DOL Disability Claims Regulations: Effects on Employee Benefits Plans

The Department of Labor (DOL) requires plans to comply with the final rule under Section 503 of ERISA aimed at providing employees new procedural protections when dealing with plan fiduciaries and insurance providers who deny their claims for disability benefits.

The final rule added disability benefit claims regulations to include most of the procedural protections afforded to group health plan claims under the Affordable Care Act. The rule applies to pension or 401(k) plans if a plan fiduciary has discretionary authority to determine whether a participant is disabled under the plan terms. Plans must offer effective disability claims procedures, provide more information in denial letters, adhere to disclosure requirements, ensure an impartial process, and more.

Nonqualified plans are still subject to the ERISA enforcement provisions and must contain claims procedures that comply with the regulations if the claim requires a determination of whether the participant has a disability. Counsel and benefits advisers must understand the implications of the new disability claims regulations and be proactive in reviewing plan documents and procedures to ensure compliance.

Listen as our panel provides guidance on required procedures, disclosures and other necessary items of compliance, and the best practices in handling disability claims.

1. Modifications to Section 503 of ERISA impacting disability benefits claims and appeals process
2. The impact on health and welfare plans providing disability benefits
3. Considerations for pension plans providing early or reduced benefits in the event of disability
4. Applicability of new rule to non-qualified compensation plans
5. Best practices for plan sponsors to avoid compliance pitfalls

The panel will review these and other key issues:

• Identifying areas of concern based on the requirements of the final rule
• Determining the applicability of new requirements to current benefit plans
• Conducting an internal review of claims and appeals processes, plan language, and notices
• Implementing necessary modifications and plan amendments to maintain compliance
• Establishing disability claims procedures in compliance with ERISA Section 503