YATINDRA PANDYA, February, 2018
On January 5, 2018, the Department of Labor (DOL) announced April 1, 2018, as the applicability date for the final rule which revises regulations governing disability benefit claims (the “Final Rule”). Published in the Federal Register on December 19, 2016, the Final Rule revised the claims regulations governing disability benefits provided under employee benefit plans subject to the Employee Retirement Income Security Act (ERISA). For more details on the Final Rule, see the article by Tiffany Santos.
The Final Rule was originally scheduled to apply to disability claims filed on or after January 1, 2018. However, in November 2017, the DOL announced that the applicability of the Final Rule would be delayed 90 days from January 1, 2018, to April 1, 2018, to give stakeholders the opportunity to submit additional data on the costs and benefits of the Final Rule. Certain stakeholders and others had argued that the Final Rule would impose unnecessary regulatory burdens on plan sponsors and would significantly impair workers’ access to disability insurance benefits. For more background on the delay see the article by Yatindra Pandya and Jahiz Agard.
In its news release, the DOL stated it received approximately 200 comments from stakeholders on both sides of the debate during the 60-day comment window that ended on December 11, 2017. However, only a few commenters responded substantively to the DOL’s request for quantitative data, and those comments were insufficient to persuade the DOL to revise the Final Rule or delay its applicability date beyond April 1, 2018. Consequently, the enhanced protections afforded by the Final Rule apply to all disability claims filed after April 1, 2018, within the context of any ERISA plan, if benefits are provided based upon the plan’s finding of disability.
To ensure compliance with the Final Rule, plan sponsors and administrators should perform the following tasks, as applicable:
- Identify all ERISA plans which provide disability benefits
- Amend plan documents
- Review and revise claims and appeals procedures
- Notify plan participants of the changes
- Work with insurers and third-party administrators involved in administering plans that offer disability benefits
Feel free to contact the author of this article for more information and assistance.