In 1974, Congress passed a sweeping piece of legislation known as the Employee Retirement Income Security Act or “ERISA.” This landmark legislation was designed to protect retirement and employee welfare plans. Over the past few decades, ERISA has slowly been used by insurance companies as more of a weapon for avoiding paying benefits than a protective measure to help employees. To better understand the key provisions of ERISA and how they apply to you, it’s important to know what ERISA is and what it generally means for you, as the American worker.
At Burke Harvey, LLC, we are devoted to helping clients fight for the benefits they have earned. If you have been unjustly denied long-term care insurance benefits, call Burke Harvey, LLC today.
How ERISA Started
Throughout the first half of the Twentieth Century, companies would routinely withhold income from paychecks and place it into pensions or employee deferred compensation plans. Many unions would set up welfare trusts that offered rich benefits to employees, like health care, dental, retirement, short-term and long-term disability benefits, and much more. However, employees would work for decades only to find out the plans were insufficient to pay for retirement, or they would learn that the company had been mishandling the funds, leaving them destitute in retirement. This problem needed to be fixed. Hence, Congress passed ERISA.
Who Does ERISA Cover?
As of 2013, ERISA covered about 684,000 employer-sponsored retirement plans. According to the U.S. Department of Labor (DOL), ERISA also covered approximately 2.4 million health insurance plans and “welfare benefit plans.” In total, the DOL estimates that ERISA applies to about 141 million American employees and their beneficiaries.
ERISA does not cover all health and benefit plans, however. For instance, with a few exceptions, the following types of organizations are NOT covered by ERISA:
- Government employees/agencies
- Religious and church organizations
- Benefit plans set up only to provide worker compensation, unemployment, or disability benefits
- Excess benefit plans that are not funded
- Non-U.S. benefit plans set up to benefit non-resident aliens
How to Know if Your Benefits are Protected by ERISA
If you want to know if your benefit plans are protected by ERISA, it is pretty easy to find out. If you are employed by a large corporation with a self-insured health plan, you are almost certainly covered by ERISA. Likewise, the majority of large unions will fall under ERISA.
Take a look at your health plan. If your employer manages the plan and disburses payments, rather than the health insurance company that sponsors it, you are likely covered by ERISA.
Ultimately, you can simply call your plan administrator and ask. Most of your plan materials should include something explaining how ERISA applies or if your plan is excluded for some reason.
Key Provisions All Workers Should Understand
If covered by ERISA, there are a number of specific provisions that are designed to protect your rights. These include the following, although this is by no means an exhaustive list:
- Specific fiduciary responsibilities: Those who manage the plan are held to a fiduciary level of trust. This means they are charged with handling the plan funds in a responsible manner.
- Grievance procedures: The plan must have a specific and fair way to deal with issues that arise, such as benefit denials and appeals.
- Right to sue: If a plan denies benefits and the employee disagrees, the participating employee can sue the plan for breach of fiduciary responsibilities.
- COBRA Benefits: This benefit allows employees to continue their health plans after certain life events, including the loss of employment.
- HIPAA: The Health Insurance Portability and Accountability Act was an amendment that provided a host of protections to workers with pre-existing conditions.
What Happens if Benefits are Unjustly Denied?
If your access to benefits is denied or if the plan administrator unjustly denies you payments through health or disability plans, you likely will have a short amount of time within which to bring an appeal. When you and your family are fighting and struggling to get by, it can be a significant challenge to fight back against the very company that you depend on for financial support.
Fortunately, the law provides specific options for disputing to benefit denials and fighting for compensation. Do not expect it to be easy. Many of these plans are more than mom and pop shops. They are large, well-funded benefit administrators with a team of attorneys and accountants working hard to preserve assets. They will often spend considerable resources to deny benefits to deserving employees. If you are facing a denial, you deserve a team of aggressive and skilled attorneys on your side.
At Burke Harvey, LLC, we have spent decades helping people obtain the benefits they have worked so hard to earn. Call us today to schedule a free case evaluation, and find out if we can help you recover your benefits.