JOHNSTON LAW OFFICE

131-A Stony Circle, Suite 500

Santa Rosa, California 95401

(707) 939-5299

Fax (707) 837-9532

e-mail: Richard.Johnston@Johnston-Law-Office.com

October 18, 2017

Via electronic mail transmission to e-ORI@dol.gov

Timothy D. Hauser

Deputy Assistant Secretary

United States Department of Labor

Office of Regulations and Interpretations

Employee Benefits Security Administration

Room M-5655

200 Constitution Avenue NW

Washington D.C. 20210

Re: Claims Procedure Regulations for Plans Providing Disability Benefits

Examination

RIN No.: 1210-AB39

Regulation: 29 CFR § 2560.503-1

Dear Deputy Assistant Secretary Hauser:

I write to comment on a proposed delay in implementation of amendments to claimsprocedure regulations for ERISA-governed disability benefit plans. These regulations interest me 

greatly because, in my law practice, I focus on representing claimants in disputes respecting 

these sorts of claims. I have considerable experience in how these regulations impact claimants 

and the claims process, as I have represented both claimants and institutional defendants in 

ERISA disability disputes over my 30-year legal career.

As I understand it the currently operative effective date of the amendments, January 1, 

2018, may be delayed until April 1, 2018. The stated basis for the delay is to allow for the 

insurance industry and related interests to conduct a study of the likely cost implications of the 

amendments. The industry’s goal, as I understand it, is to demonstrate that the cost-benefit 

analysis DOL performed in connection with the initial enactment of the amendments was 

somehow faulty.

DOL finalized the amendments only after a 60-day notice-and-comment period that

involved a great many comments from various stakeholders. Very well represented were 

insurers and ERISA plans, and the organizations that represent them. Cost issues associated with 

implementing the amendments constituted a primary focus of their submissions—which were

highly speculative, and rarely supported by valid and legitimate data. And many industry 

comments asked for more time to adjust to the new rules, a request that DOL has already

honored by significantly delaying the effective date at the outset.

The input that is to be facilitated by the proposed additional delay could have been 
Timothy D. Hauser

Re: Claims Procedure Regulations for Plans Providing Disability Benefits Examination

October 18, 2017

Page 2

contributed during the proper notice-and-comment period. Moreover, neither ERISA 

participants and beneficiaries nor their representatives have any way to respond to this input, 

since it is not being made publically available. We are not told why this post-notice-andcomment information is any more valid than what was submitted during the notice-andcomment period itself. But it is clear that industry representatives met with DOL personnel, and 

that the industry and certain members of Congress sent letters—the content of which are not 

transparently disclosed. And, the notably short 15-day notice-and-comment period for the 

proposed delay doesn’t allow sufficient time to make a FOIA request to learn what is influencing 

this process.

The contemplated industry study also appears to involve degraded transparency; it will

be hidden from the public. That notwithstanding, DOL proposes to revisit the question of how 

(and perhaps whether?) to protect participants’ and beneficiaries’ statutory and regulatory 

rights to reasonable procedures in the adjudication of their disability claims. Whether by design 

or merely in effect, the contemplated delay will permit an entirely unscientific massaging of 

facts to favor one set of interests over another. And participants and beneficiaries cannot

effectively comment or provide their own “study,” since they are not in possession of the source 

data, and could not muster the resources to process it even if they were.

As I understand it the contemplated study is expected to presage a significant premium

increase attributed to the amendments, a proposition that currently available facts render quite 

unlikely. And to the extent that premiums would have to be increased to avoid illusory coverage, 

ERISA participants and beneficiaries would likely welcome this (it benefits no one to pay 

marginally lower premiums for a product that is ultimately worthless); nor would it further

burden public programs. Even assuming a delay would prevent such an increase, costs will not 

outweigh benefits even in a worst-case scenario.

Delaying the effective date of the amendments makes no sense, and the contemplated 

process lacks transparency and undermines any sense of trust and fairness. I ask that the 

effective date for the amendments—already significantly delayed at the industry’s behest—

remain January 1, 2018.

Thank you for considering my input.

 

 

Very truly yours,

Richard Johnston

RJ/tlv