United Policyholders

381 Bush Street, 8th Floor

San Francisco, CA 94104

415.393.9990

www.uphelp.org

Board of Directors

Amy Bach

Executive Director

William H. Hedden 

President, Board of Directors

Consolidated Adjusting, Inc.

David Baria

Mississippi State Representative

Nicholas Casagrande

NC Financial Group

Jim Jones

HighGear Ventures

Brian S. Kabateck

Kabateck Brown Kellner LLP

E. Gerard Mannion

Mannion and Lowe

William “Chip” Merlin

Merlin Law Group

Susan Piper

Disaster Survivor

John Sullivan

Avaya

Alice J. Wolfson

DL Law Group

Ex Officio

Hon. Stanley G. Feldman

Chief Justice (RET)

AZ Supreme Court

Larry P. Ginsburg, CFP

Ginsburg Financial Advisors, Inc.

Deborah Senn

Insurance Commissioner (1993 -2001)

Washington State

William M. Shernoff

Shernoff Biddart Echeverria Bentley LLP

Programs

Advocacy and Action

Roadmap to PreparednessTM

Roadmap to RecoveryTM

A NON-PROFIT ORGANIZATION 

January	18,	2016

Assistant	Secretary	Phyllis	C.	Borzi

Office	of	Regulations	and	Interpretations

Employee	Benefits	Security	Administration

Room	M-5655

U.S.	Dept.	of	Labor

200	Constitution	Avenue	NW

Washington	D.C.	20210

VIA	EMAIL	AND	ELECTRONIC	SUBMISSION	to	e-ORI@dol.gov;	http://www.regulations.gov

Re:	Claims	Procedure	Regulations	for	Plans	Providing	Disability	Benefits

RIN	No.	1210-AB39

Regulation:	29	C.F.R.	§2560.503-1

Dear	Assistant	Secretary	Borzi:

We	respectfully	request	your	review	and	acceptance	of	the	attached	comments	regarding	

RIN	No.	1210-AB30.		UP	is	a	non-profit	organization	that	informs,	helps	and	speaks	for	

insurance	consumers	nation	wide.		Our	Executive	Director	is	a	member	of	the	Federal	

Advisory	Committee	on	Insurance and	an	official	consumer	representative	to	the	National	

Association	of	Insurance	Commissioners.

UP	is	funded	by	donations	and	grants.	UP’s	work	is	done by	volunteers,	claims	professionals,

and	a	small	paid	staff.	UP	does	not	sell	insurance	or	accept	funding	from	insurance	

companies.	At	www.uphelp.org,	UP	offers	a	variety	of	resources	and	tools	that	help	people	

make	good	decisions	when	buying insurance	and	resolving	claim		and	coverage	disputes.

UP	regularly	appears	as	amicus	curiae on	behalf	of	consumers	in	ERISA	matters	and	did	so	in	

Heimeshoff	v.	Hartford	Life	&	Accid.	Ins	Co.,	134	U.S.	604	(2013).	A	library	of	UP’s	amicus	

curiae briefs	is	available	at	www.uphelp.org/amicus.		

Our	comments	were	prepared	by	pro	bono counsel	Glenn	R.	Kantor,	Esq.	of	Kantor	and	

Kantor,	LLP	on	behalf	of	UP	and	we	hereby	submit	them.

Sincerely,

		

Amy	Bach,	Esq.

Executive	Director
1

KANTOR &KANTOR, LLP

ATTORNEYS AT LAW

19839 NORDHOFF STREET

NORTHRIDGE, CA 91324

TEL: (818) 886-2525

FAX: (818) 350-6272

Attorneys for United Policyholders

January 18, 2016

Office of Regulations and Interpretations,

Employee Benefits Security Administration

Room M-5655

U.S. Dept. of Labor

200 Constitution Avenue NW

Washington D.C. 20210

Re: Claims Procedure Regulations for Plans Providing Disability Benefits

RIN No.: 1210-AB39

Regulation: 29 C.F.R. §2560.503-1

Dear Assistant Secretary Borzi:

I have organized the following comments as follows. First, I address the most important 

substantive issues for the DOL to address as it finalizes the proposed regulations. These 

comments relate to where I believe the DOL should make a substantive change in the proposed 

regulations. Second, I have set out what I see as the most important technical issues in the 

proposed regulations. These are matters that do not change the substance of a proposed 

regulation but request language changes for purposes of greater clarity or conformity with other 

regulations.

I. Comments on Substantive Matters in the Proposed 

Regulations

Comment on Notice for Applicable Statute of Limitations

The DOL has invited comment in the statute of limitations issues that have developed since the 

Supreme Court’s decision in Heimeshoff v. Hartford Life & Accid. Ins Co., 134 U.S. 604 (2013). 

I agree that this is a crucial area for regulation as the Heimeshoff decision has created confusion 

and much litigation. The DOL can assist by creating standards for what is a reasonable planbased limitations provision in the same way that the DOL used its regulatory power to create 

timing deadlines for the claims process in prior versions of the regulations. Since Heimeshoff left 

open the possibility that an internal limitations period could run before the appeals process is 
2

complete (even where exhaustion is mandatory), the DOL is in a good position to clarify that 

such an approach would violate full and fair review required by 29 U.S.C. §1133. Additionally, 

because contractual limitations periods are plan terms, the claimant should receive notice about 

the limitations period from the plan just as is the case with other plan terms. As the DOL aptly 

points out in the preamble to these proposed regulations, plan administrators are in a better 

position to know the date of the expiration of the limitations period and should not be hiding the 

ball from claimants if the plan administrator is functioning as a true fiduciary. 

One court has interpreted the existing regulations to require notice of the expiration of a

limitations period. Kienstra v. Carpenters' Health & Welfare Trust Fund of St. Louis, No. 

4:12CV53 HEA, 2014 WL 562557, at *4 (E.D. Mo. Feb. 13, 2014), aff'd sub nom. MunroKienstra v. Carpenters' Health & Welfare Trust Fund of St. Louis, 790 F.3d 799 (8th Cir. 

2015)(“[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) of [ERISA] following an adverse benefit determination on review.” 29 C.F.R. § 

2560.503–1(g)(iv)). This is a minority perspective. Here, the DOL should do more than interpret 

its own rules; it should re-write them to remove any ambiguity. 

I recommend an amendment to the regulations governing the manner and content of notification 

of benefit determinations on review. 29 C.F.R. §2560.503-1(j) [proposed regulation]. The 

amended language should require the claims administrator to notify the claimant of the date of 

the expiration of any plan based limitations period and should include a definition of what is a 

reasonable limitations period. Such an alteration takes care of the different courts’ views on 

when claims “accrue” in that it makes clear that no limitations period can start before the internal 

claim and appeals process is complete. It also makes clear that there will be at least a one-year 

period after the completion of the plan’s appeals process in which a claimant can file suit. The 

justification for this rule is that it would cut down on litigation devoted to the threshold issue of 

the running of the limitations period. In addition, it may well lead to a standardization of internal 

limitations periods that would be salutary for both claimants and plan administrators. 

Accordingly, I propose amending the proposed regulation by adding a section as follows and 

renumbering accordingly (added language is indicated by bolding and underlining):

29 C.F.R. 2560.503-1 (j)(6) [proposed regulation]

In the case of an adverse benefit decision with respect to disability 

benefits— (i) A discussion of the decision, including, to the extent that the 

plan did not follow or agree with the views presented by the claimant to 

the plan of health care professionals treating a claimant or the decisions 

presented by the claimant to the plan of other payers of benefits who 

granted a claimant’s similar claims (including disability benefit 

determinations by the Social Security Administration), the basis for 

disagreeing with their views or decisions; and (ii) Either the specific 

internal rules, guidelines, protocols, standards or other similar criteria of 

the plan relied upon in making the adverse determination or, alternatively, 
3

a statement that such rules, guidelines, protocols, standards or other 

similar criteria of the plan do not exist.

(7) In the case of an adverse benefit determination on review with 

respect to a claim for disability benefits, a statement of the date by 

which a claimant must bring suit under 502(a) of the Act. However, 

where the plan includes its own contractual limitations period, the 

contractual limitations period will not be reasonable unless: 

a. it begins to run no earlier than the date of the claimant’s 

receipt of the final benefit determination on review including any 

voluntary appeals that are taken;

b. it expires earlier than 1 year after the date of the claimant’s 

receipt of the final benefit determination on review including any 

voluntary appeals that are taken;

c. the administrator provides notice to the claimant of the date 

that the contractual limitations period will run; and

d. the contractual limitations period will not abridge any existing 

state limitations period that provides for a period longer than one 

year. 

(8) In the case of an adverse benefit determination on review with respect 

to a claim for disability benefits, the notification shall be provided in a 

culturally and linguistically appropriate manner (as described in paragraph 

(p) of this section).

Comment on Timing of Right to Respond to New Evidence or Rationales

The DOL clearly wishes to improve things for claimants who are ambushed with new rationales 

or evidence during review on appeal. I commend this effort, since sandbagging has been a 

persistent problem in the ERISA appeals process and some courts have not appreciated how 

prejudicial this is to claimants. In Abram v. Cargill, 395 F.3d 882, 886 (8th Cir. 2005), the court 

articulated the problem as follows:

[w]ithout knowing what “inconsistencies” the Plan was attempting to resolve or 

having access to the report the Plan relied on, Abram could not meaningfully 

participate in the appeals process. . . This type of “gamesmanship” is inconsistent 

with full and fair review. 

Id. Given that it is often very hard to supplement the record in litigation, the proposed change 

offers some assurance that a claimant can contribute his or her relevant evidence to the record 

that the court will review. Where the claimant, as plaintiff, has the burden of proof on most 
4

issues, this only makes sense. In most litigation contexts, the party with the burden of proof is 

given the last word. Here, giving the last word to the claimant during the claims appeal process 

is, in effect, giving claimant the right of rebuttal in litigation. 

There is, however, a countervailing concern that while this extra opportunity to submit proof to 

the plan exists, claimants will be extending their time without benefit payments. This is a 

problem that already exists and could be exacerbated. Plans have protested that giving the 

claimant the last word will make the internal appeals processes go on forever. This argument is 

out of touch with the reality of being an ERISA disability benefits claimant. These claimants, in 

my experience, would not continue the process ad nauseum while they are unable to pay their 

mortgages and feed their families.

The following suggestion places reasonable limits on both claimants and plan administrators and 

responds to the concern that claimants will have to wait too long for determinations on review. 

While claimants will want to make fast work of their responses because they are usually without 

income during this process, the type of evidence they often need to respond to new evidence or 

rationales by the plan may require hiring an expert such as another physician, psychologist, or 

vocational consultant. These professionals are not always readily available for quick turnarounds and, depending on the new information such experts are responding to, they may need 

weeks to evaluate the new information. For this reason, claimants should have at least 60 days to 

respond to new evidence or rationales provided by the plan on appeal. Moreover, the period for 

the decision on review to be completed should be tolled during this 60-day period. When the 

claimant has responded, the plan administrator should be allowed whatever time was left under 

the existing regulations or 30 days, whichever is longer, to issue its determination on review.

This rule should apply whether the new information is a new “rationale” or new “evidence.” 

Accordingly, I suggest the following amendment to the proposed regulation (new language 

indicated by bolding and underlining):

2560.503-1(h)(4)(ii) [proposed regulations] 

(ii) Provide that, before the plan can issue an adverse benefit 

determination on review on a disability benefit claim, the plan 

administrator shall provide the claimant, free of charge, with any new or 

additional evidence or rationale considered, relied upon, or generated by 

the plan (or at the direction of the plan) in connection with the claim; such 

evidence must be provided as soon as possible and sufficiently in 

advance of the date on which the notice of adverse benefit determination 

on review is required to be provided under paragraph (i) of this section to 

give the claimant a reasonable opportunity to respond prior to that date. 

Such new evidence or rationale must be provided to claimant before 

the decision on appeal is issued and the claimant must be afforded 

up to 60 days to respond. The time to render a determination on 

review will be suspended while the claimant responds to the new 

evidence or rationale. After receiving the claimant’s response to the 

new evidence or rationale or notification that the claimant will not be 

providing any response, the plan will have whatever time was left on 
5

the original appeal resolution time period or 30 days, whichever is 

greater, in which to issue its final decision.

Independence and Impartiality - Avoiding Conflicts of Interest

Alternative A

The proposed regulation regarding the impartiality of claims personnel is essential and I applaud 

the DOL’s effort to minimize the effect that biased individuals have on the claims and appeals 

process. However, the proposed regulation needs clarification in three areas.

First, the proposed regulation should make clear that impartiality is ensured, even where the 

plan, itself, is not directly responsible for hiring or compensating the individuals involved in 

deciding a claim. This clarification is necessary because, as a practical matter, plans frequently 

delegate the selection of experts to third-party vendors who, in turn, employ the experts. 

Second, clarification is needed concerning which individuals are “involved.” Claims 

administrators often protest that physicians, or other consulting experts, are not “involved in 

making the decision” but merely supply information (such as an opinion on physical restrictions 

and limitations) that is considered by the claims adjudicator. Under this logic, plans may argue 

that consulting experts are not affected by the impartiality regulation. 

Finally, the proposed regulation should make clear that not only claims adjudicators and 

consulting physicians must be impartial. Vocational experts and accountants are also frequently 

used in the claims process and should be included in the scope of the impartiality requirement. 

In light of these concerns, I suggest that the proposed regulation language be amended as follows 

(added language is bolded and underlined): 

29 C.F.R. §2560.503-1(b)(7) [proposed regulation]

In the case of a plan providing disability benefits, the plan and its agents, 

contractors, or vendors (such as any entities who supply consulting 

experts to plans) must ensure that all claims and appeals for disability 

benefits are adjudicated in a manner designed to ensure the 

independence and impartiality of the persons involved in making the 

decision or who are consulted in the process of making the decision. 

Accordingly, decisions regarding hiring, compensation, termination, 

promotion, or other similar matters with respect to any individual, (such as 

a claims adjudicator, vocational expert, accounting expert, or medical 

expert) must not be made based upon the likelihood that the individual will 

support the denial of benefits.

Alternative B
6

The proposed regulation appears to prohibit the plan from employing claims adjudicators or 

experts who are conflicted. However, the regulation could use some more teeth to prevent 

disagreements and litigation over mixed motives for using these individuals. The regulation 

should make clear that if the conflict plays any part in the decision to retain, hire, or compensate 

the claims handler or other expert, the decision would violate the regulations. In light of these 

concerns, I suggest that the proposed regulation language be amended as follows (added 

language is bolded and underlined): 

29 C.F.R. §2560.503-1(b)(7) [proposed regulation]

Accordingly, decisions regarding hiring, compensation, termination, 

promotion, or other similar matters with respect to any individual (such as 

a claims adjudicator or medical expert) must not be made based upon the 

likelihood, in whole or in part, that the individual will support the denial of 

benefits.

Opportunity to Supplement the Record

Although the EBSA has not chosen to regulate about this, it should do so. Many meritorious 

disability claims are denied and the courts affirm these determinations because of issues 

regarding the scope of the record on review in the court. For instance, Social Security Disability 

Insurance decisions, which are the focus of some of the proposed rules, are often crucial to 

proving disability claims. However, the Social Security Administration (“SSA”) takes time in 

issuing its decisions and the SSA’s ruling may sometimes come after the final denial on appeal 

of the disability plan. This is true as well for other kinds of evidence. Even where it would not 

be a problem to do so, plan administrators often refuse to consider this type of evidence, 

choosing instead to shut the door on a meritorious claim. Meanwhile, plans will often 

counterclaim to recover the offset that is provided by the SSA benefit. Metropolitan Life Ins. 

Co. v. Glenn, 554 U.S. 105 (2008). Sometimes a claims administrator may rush an appeal 

decision through simply to avoid the claimant being awarded SSDI and having that evidence in 

the claims file. There is a clear solution to this that would track the Fifth Circuit’s en banc 

holding in Vega v. National Life Ins. Serv., Inc., 188 F.3d 287, 300 (5th Cir. 1999), where the 

Court wrote:

We hold today that the administrative record consists of relevant information 

made available to the administrator prior to the complainant's filing of a lawsuit 

and in a manner that gives the administrator a fair opportunity to consider it. 

Thus, if the information in the doctors' affidavits had been presented to National 

Life before filing this lawsuit in time for their fair consideration, they could be 

treated as part of the record. Furthermore, in restricting the district court's review 

to evidence in the record, we are merely encouraging attorneys for claimants to 

make a good faith effort to resolve the claim with the administrator before filing 

suit in district court; we are not establishing a rule that will adversely affect the 

rights of claimants.
7

Id. In light of this holding from Vega, I recommend a rule that would require the plan 

administrator to accept and review evidence and treat it as part of the record, so long as it is sent 

in time for the administrator to consider the evidence before litigation is commenced.

Discussion of the Decision and Its Relationship to SSDI or other Disability Awards 

Alternative A

The regulation as presented, requiring a claims administrator to meaningfully distinguish the 

views of treating physicians or other entities that are paying benefits, will be helpful. Often, 

administrators ignore evidence that is favorable to the claimant. Generally, if the administrator 

pays any attention to contrary opinions, my clients receive pre-packaged or boilerplate 

paragraphs in the denial letters that have nothing to do with their claims. Because of this they 

cannot mount a response. This stands in the way of full and fair review. Sometimes courts do 

not understand the difference between the type of explanation required by ERISA and these 

empty paragraphs. Assuming that this regulation is intended to change plans’ reliance on this 

sort of explanation or a wholesale failure to address the contrary evidence, I am in favor of the 

regulation. 

Alternative B

The regulation requiring a discussion about the difference between the plan’s decision and 

awards made by other systems, such as Social Security, should be expanded to set forth a 

deferential review requirement. The regulation could utilize the same language as the regulatory 

settlement agreements that have been used by many state insurance commissioners in response to 

concerns about disability claims processes used by insurers such as UNUM. For example, in the 

regulatory settlement agreement UNUM was required to follow, this language was used:

The Companies must give significant weight to evidence of an award of 

Social Security disability benefits as supporting a finding of disability, 

unless the Companies have compelling evidence that the decision of the 

Social Security Administration was (i) founded on an error of law or an 

abuse of discretion, (ii) inconsistent with the applicable medical evidence, 

or (iii) inconsistent with the definition of disability contained in the 

applicable insurance policy.

Including similar language in the proposed regulation would be helpful to assure that plans give 

the appropriate weight to an award made by another entity.

II. Comments on Technical Matters in the Proposed Regulations

Effective Date of Proposed Regulation
8

To avoid the application of the previous regulations to disability claims that are already in 

process before the effective date, I suggest the following text be added:

The regulations shall apply to all claims pending with the plan 

fiduciary on or after the date that the regulations go into effect.

The holding in Abram v. Cargill, 395 F.3d 882 (8th Cir. 2005), was seriously undermined when 

the Eighth Circuit later concluded that its decision in Abram was grounded in the pre-2000 

version of the claims regulations and would not apply to cases decided under the post-2000 

claims regulations. See Midgett Washington Group Int’l LTD Plan, 561 F.3d 887, 894-96 (8th 

Cir. 2009). To avoid this sort of problem occurring again, the above suggested language should 

be added to the proposed regulations.

Notice of Right to Request Relevant Documents

The regulation concerning notice of the right to request relevant documents contained in 29 

C.F.R. §2560.503-1(g)(1)(vii)(C) [proposed regulation] is an improvement since it was formerly 

missing from the regulation. However, it would be more helpful to claimants to use the words 

“claim file,” which is plain language and is consistent with the amendment at 29 C.F.R. 

§2560.503-1(h)(4)(i) [proposed regulation]. Attorneys understand the language of (g)(1)(vii)(C), 

but lay persons, who are the actual participants and often not represented, may not realize what 

rights are given here. 

Accordingly, I suggest the following amendment to the proposed regulation (added language is 

underlined and bolded):

29 C.F.R. §2560.503-1(g)(1)(vii)(C)[proposed regulation]

A statement that the claimant is entitled to receive, upon request and free 

of charge, reasonable access to the claimant’s claim file, including

copies of all documents, records, and other information relevant to the 

claimant's claim for benefits. Whether a document, record, or other 

information is relevant to a claim for benefits shall be determined by 

reference to paragraph (m)(8) of this section.

Deemed Exhaustion Drafting Issue

This regulation should be edited to clarify that the deemed exhausted provision applies to both 

claims and appeals, not just “claims.” Presumably, if there is a violation of the regulations, the 

claimant can seek review regardless of whether the claim is in the “claim” or the “appeal” stage. 

I suggest the following clarifying language (added language is bolded and underlined):

29 C.F.R. §2560.503-1(l)(2)(i) [proposed regulation]
9

In the case of a claim for disability benefits, if the plan fails to strictly 

adhere to all the requirements of this section with respect to a claim or 

appeal,

Deemed Exhaustion of Claims and Appeals Processes

I am pleased that the DOL has undertaken to clarify the consequences that will result when the 

plan does not comply with the procedural requirements of the regulations. The DOL has wisely 

separated the consequences into two categories, i.e. for serious violations and for minor 

violations. I see four areas that could be improved in the proposal. 

First, the standard of judicial review that will apply requires clarification because there is a 

potential conflict between language in the preamble and the proposed regulation. The preamble 

says: “in those situations when the minor errors exception does not apply, the proposal clarifies 

that the reviewing tribunal should not give special deference to the plan's decision, but rather 

should review the dispute de novo.” The underscored language clearly contemplates that a court 

should exercise de novo review. However, the regulation itself says: “if a claimant chooses to 

pursue remedies under section 502(a) of ERISA under such circumstances, the claim or appeal is 

deemed denied on review without the exercise of discretion by an appropriate fiduciary.” 29 

C.F.R. §2560.503-1(l)(2)(i) [proposed regulation]. I anticipate that plans will argue that this 

underscored language does not go far enough to require a court to exercise de novo review. For 

example, this language could mean simply that the plan did not make a decision and another plan 

review would be ordered rather than de novo judicial review. To avoid a potential ambiguity on 

this point, I suggest the following amendment to the proposed regulation (added language is 

bolded and underlined): 

29 C.F.R. 2560.503-1(l)(2)(i) [proposed regulation]

if a claimant chooses to pursue remedies under section 502(a) of ERISA 

under such circumstances, the claim or appeal is deemed denied on 

review without the exercise of discretion by an appropriate fiduciary, and 

the reviewing tribunal should not give special deference to the plan's 

decision, but rather shall review the dispute de novo.

Second, the portion of the proposed regulation concerning refiled appeals requires clarification. 

The claimant whose appeal is refiled may need to supplement the record for the refiled appeal, 

since it is possible that his or her attempt to communicate with the plan was thwarted in some 

way. I suggest amending the regulation to require the plan to give the claimant notice of his or 

her right to supplement the appeal. 

Third, the phrase “reasonable time” is sure to engender disputes and differing interpretations. It 

would be better to specify a period of time. Ten (10) days seems reasonable. 

Finally, for the same reasons as described above with regard to the appropriate standard of 

judicial review, it would be beneficial to specify the standard of judicial review is de novo when 
10

the court does not remand. I suggest the following amendment (added language is bolded and 

underlined, deleted language shown by strikeout):

29 C.F.R. 2560-503-1(l)(2)(ii) [proposed regulation]

If a court rejects the claimant’s request for immediate review under 

paragraph (l)(2)(i) of this section on the basis that the plan met the 

standards for the exception under this paragraph (l)(2)(ii), the claim shall 

be considered as re-filed on appeal upon the plan’s receipt of the decision 

of the court. Within a reasonable time ten (10) days after the receipt of the 

decision, the plan shall provide the claimant with notice of the 

resubmission and notify the claimant of the right to supplement the 

appeal if she chooses. If the court accepts the claimant’s request for 

immediate review, the court will retain jurisdiction and decide the 

case applying de novo review.

Right to Claim File and Meaning of Testimony

There is unclarity concerning what manner of “testimony” is contemplated by the new 

regulations.

In the preamble to the proposed regulations, the DOL has stated: “the proposal would also grant 

the claimant a right to respond to the new information by explicitly providing claimants the right 

to present evidence and written testimony as part of the claims and appeals process.” Note the 

underscored language refers to “written testimony.” But the actual proposed regulation uses this 

phrasing: “[the processes for disability claims must] allow a claimant to review the claim file 

and to present evidence and testimony as part of the disability benefit claims and appeals 

process.” 29 C.F.R. §2560.503-1(h)(4)(i)[proposed regulation]. Here the regulation refers to 

“testimony” without limiting the type of testimony to “written” testimony.

By comparison, the current regulation uses the following language: “[the process must] provide 

claimants the opportunity to submit written comments, documents, records, and other 

information relating to the claim for benefits.” 29 C.F.R. 2560.503-1(h)(ii)(2)[current 

regulation].

Hence, there is an inconsistency between the preamble and the proposed regulation in that the 

preamble specifies “written testimony” whereas the proposed regulation just says “testimony.” 

This could lead to costly disagreements over whether the regulation contemplates actual live 

testimony, i.e. a hearing. 

Furthermore, under the current regulation sometimes claimants submit testimony in the form of 

an audio or video CD. This is particularly useful in cases where the claimant cannot read or 
11

write so that a written statement is impossible. It is also helpful in those cases where actually 

seeing the claimant might be important. As such, I am concerned that the reference to “written 

testimony” in the preamble might give plans the ammunition to disallow any audio or video 

submissions on the grounds that these forms of evidence do not represent “written evidence.” If 

this were the interpretation given to the language in the proposed regulation, it would actually 

put claimants in a worse position than they face at present. 

Further, the proposed regulation’s verbiage, i.e. “evidence and testimony” could be interpreted to 

impose courtroom evidentiary standards for claimants submitting proof of their claim –

something that is not normally applied in the ERISA context. Plans are in a position to observe 

rules of evidence as they have in-house counsel and other legal resources to rely upon to assure 

compliance with the rules of evidence. But claimants, who are often representing themselves, 

are not equipped to understand, much less apply, the usual evidentiary standards suggested by 

the phrase “evidence and testimony.” The agency needs to make clear that it is not curtailing or 

narrowing the types of information that claimants may submit to the administrator. 

III. Other Issues of Concern with the Regulations

Adverse Benefit Determination to Include Rescission

Alternative A

An addition to the regulation that an adverse benefit determination includes an adverse decision 

on coverage is necessary. However, I question whether the definition of “rescission” in 29 

C.F.R. §2560.503-1(m)(4)(ii) [proposed regulation] is sufficient to cover the situation where the 

plan asserts that coverage never existed in the first place. Coverage disputes regarding disability 

benefits should be appealable by the claimant as a matter of full and fair review. I suggest the 

following amendment (added language indicated by bolding and underlining):

29 C.F.R. §2560.503-1(m)(4)(ii) [proposed regulation]

In the case of a plan providing disability benefits, the term “adverse benefit 

determination” also means any rescission of disability coverage with 

respect to a participant or beneficiary (whether or not, in connection with 

the rescission, there is an adverse effect on any particular benefit at that 

time). For this purpose, the term “rescission” means a cancellation or 

discontinuance of coverage or any other repudiation of coverage that 

has retroactive effect, except to the extent it is attributable to a failure to 

timely pay required premiums or contributions towards the cost of 

coverage.

Alternative B

The proposed language regarding treating rescissions as adverse benefit determinations should 

be expanded to encompass any situation where a limitation is invoked so that the claimant can 

immediately appeal. For instance, a plan may approve benefits but may invoke a temporal 

limitation that exists in the plan, such as a mental illness limitation. Many insurers defer the 

right to appeal until the date that benefits end, which imposes significant economic hardship on 
12

claimants who may then be deprived of benefits for several months while appeals proceed. The 

claimant should have the option to immediately appeal that determination to avoid the economic 

hardship in the future. 

Disclosure of Internal Rules etc.

The DOL’s proposed regulation regarding disclosure of the internal rules or criteria used to make 

a disability benefit decision, 29 C.F.R. §2560.503-1(g)(1)(vii)(B)[proposed regulation], is 

helpful because internal rules, guidelines, protocols, standards, claims manuals, and similar 

materials often create hidden plan terms that the claimant is unable to learn of or discover in 

order to address them in the appeal. As is true in the healthcare context, plans sometimes argue 

that internal criteria are confidential or proprietary. But keeping the rules that are used to 

administer a plan a secret is inconsistent with the most basic premise of ERISA. Benefits must 

be administered “in accordance with the documents and instruments governing the plan.” 29 

U.S.C. §1104. In addition, much litigation would be avoided if the claimant could know what 

criteria he or she needed to meet in an appeal See e.g. Cook v. New York Times Co. Long-Term 

Disability Plan, 2004 WL 203111, at *10 (S.D.N.Y. Jan. 30, 2004); Craig v. Pillsbury, 458 F.3d 

748, 754 (8th Cir. 2006)(decrying the use of “double-secret” plan terms); Samples v. First Health 

Group Corp., 631 F. Supp. 2d 1174, 1183 (9th Cir. 2007). Given that the regulations require 

adverse benefit determinations to include the reasons for the denial and the applicable plan 

terms, this additional requirement should not be onerous and would promote the dialogue 

between claimant and plan that ERISA contemplates. Booten v. Lockheed Med. Ben Plan, 110 

F.3d 1461, 1463 (9th Cir. 1997)(“in simple English, what this regulation calls for is a meaningful 

dialogue between ERISA plan administrators and their beneficiaries.”).

Venue Selection Provisions Inconsistent with ERISA

There is a serious issue that is not addressed in the proposed regulations that should be 

considered. The regulations should make clear that ERISA’s broad venue provision cannot be 

thwarted by contrary plan or policy provisions. Some courts have permitted plans to draft 

around ERISA’s venue requirements. At a minimum, the present state of the law means that 

there will continue to be litigation on this question before the merits of a dispute can even be 

reached. Venue selection clauses are mostly used to disadvantage ERISA claimants in litigation 

or create barriers to their statutory right to sue. McQuennie v. Carpenters Local Union 429, No. 

3:15-CV-00432, 2015 WL 6872444, at *5 (D. Conn. Nov. 9, 2015)(pro se litigant allowed to sue 

in home state of Connecticut because he could not afford to travel to California); but see, Turner 

v. Sedgwick Claims Mgmt. Servs., No. 7:14-CV-1244-LSC, 2015 WL 225495 (N.D. Ala. Jan. 

16, 2015). In Turner the court encouraged the agency to regulate in this area as opposed to filing 

amicus briefs in some cases and not others. Id. at 21(“[a]lso underwhelming is that the Secretary 

has expressed his view only rarely, through the ad hoc, highly informal means of amicus briefs in 
13

private litigation, rather than in a regulation, an enforcement setting, or even in a published 

statement of policy or guidance.”). There is a fear that other courts will take this same point of 

view, which would harm disability claimants. 

Accordingly, I recommend that DOL propose a regulation requiring that in the final denial letter 

plans not only notify claimants of their right to sue and the date of the expiration of any internal 

limitations period but also of the statutory ERISA venue provision. 

Notice of Right to Retain Counsel for Appeal

Often ERISA claimants who have been wrongly denied disability benefits do not realize that 

they have the right to be represented in the administrative appeal process. Not knowing what 

evidence would have proven their claim to the plan administrator, and limited by the 

administrator or the court in submitting any new evidence in support of their claims in later 

litigation, they have often squandered their last, best opportunity to prove a meritorious claim. I 

propose that the DOL adopt a regulation that benefit denials must advise claimants of their right 

to hire an attorney to represent them in the appeal phase. The Social Security Administration 

does this. There is no reason to hide this right from claimants. 

Respectfully submitted,

Glenn R. Kantor

Individually and on behalf of United Policyholders