Someone Else Learns About ERISA the Hard Way
Posted on July 8, 2008
5 Comments
Seen on the AP wire:
But Spherion Corp., the temporary staffing company where Amschwand worked, told Amschwand-Bellinger she would not receive any of the $426,000 in benefits she believed she was due. When she went to court, Spherion succeeded in getting her lawsuit thrown out. The Supreme Court on June 27 refused to review the case.
Amschwand-Bellinger received a refund of the few thousand dollars in insurance premiums she and her husband dutifully had paid. The total, she said, would not cover the costs of his funeral.
The story has played out often under the federal Employee Retirement Income Security Act. Designed to protect employee benefits, the law has been used by employers as a shield against suits.
Federal appeals courts, interpreting Supreme Court decisions dating to 1993, consistently have said companies that offer health, life and retirement benefits under ERISA cannot be sued for large amounts of money, or damages. Instead, they can be sued only for typically smaller sums such as Amschwand’s insurance premiums.
Several federal judges have bemoaned the unfairness even as they have felt constrained to rule in favor of employers.
"The facts … scream out for a remedy beyond the simple return of premiums," Judge Fortunato Benavides of the New Orleans-based 5th U.S. Circuit Court of Appeals said in the Amschwand case. "Regrettably, under existing law it is not available."
I started this blog as a result of a gripe I have with the health plan I have at work. My employer’s been great through my family’s difficulties, but the runaround we’ve received from Aetna, acting as a TPA, has sucked.
They can get away with it, thanks to their ability to hide behind ERISA – they have no reason to behave.
The story quoted above provides a different example the problem with ERISA – an employer is able to hide behind the protections in the law; there is no incentive to treat employees fairly.
It’s a shame that folks don’t learn about the problems with ERISA usually until it’s too late. It’s such a nasty side of the employee benefits world which never has the purifying light of public sunshine directed its way.
Tags: Employers Behaving Badly, ERISA
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5 Responses to “Someone Else Learns About ERISA the Hard Way”
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Aetna does suck. I went on Short Term disability leave from my job for major spine surgery. Two days after my surgery, Aetna cancelled my insurance without my knowledge. I am to have Therapy, which they refuse to pay for. I still have another surgery I need. Due to them, I can not get them to pay for my disability leave pay which all I have to survive on, a whole $492 a month. And now they want me to pay them $414 a month for Cobra insurance. Thanks to them, I will be homeless and disabled for the rest of my life. Fed UP with Aetna, Lydia from Illinois
Aetna claimed that I did NOT need preapproval for my out-patient back surgery at Laser Spine Institute (did not say anything about it being experimental surgery). We paid CASH up front @ $30,000.00,and were denied the claim months later because Aetna deemed the operation to be experimental. NO help from LSI either and I’m sure they knew what the outcome was going to be. I got ###### BAD! Time to wake up people because it is only going to get worse.
Like JACE, we have been completely screwed over by Aetna and LSI – JACE and anyone, please contact me regardin a lawsuit against AETNA and LSI. LSI said they would gain pre=approval in writing and never did it. I think we may be able to help each other.
My email information is KStelzer@bellsouth.net
Iam waiting for a comp hearing an atena refuses to pay short term dis, now they are tellin me that i can use my ins, for the hip replacement, I know fmla is coming to an end, an will not have the surgury with out being paid short term dis, or untill worker comp acepts my claim,
I am just waiting for termination,cobra,to happen, they are not going to screw me any more, i am down to my last dollars an not going to be laying up with my leg cut of an have the bank tell me they are forclosing on my house,
my lawyer has already threated them with a bad faith law suit, at that point they told me to refile my claim,an send all the medical records ,i told them they already have them,so now i am waiting for the avaluation of records before they will pay my claim,bout 3 months now, an they are still playing this medical record game with me,
I think i will start recording all conversation with them, just tell them that “this conversation may be recorded” just to give me an extra bullit when i have a bad faith suit
ATTEN SUX!