company to make a profit.  For example, an actuary working for a car insurance company might calculate the risk that potential customers will be in a car accident, and then adjust premium amounts to account for that risk so that the insurer can pay accident claims and still make money.

2.  Marketing

The marketing department is concerned with how to get people to buy the promise being sold.  They design ads and employ sales people.  Basically, this department’s goal is to get people interested in buying the promise.

3.  Underwriting

The underwriting department determines who the company should sell the promise to.  Underwriters review applications and assesses whether the company should allow applicants to purchase the promise.  For example, the underwriting department of a life insurance company might review health questionnaires submitted by applicants to assess whether the level of risk is low enough to provide life insurance to the applicant.

4.  Claims

The claims department’s role is to process and pay legitimate claims. While the first three departments are very much concerned about profitability, the claims department is not supposed to consider company profitability when adjusting a claim.  If the actuaries made a mistake and sold a product that is costing the company too much money, the product was not marketed correctly, or if underwriting was too lax, the company is supposed to pay legitimate claims and bear the loss.

Conclusion

As we have discussed in previous posts, an insurance company has a legal obligation to treat its customers fairly and deal with its customers in good faith.  Ideally, the disability insurance claim process should be simple.  You should inform the company that you meet the standards of the contract, provide certification from a doctor of that fact, and collect your benefits.  It is not supposed to be an adversarial process.

Unfortunately, in instances where one or all of the first three departments mess up, some insurance companies improperly shift the burden of making a profit onto the claims department.  This, in turn, transforms the claims process into an adversarial process.

If you have an experienced disability attorney involved from the outset of your disability claim, your attorney can monitor the insurance company to make sure that they are complying with their legal obligations.  If you have already filed a claim, but believe that your insurer is not properly processing your claim, an experienced attorney can review the insurer’s conduct and determine whether the insurer is acting in bad faith.


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New Methods of Surveillance: Part 2 – Drones

In Part 1 of this post, we discussed “stingrays”—a relatively new technology that is becoming more and more common. In Part 2, we will be discussing another new technology that is becoming increasingly prevalent as a surveillance tool—drones.

What is a “Drone”?

The term “drone” is a broad term that refers to aircrafts that are not manned by a human pilot.  Some drones are controlled by an operator on the ground using remote control.  Other drones are controlled by on-board computers and do not require a human operator.  Drones were initially developed primarily for military use.  Recently, drones have also been utilized for a wide range of non-military uses, such as aerial surveying, filmmaking, law enforcement, search and rescue, commercial surveillance, scientific research, surveying, disaster relief, archaeology, and hobby and recreational use.

How Does Drone Surveillance Work?

Typically, drones are connected to some type of control system using a data link and a wireless connection.  Drones can be outfitted with a wide variety of surveillance tools, including live video, infrared, and heat-sensing cameras.  Drones can also contain Wi-Fi sensors or cell tower simulators (aka “stingrays”) that can be used to track locations of cell phones.  Drones can even contain wireless devices capable of delivering spyware to a phone or computers.

Conclusion

Over the past few years, several new methods of surveillance have been developed.  These new technologies create a high risk of abuse, and as they become more and more commonplace and affordable, that risk will only increase.  Unfortunately, in the area of surveillance, the law has not always been able to keep up with the pace of technology.  In many respects, the rules regarding the use of new surveillance technologies remain unclear.  Consequently, the most effective way to guard against intrusions of privacy is to be aware of the expanding abilities of existing technology, because you never know when someone could be conducting surveillance.

References:

ACLU Website: https://theyarewatching.org/technology/drones.


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New Methods of Surveillance: Part 1 – “Stingrays”

In previous posts, we have discussed how insurance companies will hire private investigators to conduct surveillance on disability claimants.  In the next two posts, we will be discussing some modern surveillance technologies that most people are not very familiar with – “stingrays” and drones.

What is a “Stingray”?

A “stingray” is a cell site simulator that can be used to track the location of wireless phones, tablets, and computers—basically anything that uses a cell phone network.

How Does Stingray Surveillance Work?

A “stingray” imitates cell towers and picks up on unique signals sent out by individuals attempting to use the cell phone network.  The unique signal sent out is sometimes referred to as an International Mobile Subscriber Identity (IMSI) and it consists of a 12 to 15 digit number.

Once the “stingray” connects to a device’s signal, it can collect information stored on the device. Usually the information collected is locational data, which is then used to track the movement of individual carrying the device.

Additionally, some “stingray” devices can intercept and extract usage information, such as call records, text messages, and Internet search history, from devices it connects to.  Some “stingrays” are even able to intercept phone call conversations and deliver malicious software to personal devices.

Stay tuned for Part 2, where we will discuss drone surveillance.

References:

ACLU Website: https://theyarewatching.org/technology/stingray.


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