A four year Targeted Market Conduct Examination of CIGNA and Life Insurance Company of America (LINA),'s Disability Income Insurance Claim Handling Practices was just concluded by the Departments of Insurance of Maine, Massachusetts, California, Connecticut and Pennsylvania. Review the Regulatory Settlement Agreement of May 13, 2013. See CIGNA's discussion of this in its SEC filing. As a result of this close examination, significant changes must be made in their handling of disability claims, as set forth in the Regulatory Settlement Agreement. Cigna will pay significant fines and set aside 77 million dollars to pay disabled claimant's whose claims were denied.
This agreement is far-reaching in its application to ongoing disability claims managed by CIGNA because it creates a baseline of claims handling protocols which must be followed. We will use this benchmark in our review of our client's claims, not only administered by CIGNA and LINA, but all other companies, including Hartford, Reliance Standard, Prudential and Unum, to name a few.
The last time this occurred was in 2005, when all 50 states joined in a massive Market Conduct Study of Unum's claims handling practices. What emerged was the Multistate Regulatory Settlement Agreement, and the review of hundreds of thousands of claims denied during a certain time period.
Today, the plan of corrective action for CIGNA and LINA requires a remediation program applied to previously denied claims from Jan. 2009 through December 2010 for citizens of the states that participated in this examination.
In addition, CIGNA and LINA must take immediate corrective action which will apply across the board to all claims, no matter where the claimants reside. The corrective actions include:
1) giving the awards of SSDI benefits "significant weight" in a claimant's favor,
2) enhancing the procedures utilized for gathering of medical information, reviewing the medical information provided and documenting the claim personnel's conclusions,
3) establishing guidelines for the use of external medical resources in the use of IME or FCE evaluations. This includes utilizing individuals to conduct these examinations without regard to the results of previous IMEs and FCEs conducted by these individuals.
4) Additionally the companies will give "clear and express notice to claimants of the information to be provided by the claimants during claim review and on appeal.
Importantly, the "enhanced claim procedures" require that the companies will provide all professionals providing evaluations of the claimant's impairment all available medical, clinical and vocational evidence in the Disability Claim File, both objective and subjective concerning impairment.
The Monitoring States will conduct a re-examination of the issues addressed by the Agreement in March, 2015.
The agreement states that it does not constitute an admission of liability nor that CIGNA committed any wrongdoing or represented a pattern and/or business practice that would violate any insurance laws, statutes or regulations.
While we applaud this agreement as a step in the right direction, we wonder why all of the states including New Jersey did not participate in this action. We have handled hundreds of CIGNA/LINA claims at our firm, and there is a clear pattern of unjust denials of claims for disabled consumers of our state. We have appealed the wrongful denials, and even with significant evidence in support of the claims, CIGNA would often uphold the denials, forcing us to file litigation in Federal Court, where, we always have been able to obtain justice for our clients. Maybe CIGNA will now pay closer attention to its claims handling and less attention to the bottom line, saying themselves the obligation to pay claims.
Contact us at Bonny G. Rafel LLC to review your claim and help you obtain the long term disability benefits you deserve. We can help you with the Reassessment of your claim if you qualify under the Reassessment Program.