This is my chronicle of the unconscionable behavior I have witnessed by the largest LTD insurer in the United States, UNUM Corp. In sharing my story I can only hope that it is the beginning of the collapse of ERISA regulations which allow UNUM and other insurers to operate unjustly without fear of financial loss. While it is written under a pseudonym to protect my family from further harm, if anyone in the federal government sees fit to take on the current ERISA law, I am at your disposal. I can be contacted c/o The CFIDS Chronicle, PO Box 220398, Charlotte NC 28222-0398, or by sending an email to the
In October 1994, my daughter and I were diagnosed with chronic fatigue and immune dysfunction syndrome (CFIDS). Thanks to UNUM, my family did not celebrate birthdays or Christmas last year. Last November, my 19- year-old son was killed in an automobile accident and his ashes are still in a plastic bag at the funeral home because we have not had the funds to pay the funeral expense. Next month, my wife, my daughter and I will likely see our home sold on the courthouse steps. If I had received my LTD benefits, none of this would have happened. I worked too hard and too long to have this happen to my family. Yet, because I am dealing with a money-driven, arrogant, big business, my family and I lose.
My claim has been mishandled and appears to be intentionally delayed. The reason for denial of benefits has changed from "it is all depression" (revised after it was pointed out that my employer's contract did not include a mental health exclusion), to "there is no concrete evidence" of disease, and now to "while I may have CFIDS, I am not disabled." Never mind that my internist, neurologist and neuropsychologist all have submitted reports stating that I am disabled. UNUM's representatives read these reports, spoke with my doctors and issued their own version of my case, which was obviously incorrect. According to UNUM, their experts halfway across the country know best without even having talked to me.
Slipping Through the Cracks
Mine is not an isolated story. I personally know of over 125 individuals who are actively pursuing litigation against my insurer for the same reasons: delays, denials and obstructive and bad faith behavior. The pattern is quite clear. The insurer takes the full 180 days they are permitted to deny the initial claim. Then they instruct the insured that he or she can appeal the decision, but the appeal can take another 120 days. So, 10 months after applying for benefits, you may have an answer.
Don't forget the increased cost of medical insurance when you're not employed. Sure, COBRA is available, but my monthly payments went from about $135 to $555. What does this mean? Simply put, the insurer can count on emptying your bank account which means you can no longer afford medical insurance, nor can you afford an attorney to represent you. With no medical insurance you have no doctors to support your claim and, with no attorney to represent you, you simply slip silently through the cracks of society. The insurer "wins" another one for their investors and their employees. One more productive life becomes a living death. No future, no past, no hope. Worse, if you give in to the desperation and depression which this situation is bound to create, the insurer says they were right: you were only depressed.
My situation was tailor-made for the LTD insurer to delay. When I first applied in August 1995, they asked my doctor to send my former physician's records to them. The doctor never sent all of the requested records, but nearly eight weeks went by before I was informed. Once I knew, it took less than two weeks for my doctor to send them. These were promptly lost ("not received") by the insurer. So a second set was sent. It then took five weeks for the insurance company's doctor to contact my doctor.
In November I asked the insurer to expedite the decision because, in order to support my family I had to withdraw my 401k funds and hoped to replace the funds by December 9 so I could avoid paying tax on the withdrawal. I was assured that "everything is being done that can be done." I later learned that this wasn't true.
The insurer didn't request my job description from my former employer until January 16, 1996. I was also told that my case was "so difficult" that a committee would have to review my records to see if they needed to be referred to the home office, yet my records have no evidence of any committee review or recommendation. Even so, my case was transferred to the home office.
When the insurer's doctor talked with my doctors, he created a report which was to be sent to each doctor to review, approve with a signature and return. At least two of the doctors' reports in my file are not signed. Yet selected passages from these unsigned reports were taken out of context and used to deny my claim. As of nearly a year later, UNUM has not supplied copies of signed doctors' reports, even though they were requested by my attorney.
I was first denied benefits on February 12. On February 15 my attorneys mailed a certified letter stating that we would be appealing and forwarding additional information. According to the contract UNUM has with my employer, they have between 60 and 120 days to respond to my appeal. In just 45 days, UNUM sent a second denial and closed my file before we were able to send additional information, primarily because I was waiting for a neuropsychological evaluation which documented my disability. UNUM could take six months to deny but couldn't wait to close my appeal.
I have written to my State Insurance Commission. They did a cursory investigation and accepted a letter of explanation from UNUM which did not even address my concerns. I asked the Commissioner to contact others who have been denied/delayed by UNUM. Nothing was done. I have called and written both of my Senators, and neither has seen fit to do more than reply with a form letter.
My employer has chosen to ignore UNUM's obvious misstatements and fabrications. Their attitude has been "we pay UNUM to make the decision and they have done that."
The Damage Has Been Done
Nowhere in the LTD contract does it require that the insurer "approve of" my diagnosis, it only requires that I prove I am disabled. Three doctors have documented this. I have accepted my disease and want more than anything to get on with my life.
Sometimes I wish I had gotten a fatal illness, rather than a chronic one. At times it seems that my death would have made it financially so much easier for my family. They could have collected Social Security benefits. My nearly $300,000 in life insurance would have paid off all the debts and allowed my wife and daughter time to get their lives together. I have spent all my retirement income in order to live and still am no closer to a settlement with the LTD carrier. Despite this, I am committed to living and fighting their unconscionable behavior against me and others like me.
UNUM's actions will have a deleterious effect on my daughter. She is just now aware of the situation and is losing her fight with the disease. She was doing much better and had hopes of returning to school full time. The stress has negatively affected my marriage. Now the stress of the continual calls from bill collectors is even more of a stressor. My wife was diagnosed five months ago with clinical depression (I wonder why?) and my daughter is in bed at noon too ill to get up. I have no family life.
Most frustrating of all, if my attorneys are eventually successful (as I fully expect they will be), the damage will already have been done. If I had the income as I expected, I could have used the 401k funds to pay off everything except the house and my wife could have supplemented our income enough to save our home. We will never be able to qualify for a similar home unless I am awarded damages for bad faith, which is unlikely because of ERISA (see sidebar below). Rather than protect the individual, it protects the insurance industry.
So even in victory, my family will have lost it all. Bitter? Hell, yes. Depressed? Only because I have to use the legal system to fight my fight. Angry? Vindictive? You bet. Fortunately, my attorney is paid on a contingency basis and is familiar with the insurer. I can only hope to put UNUM in the same condition they have put me and so many others.
This is not the end. This is my war. UNUM and others like them are the enemy. Unfortunately the battleground is the American court system where what is "legal" is more important than what is just.
UNUM 1995 Annual Report.
Johnson H: Osler's Web. New York: Crown Publishers; 1996.
UNUM's Profits Continue to Grow
UNUM, the nation's largest private disability insurer, reported record earnings in 1995 and, just this year, announced initiatives to further increase profits. In its 1995 Annual Report,1 UNUM proposed bolstering returns to its investors through "more stringent underwriting practices," "rate increases to address unfavorable experience on selected segments of the in force business" and "reduction of benefit options for certain segments of the business." Based on the number of lawsuits from persons with CFIDS (PWCs) against UNUM, it appears that UNUM's fiscal health is coming at the direct expense of the welfare of PWCs.
According to Osler's Web,2 UNUM issued a press release in April 1994 identifying a 500% increase in CFIDS long-term disability (LTD) claims from 1989 to 1993. In 1994, UNUM failed to pay employee bonuses for the first time in seven years because of disappointing financial returns. Yet UNUM had a banner 1995, following a poor financial showing in 1994. Did UNUM find a way to profit by denying and delaying "unprofitable" claims?
Dr. Michael Kita, a UNUM medical advisor, was quoted in Osler's Web saying, "There has been a view that this is some form of mass hysteria or overdiagnosis by doctors or depression. It doesn't look that simple anymore. There does appear to be something happening." Since they can no longer deny the reality of CFIDS, UNUM has gone out of its way to deny the legitimacy of CFIDS diagnoses, and of PWCs' claims for long-term disability (LTD) benefits. -Benjamin Havens, Jr.
ERISA Protects Insurers
The Employee Retirement Income Security Act (ERISA), is one of the most comprehensive federal laws on the books. ERISA encompasses both retirement benefits and what are known as welfare benefits, which are defined as health, life and disability insurance. Two key Supreme Court decisions issued in 1987 have transformed disputes over welfare benefits into federal cases, and have also limited the remedies that are available. In Pilot Life Insurance Co. v. Dedeaux, 481 US 41 (1987), the Court ruled that any ERISA claim is subject to federal jurisdiction. Dedeaux and its companion case, Metropolitan Life Insurance Co. v. Taylor, 481 US 58 (1987), also limited a claimant's remedies solely to the benefits available under the contract of insurance, along with the possibility of an award of attorneys' fees in accordance with 29 USC §1132(g). Thus, no matter how egregious the insurer's conduct, there can be no claim for punitive or "bad faith" damages.
A recent Supreme Court ruling recognizes that organizations, such as insurers, who process insurance claims, have a duty to act "solely in the interest of the participants and beneficiaries." [Varity Corporation v. Howe, 116 S.Ct.1065, 1074 (1996).] Unfortunately, that is not always what occurs. However, there is a means of getting insurers to seriously consider the evidence of disability. The key to winning an ERISA claim is what takes place before the case gets to court. When a claim is denied, the insurer or company administering the plan is required by statute (29 USC §1133) to afford the claimant a "full and fair review." As part of that process, the claimant has the absolute right to examine the evidence in the insurer's possession and to submit additional evidence and argument. This review must be the major focus of a claimant's efforts because case law suggests that once the case gets to federal court, the record cannot be supplemented.
ERISA is a very complex area of the law that cannot possibly be explained in this brief article; however, it should be evident from this short exposition that anyone who has an ERISA claim should immediately consult with an experienced attorney to guide them through the process.
Mark DeBofsky, Atty., DeBofsky & DeBofsky, Chicago IL
The CFIDS Association of America
Advocacy, Information, Research and Encouragement for the CFIDS Community
PO Box 220398, Charlotte NC 28222-0398
800/442-3437 - fax: 704/365-9755 - Resource Line: 704/365-2343
Website: The CFIDS Association of America