Shawn E. McDermott - Blog

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As mentioned elsewhere on this website and in our various blogs, Unum Life Insurance Company assumed the role as the Disability Program Administrator for the Colorado Public Employees Retirement Association’s (PERA) Disability Program. Unum became the administrator on January 1, 2011. If a PERA Member submitted a claim for disability prior to the end of 2010, but the claim decision was not rendered until 2011, then Standard Insurance Company decided the short term disability (STD) claim while Unum was charged with the responsibility of determining potential entitlement to “disability retirement.” Our office has assisted many PERA Members through this claim process. We were recently informed by the Unum claims representative (more…)

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As a reader of this blog site, you are likely aware of the class action lawsuit filed by the Law Office of Shawn E. McDermott against Standard Insurance Company and the Colorado Public Employee Retirement Association (PERA). This case is pending in Denver District Court. The basis of the lawsuit is our firm conviction that the PERA Rule 7.45(E) and the PERA short term disability policy issued by Standard Insurance for the benefit of all PERA members does not comply with the law. See my previous blog posts for a more detailed description of this lawsuit by clicking here.

As counsel for Plaintiff in the class action lawsuit filed by our client, Tracey Lawless, we have filed a motion to certify the case as a class action under Rule 23. The issue is now fully briefed and awaiting the court’s decision. Perhaps more importantly, we have also filed our dispositive motion and extensive legal brief asking Judge Hood to agree with our position that the “second prong” of the short term disability (STD) definition found in the policy must beremoved as it is not supported by and is entirely inconsistent with the PERA statute defining when a PERA member is entitled to STD payments. As of earlier this week, the dispositive motions filed by all parties are also now fully briefed. We simply await the Judge’s determination.

As a reminder to all who may be affected, if you believe your case fits within this proposed class or if you have any other questions regarding your Colorado PERA disability retirement claim or denial, you can always contact the disability insurance lawyers at our office for an initial, free consultation.

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The news over the past couple of weeks has reminded the taxpayers and voters in this country that the Social Security Administration funding for disability payments is projected to run out of money in 2017. While the estimates for going broke on the retirement side of Social Security projects the problem will not to hit us for a couple of decades, Congress will have to act in the very near future to ensure proper funding of SSD (disability) payments. It is easy to predict that the political answer to this crisis will not come until the last minute and perhaps two primary elections from now.

What is perhaps more baffling is that Congress has turned a blind eye to one way to fix the problem, which is something ERISA disability attorneys deal with every day on behalf of our clients. Every group disability policy this office has reviewed for years provides that the disability benefit payable by the insurance company is reduced by any amounts the insured/claimant receives from Social Security Disability. Why is this the case? Why isn’t it the other way around; that is, the SSD payment reduced by the amount paid under a disability policy? (more…)

Shawn McDermott has been recognized as a Colorado “Super Lawyer” for 2010. Mr. McDermott’s recognition falls in the area of Employee Benefits/ERISA Insurance Coverage and Personal Injury. The Super Lawyer’s recommendation is made by FindLaw.com, a Thomas Reuters business, an independent lawyer rating service. The selection process is based upon a “comprehensive, good faith and detailed attempt to produce a list of lawyers that have attained high recognition, meet ethical standards, and have demonstrated some degree of achievement in their field.” According to the Super Lawyer’s website, each candidate is evaluated on 12 indicators of peer recognition and professional achievement. Selections are made on an annual state-by-state basis. Only 5% of lawyers in the state of Colorado are given the designation of Super Lawyers. The Super Lawyers website can be found here.

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Nicole entered the Macy’s department store at the Town Center of Aurora in January 2007. She was nearly 100 feet inside the store when she slipped and fell. Snow, ice and water had been tracked in from the snowy conditions outside. According to our client, the floors were an absolute mess. We were able to learn through discovery in litigation that, according to the cleaning company’s supervisor, they were experiencing an impossible time of keeping the floors clean during the 2006-2007 winter months. The location where Nicole fell was a “known problem area.” Nicole suffered a broken hand and serious injuries to her skull. She had an immediate headache due to her closed head injury. Unfortunately, the head injury was actually more serious than originally believed. An underlying chiari malformation at the back of her skull, which had been asymptomatic her entire life was now a major problem. She eventually required fossa decompression surgery and significant follow up care. She has not been able to return to work fully since 2007. (more…)

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We recently learned that Standard Insurance Company has agreed with the position we took on behalf of a client whose claim for long term disability benefits had been denied. Our client’s claim was somewhat unique in that she had been receiving long term disability benefits for several years due to her chronic cardiac condition and related medical issues including a diagnosis of bi-polar disorder. Hoping that she had regained some stamina and because she was frustrated with living too simplified of a life, basically staying at home, our client wanted to attempt a return to employment. Wisely, before doing so, she spoke with the claims representative at Standard Insurance who ensured her that she had a 180-day window within which to attempt to return to work and that if she was unable to do so, her disability benefits would recommence, a.k.a a recurrent disability claim. Relying on this representation our client returned to work for a couple of months and quickly realized her medical condition did not allow her to do so. In contacting her claims representative after the return-to-work failed, she was shocked to learn that the reinstatement of disability benefits would not occur, because she had not returned to her former employer for the trial return to work period. (more…)

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The Supreme Court of our land issued a new ERISA decision on May 16, 2011 titled Amara v CIGNA, Case No. 09-804, which restores equity to the law of employee benefits.

Here, the plaintiffs were understandably perturbed when CIGNA converted their defined benefit plan to a cash balance plan. The summary plan description of the changes provided by CIGNA to its employees was misleading in that it characterized the new plan as being more generous than it actually was. At the district court level, the judge found that CIGNA had withheld accurate information from the employees. CIGNA appealed. The Second Circuit agreed with the district court, and the case ultimately ended up at the Supreme Court. Although CIGNA technically won the battle with Amara (who was the representative plaintiff in the class action), the ultimate impact of the decision should well benefit plan participants. The Supreme Court agreed with CIGNA that the lower courts had incorrectly used an ERISA enforcement provision found at 29 USC Section 1132 (a)(1)(B) to reform CIGNA’s pension plan. Generally speaking, an ERISA claim against a plan or plan insurer under section 1132 (a)(1)(b) allows courts to award claimants the benefits due under the plan.

However, importantly, the Court went on to hold the plan could be reformed under a different subsection of the same statute, subsection (a)(3), which provides ERISA participants with “appropriate equitable relief” to redress violations of an ERISA plan or to enforce the terms of a plan. The Supreme Court ruled that pension plan fiduciaries could in fact be held liable for “make-whole” relief for the harm they cause employees (participants in the plan) in failing to comply with their duties in administering the pension plan. In the end, the Court really seems to have opened the door for the employees to recover what an employer promises would be received in exchange for their employment efforts. Yes, I know this sounds obvious to the casual reader, but the past 20 years of ERISA decisions by our courts had so twisted this arena that many wrongs committed by plan fiduciaries did not result in an actual, fair remedy to the aggrieved employee. Hopefully the tide is turning.

Insurers and their ilk are already attempting to spin this decision in their favor, as CIGNA was in fact successful in having the lower court decision overturned. But the only thing that really happened was that the Supreme Court clarified which section of the ERISA enforcement statute provides the relief sought by the class plaintiff, and clarity was provided as to the scope and substance of remedies available under subsection (a)(3) which could include money damages.

Click here for further information on ERISA welfare benefit claims.

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Studies suggest that 60% of individuals over age 65 will require some type of long-term care services during their lifetime. Long-term care insurance was developed to specifically cover the costs associated with long term care services. Most policies being sold to the public today are comprehensive policies covering care and services in many different settings including the home, adult day healthcare centers, respite care, hospice care, assisted living facilities, nursing homes and Alzheimer’s special care facilities. These services typically include home assistance with activities of daily living or nursing home care. The services provided by such coverage are typically not covered by traditional health insurance, disability insurance, or federal assistance programs such as Medicare or Medicaid.

Long-term care claims are denied at an alarmingly high rate. The insurance companies which offer long-term care coverage hope that such claims are never filed in the first place (because the elderly insured under such policies may have forgotten they have such coverage) that individuals will chose not to fight for the benefits to which they are entitled, or because denied individuals believe they cannot afford an attorney. Some of the most popular companies offering long-term care insurance are Genworth Financial, Conseco, Banker’s Life, Penntreaty, John Hancock, MetLife, Mutual of Omaha and Prudential Financial.

If your Colorado long-term care claim has been denied, you should not hesitate in seeking assistance from an attorney who understands these claims. At the Law Office of Shawn E. McDermott, LLC, in Denver, Colorado, we have been in the business for years of helping individuals obtain the insurance benefits to which they are entitled. If you or your elderly loved one requires assistance in pursuing a denied claim, you are likely preoccupied with other matters. We are here to assist you through this process and may be willing to take your case on a contingency fee basis if you are unable to incur attorney’s fees out of your own pocket. You may contact a Colorado long-term care attorney by completing our contact form or contacting our office at (303) 964-1800. Our attorneys can help answer your long-term care benefit questions.

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One by one, additional states are knocking down discretionary clauses in long term disability insurance policies. In Maryland this past week, its bill to outlaw discretionary clauses in their disability policies has passed both houses of their legislative branch. The bill will now move on to a full vote and eventually (presumably)signature by their governor. When that occurs, Maryland will join the list of an ever growing number of states who have passed laws in one form or another banning an insurance company’s use of a discretionary clause. Colorado is one such state. As reported in prior blogs and throughout our website, a discretionary clause can be the biggest hurdle to a successful recovery of a claimant’s denied long term disability benefits, if the claim is governed by the Employee Retirement Income Security Act (“ERISA”). For more on discretionary review, please click here. If you believe your long term disability insurance or life insurance claim has been wrongfully denied, feel free to contact our office at any time to learn more about your rights, the law that applies to your claim and your legal options and remedies. Our initial consultations are typically performed without charge.

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I have previously blogged about life insurance and accidental death and dismemberment coverage. For those employers who offer a benefit package to their employees, in addition to health insurance and long term disability insurance, the employee may also have this additional coverage. Often times, the life insurance protection contains a “Basic Life” feature as well as a “Supplemental Life” option. The life insurance benefit amount for an employee is often one or two times their salary. Supplemental life insurance, if selected, allows the employee the option of increasing their life insurance benefit significantly. (more…)