@) USCHER, QUIAT
USCHER € RUSSO,Pc.

MICHAEL E. QUIAT* ) NEW YORK OFFICE
JOSEPH A. RUSSO*
JOEL D. ZELKOWITZ"* 433 HACKENSACK AVENUE 43 West 43rd Street, Suite 166
— HACKENSACK, NJ 07601 New York, NY 10036-7424

ETHAN FINNERAN*

PATRICK X. AMORESANO* TELEPHONE (201) 842-7100 Telephone (212) 856-1214
oF Couns FAX (201) 342-1810 ARTHUR USCHER

_ OREM — www.uqur.com, (RETIRED)

*" ADMITTED TO NJ & PA BARS ‘WILLIAM USCHER

* CERTIFIED CIVIL TRIAL ATTORNEY (1959-2003)

December 11, 2017

Via Email: e-ORI@dol.gov

Office of Regulations & Interpretations

Employee Benefits Security Administration, Rm. M-5655
US Department of Labor

200 Constitution Avenue NW

Washington, D.C. 20210

Attn: Deputy Assistant Secretary Hauser

Re: Implementation of Claims Procedure Regulations
For Plans Providing Disability Benefits
RIN #1210-AB39
Regulation: 29 CFR §2560-503

Dear Sir:

I am writing to strongly oppose any attempt at further delaying the implementation of the
revised Disability Claim Regulations which are scheduled to go into effect on April 1, 2018.
(Final Regulation on Claim Procedure for Plans Providing Disability Benefits, 81 Fed. Reg.
92316 December 19, 2016).

Simply stated, the concerns raised by the industry about these essential modifications are
not new. Rather, these objections appear to be simply a re-argument of the merits of the final
Rules. Since these changes have been thoroughly vetted and considered in the context of the
policy choices of Congress, this department and the federal courts interpreting ERISA, further
re-hashing of these old arguments that have already been considered and rejected, is not
warranted.

I have handled hundreds of ERISA claims for beneficiaries over the past three (3)
decades as a practicing attorney in New York and New Jersey. I have seen first-hand what
damage the current regulatory scheme can cause to disabled individuals and their families. There
are real problems with the way ERISA affects every day citizens in this country and the changes
that have been made in these regulations are essential to provide ERISA claimants even the most


Office of Regulations & Interpretations
Employee Benefits Security Administration
December 11, 2017

Page 2

rudimentary due process protections which are readily available to our citizens in other areas of
the law. I have watched hundreds of clients suffer catastrophic personal and financial losses as a
result of the serious inequities which have evolved in the interpretation and enforcement of
ERISA and its underlying regulations. The current modifications made to these regulations are
absolutely essential to providing some modicum of fairness to the claims handling process.

Arguments about increased costs have already been considered before final adoption. It
was determined that costs would not outweigh the benefits. Nothing new in the way of probative
evidence on this issue has been offered by the industry, which would warrant re-consideration of
the issue. To the extent that the department needs verification on this issue, it need only refer to
its own Bureau of Labor statistics.

I think it is also significant to note that despite similar concerns about increased
premiums by the adoption of statutory bans on discretionary language clauses throughout the
United States, access and participation in such plans has increased according to the Bureau of
Labor statistics.

It also bears mentioning that two major insurance carriers (Unum and Cigna) have been
the subject of extensive investigations and regulatory action over the past two decades as a result
of their systematic abusive claims handling practices, much of which occurred under the auspices
of ERISA. Many of these abuses occurred as a direct result of the inadequate protections
afforded beneficiaries under federal law, and specifically under the DOL regulations here at
issue. This history further undermines the credibility of the industry’s “concerns” about
increased costs.

Indeed, history shows, and this department has recognized that disability claims
administrators have been needlessly adversarial towards ERISA claimants, notwithstanding their
so-called “fiduciary” status. The industry’s claim that these revised rules are bad for participants,
is simply not credible.

Moreover, to the extent that these increased protections bring ERISA disability claims
administration more in line with the reasonable expectations of employee beneficiaries, the costs
of same are far outweighed by the benefits to the individuals who need protection. I cannot tell
you how many clients have been truly shocked to learn how systematically unprotected they are
under ERISA’s deficient due process requirements. The proposed amendments seek to address
just a small aspect of those deficiencies, and are but a modest attempt at reform.

On balance, these revised regulations reasonably attempt not to provide important
protections where they currently do not exist. They are not onerous, they are not burdensome,
and they are not overbroad.


Office of Regulations & Interpretations
Employee Benefits Security Administration
December 11, 2017

Page 3

It bears repeating that these changes were enacted after a complete and exhaustive vetting
process pursuant to the Administrative Procedure Act. There is simply no reason to revisit the
matter again simply because the industry prefers to maintain the status quo regardless of its
impact on individuals.

It is respectfully submitted that the new regulations should be implemented as currently
scheduled, without any further delay.

Should you require any additional information or should you have any questions, please
feel free to call me.

M IGHAEL E. QUIAT
MEQ:reg }

GA\MBQ miscellaneous\Office of Regulations & Interpretations ltr 12-8-17.docx