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Beware of insurance sold through the workplace

In 2002 I had an operation taking a few months temporary disability leave. Unfortunately, after my return, there were complications that made it impossible to work longer than 4 hours per day and, I was unable to do many of my normal job duties.

The first evil was my employer who, unwilling to accept my physical limitations, began to dispute my doctor's assessment of my inability to perform full duties. They began to downgrade my performance ratings when I had always received good ratings prior to my disability and, continued to pressure me to work beyond my physical limitations.

The abuse continued until I filed a complaint with the Department of Fair Housing and Employment obtaining a right to sue letter for discrimination based on a disability. My employer retaliated by insisting they needed to "transfer my position to Seattle".

They then sent me notice that they would no longer accomodate my disability and instructed me to file a disability claim (purchased through my employer but paid entirely by me and fully insured by AETNA).

Upon departure, they refused to continue my medical at employee rates (per their benefit policy for disability); cheated on their share of 401k contributions and conspired with Aetna to deny the long-term disability claim by falsely characterizing my departure as a "lay-off". Aetna thereafter refused to recognize my disability claim, the disability notice from my employer or respond in any manner.

The second evil is called ERISA; a little understood but very important federal law that allows insurance to be sold through the workplace without regulatory oversight or any penalties for unreasonable claim denials; even fraud!

Congress enacted ERISA in 1974 and neither political party has been willing curb the abuse due to large campaign finance contributions from the insurance industry. The insurance industry has done well protecting and concealing unconscionable acts under "ERISA Savings" while continuing to expand opportunities for unjust enrichment at the expense of the American worker.

Initially, I couldn't understand why the Department of Insurance would not assist me (they wouldn't even tell me why). Finally an advisor told me that they cannot touch a company that makes any claim of being federally "protected" by ERISA.

My only option was to hire an attorney that specializes in ERISA law as it is a snake pit of "regulations" that defies logic. The fee is 40% of benefits awarded (or conceded at the court house steps) while the court will not award reasonable time at a reasonable rate. Additionally, not everyone is fortunate to earn a salary that will make the attorney's services profitable. Those in greatest need are most likely to forfeit benefits under ERISA.

Despite 3 years of my battling the insurance company, there remains an underpayment in benefits of about $40,000 (and counting) due to fraud that has become a routine practice of insurance companies with ERISA impunity.

The Department of Labor (supposedly) regulates insurance sold through an employer but; they have no enforcement powers and a response to a consumer's complaint is "voluntary". Since 1997 the Department of Labor no longer requires that "ERISA protected" insurance policies be publicly filed. Obviously the insurance carrier can now easily change the terms of the policy as it suits them with little fear of exposure.

In 2002 I requested and received a copy of my disability policy. After a 2005 appeal to the insurance company stating that I remain underpaid for full benefits per the policy, Aetna sent a revised policy with identical issue and effective dates as the first version but; they altered the policy language to justify the underpayment.

Aetna could not ignore extensive advertising of the policy provision in question so, they stated that they had honored the terms prior to 2000 but insisted that this was changed prior to my disability. When a different claim was made for underpayment that the second version of the policy did not cover, Aetna then quoted portions of the first version of the policy sent to me in 2002 because the first version better suited their reasons for denial of the second claim.

In the same letter they quote portions of the first then the second version of the policy; mixing language from two versions of one policy as it suits them.

ERISA controls all benefits and insurance sold through the workplace; health, pensions and life insurance included. In 1998 an internal video of AETNA lawyers instructing their claims adjusters to deny ERISA disability claims with little review (because the law protects them from legal exposure) was placed under "protective order".

The order was lifted in 1999 and shown to Congress by consumer watchdogs who pleaded for reform: Congress adjourned without a discussion.

The accounting methods used for pension funds would spell a prison term for anyone employing such methods under other circumstances but, only moderate and insufficient "reforms" have curbed the ERISA abuses seen at ENRON and Worldcom. The latest pension "reform" requires the employee to "opt out" of high risk 401K investments but few employees are aware of this: Fund managers will naturally favor the higher commissions over their fiduciary duties and there remains no meaningful penalty for abuse of fiduciary duties.

The taxpayers were required to bail out the airlines after 911 but, when it came to pensions, the Supreme Court allowed United to use their pension funds to pay off debt and default on pensions while Congress did nothing. The Pension Benefit Guarantee Corporation has told Congress that they will be bankrupt in 10 years but Congress has only slightly raised the insurance premiums an employer must pay to insure the fund:

This recent raise in premiums is insufficient and the first in 30 years. There is no incentive for a firm to be a good steward in managing pension funds.

Beware of employer "benefits" and insurance sold through the workplace; what you do not know CAN hurt you! ERISA protected insurance and pension benefits may not be worth the paper it is written on.




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