CBS 5 Investigates With Anna Werner

(CBS 5) We want to hear from you! Send us your stories and comments on disability insurance. Click here to comment. 

From Sheri in California:

I realize this was aired several months ago, however, this is a topic which needs to remain in public view. Thousands of lives are destroyed by the insurance companies denial of claims.

Yes we do need to understand our policies. I know that the rules can be changed and have been changed. Therefore, even our policies are not written in stone. The problem is with a little law called ERISA. Erisa has been the insurance companies shield and until we have our congressmen repeal this law, the average person hasn't a chance.

This law protects the insurance company from settlement damages for their bad faith. In other words, they are protected against lawsuits. Get rid of Erisa and there will be an even playing field.


From Jeff in Lebanon, Missouri:

Thank you Jay and TJ who posted this link on the Living with ALS group! I, like Jay, have ALS for 15+ years and I have been on a ventilator for 11+ years and my wife who married me a year after my diagnosis since then we have had three daughters.

Like the second part of the story, in September 2007 my insurance company stopped my disability payments because THEY had failed to offset my payments for my DAUGHTERS receiving SS to help with their care and further claim I owed them over $60,000 in back payments for their mistake.

The stoppage of my disability caused us to have our home foreclosed on and we had to move away from my family who assisted with my care. After seeing your story online, I will now pursue a lawsuit.

Jeff wrote to us again to add this information and a link:

The story you did is especially prevalent in the ALS community and it has lead to some PALS (person with ALS) giving up and dying because they're concerned about their family's finances which is the real outrageous result of this money grab by the insurance companies.

You know it's people like TJ and my wife who are the true victims because as our caregivers they give so much up to care for us only to be punished like this financially which is compounded by things like my wife having a student loan grow from $25,000 to over $70,000 since they cannot work. These financial hardships are especially a slap in the face because they save the system hundreds of thousands by keeping us out of nursing homes.

Here's the link to our Yahoo group.

 



From Michael in San Francisco:

In response to Michelle: Unfortunately your argument lacks some important details. It's most likely you have not worked for a large corporation. I have been employed by two such corporations for the past 24 years, the past 10 for a competitor of AT&T.

Employer based disability is not insurance and the employee does not pay premium as you've described. It's an employee Benefit for which the company contributes to on your behalf and is often included in ones annual compensation summary.

Therefore, they are not obligated to supplant your wages when you're already receiving your pension or Social Security disability. I think Anna's investigation brings up more questions than answers; especially when you use incorrect terminology.


From Sandie in Half Moon Bay:



 

I have been disabled since 1987. At that time my LTD suggested I apply for SSI. They also advised that I would most likely be denied benefits the first time and they would provide an attorney for future appeals.

I asked for a complete copy of the policy and read it cover to cover. I discovered that they could only suggest but not demand that I apply for SSI. I also learned that SSI would offset my LTD policy, but more importantly it would be taxed at my husband's income level which would further reduce my payments.

I decided that I was too ill to face appeal after appeal and the outcome would not be to my advantage. The policy clearly stated everything but the taxation issue. Subsequently, I believe at 7 years, I had to sign away any future SSI benefits for my disability.

The other catch is that SSI gives you a cost of living increase yearly. Disability payments do not. While it is distressing when you are first made aware of the information, it is most often in print. There is no way you will ever become financially solid on disability payments. Most of my monthly payment goes to doctor appointments and prescription drugs. Some months I don't break even.


From Michelle in San Francisco:

In response to Michael in San Francisco: It is unclear why these individuals can be described as "double dipping." For instance, the interview reports that Jay Thompson worked hard for 26 years for his pension benefit. It was a vested benefit that he earned. AT&T is claiming Mr. Thompson's hard-earned money so that it does not have to pay him disability benefits that it promised it would pay him if he became disabled.

There are many people who continue to work while drawing earned retirement benefits. I do not believe you would feel the same way if, for instance, AT&T tried to offset Mr. Thompson's savings, inheritance, or any other assets that were unquestionably his. There is no difference here - his retirement savings is a vested benefit that belongs to him alone. How can he be double dipping?

The real double dipper here is AT&T by giving promised benefits on the one hand and then taking them away with the other. Both the SSA and employer-sponsored disability policies serve as insurance for when one becomes disabled. We pay into both programs for the assurance that we will receive benefits if we become disabled - one through premiums, and the other through taxes. Why should the government have to subsidize private insurers when we have paid the premiums for this benefit through our taxes? There is a mistaken belief that if disabled people receive all of the benefits that they were promised they would somehow be ahead.

Keep in mind that living with a disability is not easy. It is life that is often fraught with increased costs. The interview says that Mr. Thompson, for example, needs 24-hour nursing care. His family simply cannot afford it. Just because something may be "industry standard" does not mean that it is fair.


From Dee:

Read the insurance policy (not the booklet or certificate, but the actual policy contract) carefully. Some insurance companies DO take offsets they are not entitled to. Does the insurance policy state that pension benefits are offset? Dollar for dollar? Be sure to read the insurance policy carefully and be sure that the insurance company is entitled to the exact offset they claim they are entitled to.


From Michael in San Francisco:

Anna, I'm sorry, but I don't see what all the fuss is about here. In both part one and part two of your investigation both individuals are "double dipping" and it only makes sense for these corporations to "offset" their disability payments.

In the first story, if the gentleman with ALS went out on disability from AT&T why would he also start collecting his pension? The second part of your story is essentially the same thing. If Melinda went out on disability from her company then why would she even apply for social security disability? I'm surprised SSA approved her claim when she's already receiving a disability check from her company.

In both cases it's like receiving two pay checks. What am I missing here? I am not an Insurance company advocate, but I'm with the Employer in both cases. It's only fair and it's industry standard.


From Cassie Springer-Sullivan, attorney featured in our story:

I am Jay and Theresa Thompsons's attorney, and I have been involved in this developing story for quite some time. In response to Tom's comments (see below), I notified AT&T before the interview took place, and before it aired about this story, yet AT&T declined to give an on-camera interview.

I am glad that you will remind your claims handlers to remember that there are human beings on the other side of the phone, but the real question is why is this reminder even necessary. I am also glad that you have encountered individuals who are pleased with your service; unfortunately, I have had the opposite experience, and have literally had hundreds of people approach me for representation who have not been able to receive their disability benefits despite their doctors' recommendations that they stop working.

I agree that disability insurance is an important safety net for people who would never expect to become disabled. However, when the net has a big hole in it because the disability benefit is reduced to $0 per month after offsets, it's not much of a net at all. The Thompsons are falling through that hole right now, and I sincerely hope that AT&T will do the right thing and restore Jay's benefits, or else I am confident that a court will order that they do.


From Tom:

This is, without question, a sad situation. The story as originally written I think unfairly relegated AT&T's side of the story to a separate statement while including an unrelated civil activist's statements in the body of the story.

Theresa's later comments helped solidify the core issue here which appears to be that they were given bad information and relied on that, then acted on it and are now paying the price. Assuming that is accurate, they will have a strong case to have this overturned, but it is a shame they had to go through this.

I will share the entirety of this story (including all the comments that followed) with our claims staff to remind them of the real people on the other side of the phone. We strive to get to the right decision every time, at the earliest possible time. The vast majority of claims are approved and on a timely basis, but you rarely hear about that.

Understandably, we do hear about the ones where something goes wrong. I have met countless individuals personally in their home who have told me first hand how disability insurance benefits have preserved their ability to provide for their family, so this example should serve as a lesson to us, but not dissuade people from protecting themselves against the devastating financial impact a disability can have.


From Mike in South San Francisco:

I am 60 yrs. old and I was employed by the same employer for 33 years. I became disabled and could not perform my job as a manufacturing supervisor. I was on disability for 6 months when I applied for long term disability with the insurance company.

I was denied benefits based on the claim that I could still perform my job. I discussed the claim denial with the claims representative. I was told that despite the fact that my employer and physician had informed the insurance company that I could not perform the essential functions of my job the insurance company felt I was not entitled benefits.

Finally after I spent thousands of dollars on an attorney and a Qualified Medical Examiner, the insurance company agreed to provide benefits. However, I will be re-evaluated at age 62. Another point made by the insurance company is that I must actively participate in their vocational rehabilitation program.

I was never provided with information regarding that obligation prior to my having obtained benefits and I have no problem with doing so. Interesting fact is that I have made over 23 phone calls to the insurance company over the last 12 months and have actually spoke with my vocational rehab person twice. However the insurance company has been good enough to call and remind me via their claims management person that I am obligated to participate in their rehab program.


From Bill in Walnut Creek:

The insurance companies' (attorney) spun the facts on this evening's newscast. As a former long term disability insurance investigator I can say from experience that the insurers are merciless and go to GREAT lengths to deny benefits including video surveillance of people through windows in their homes, cars, doctor's offices, etc. For every satisfied person that receives benefits there are at least 100 that are not.


From Laura in Mountain View:

I am totally disabled, and am fighting my long term disability insurance company to reinstate my benefits. The company paid (grudgingly) for 10 years, then all of a sudden decided that I should have recovered from non-recoverable illnesses. (More likely, the company decided it could save tons of money by dumping me.)

So to get my benefits back, I've had to hire a lawyer, pay for extremely expensive independent tests, and do a lot of stressful paperwork -- all while I'm seriously ill and have very little income. (Thank heavens for family!)
 
OH! And I'm still paying hefty medical insurance premiums to cover what medicare won't, because of pre-existing conditions. Corporate America is GREED run amok. We are in desperate need of a new system.


From Alan:

This is so typical of corporate America who treats employees well as long as it is in their best interest. The unfortunate situation at most large corporations is that there is no consequences for Human Resource employees who give false information. These so called "experts" likely don't understand half of the policies that govern employees insurance situations.

And to top it off, I guarantee that if you ask 3 different HR employees a policy oriented question that you will receive different answers. Whenever you have a conversation with an Insurance company or Human resources employees document it. Send them and email and hound them until they respond to your email that you have accurately understood the information that they conveyed. This will at least give you some ground to stand on when you discover the information you received was false.

AT&T should be ashamed of themselves for letting something like this go on for so long. There is absolutely no compassion on there part regardless of who it effects.


From Theresa Thompson, featured in our story:

Jay and I are overwhelmed by the support we are receiving. Thank you so much.

I do want to note, in response to the comment about doing the research into the policy. Jay actually did call the AT&T benefits center, prior to taking his pension. Contrary to what they told KPIX, they told us (I was on speaker phone speaking for Jay because his voice was not understandable at the time), that if Jay rolled over his pension, it would have NO impact on his LTD payments.

So Jay asked her to repeat that statement, had me write it down, and even kept the notation in his computer notes. They are not being honest when they say they told us our benefits would be significantly reduced. At the time, we had no copy of the policy, and only received it AFTER we acted on the information given to us over the phone by the AT&T Disability representative.

Anyone that knows my husband, knows that he is extremely thorough when it comes to financial matters. He would not have acted on withdrawing the pension had he been given accurate information in the first place.


From David:

The rationalization by the unnamed insurance hack is simply a lie. Most disability policies only pay a fraction of a person's pre-disability salary, so no one is getting rich--or more than they were previously earning--without the offsets. This unchecked greed by insurers must be stopped.


From Barbara:

Worked for AT&T 36 years...was on FLMA and then went out on disability...finally had surgery - removed part of colon, part of ovary, and fixed a hernia all the while in stage 4 renal failure.

AT&T denied the disability, District Mgr. threatened me with firing or take a buy out...Disability Grp. says I didn't prove I couldn't do my job even tho I was throwing up at work and not making it to the bathroom I was in so much pain.

Disability Grp didn't return phones calls, never returned my Doctor's calls, lied about reviewing my paperwork, misled what I could send them from Kaiser, tried to blame Kaiser, etc....I lost a job, and about $8000 in pay, lost my house.

AT&T has done this to others in my dept...example women with a brain tumor...anyone with a lot of seniority and mostly now mgt....Two mgrs had almost the same issues and they got paid, one even had same surgeon!!!!!!!!!We need to band together as a Grp...we need help....


From G. in San Carlos:

Insurance companies have no conscience and no morality. There is also no appeal (except through the courts) for their behavior. The state insurance commissioner needs to set up a panel to review cases of this type, staffed by independent people (doctors, judges?) to adjudicate these types of abuses . . .


From M. in San Jose:

AT&T needs to stop harassing these people and not take away their means of support. There has to be a big-wig in the company that has a heart and the pull that can fix this. Twenty six years of service is a lot of time - and these people were advised by the professionals at AT&T who handle these matters - and AT&T gave them detrimental advise. At this point- it should not be about the $$$$$$$$


From Scherazade in Sunnyvale:

While I do feel compassion and sadness for the family, I do feel it is the responsibility of the consumer to make informed decisions regarding their finances.

It is not up to the insurance companies to walk you through it as an informed consumer does not benefit them. If you don't have the document, get it. If you do, read it carefully ask questions. Don't take the first answer... ask again, verify information directly with the provider and not your hr. Document all correspondence which clarifies the terms of the policy. Do it before you need it.

I realize that terms of contracts need to be simplified for the consumer however, until then, it is ultimately our own responsibility to understand them or be advised by someone who does.

It does make me mad that we are saving everyone from their own bad decisions. This does not seem like a case of fraud, just unfortunately, not enough due diligence... I am a Kindergarten teacher. Anyone want to talk about the so called "windfall prevention act" which deducts social security money because teachers apparently make too much at retirement. Let's fight that one of we are all riled up about this.

And later:

Given what I have said in my earlier post, I do feel that a company also needs to do their due diligence before issuing a benefit. Unless there was fraud or misrepresentation of the family's finances to the insurance company, the company should not be entitled to a refund of the money already paid. They also need to do their homework prior to cutting the check.


From Geneva J.:

We are absolutely appalled at how the system has failed this family. Who gets "rich" on disability insurance? That is such a joke statement. Our sympathy goes out to that poor family, both for the patient and his family who are all suffering because insurance companies in this country are so greedy!


From S.O. in Santa Clara:

I used to disgust (sic) those whose cheat to get the benefit from the insurance until I hurt my back. Luckily it was a short term one. Many private insurance & private company are sleeping in the same bed. One wants all the premium for the perks and bonus. The other does not want to see the rate increase, which it does anyway, they make their policy as clear as a glass of milk so they can screw people as much as they could to reduce the payout.

To avoid the pitfall like the Thompson family, my sympathy to them, is to get everything in writing, policy, record all communications... so that we can have a clear cut of rules and regulation. It is not easy, but we must learn to play their game.


From Judy in Mill Valley:

No one expects to read their disability policy -- they just want to know it's in place if they need it. Will I receive 50% or 66 2/3% of my salary should I need it?

When you need the benefit, it's too late to understand what is "best" for withdrawing funds -- the confusion experienced when first diagnosed/hospitalized is overwhelming, let alone doing any financial planning.

I was upset to learn that I couldn't receive 100% of my salary by having Social Security supplement my 66 2/3% LTD. My expenses went up and not down due to the personal caregiving that I required and the other expenses (co-pays, home modifications, specialized auto, etc.).

I've exhausted my "emergency fund" and am hoping that I won't have to tap into my pension fund from a past employer and receive its reduced benefit for disability, let alone other retirement monies especially if my life expectancy isn't reduced as a result of my health.

I realize I'm more fortunate than those without any long term disability or savings, but I had hoped to retain my quality of life as much as possible.

I'm very sorry that Jay Thompson and his wife are receiving the type of treatment they've received. This is a very sad commentary on the complexity of healthcare, insurance, and financial planning.


From Carla:

I have heard of so many disappointing situations surrounding Disability Insurance. It is never in the favor of the employee. My heart goes out to Jay and Theresa.

The whole Disability Insurance Program needs a thorough review. It does not help the injured workers at all. How can one become rich off of such small payments? The focus needs to be on the insurance companies and the money they are making by ripping off employee's. I am sure the outcome would be astonishing. I really do not know how these people with no conscious sleep at night.


From Michael in Walnut Creek:

Insurance companies are in the business to collect premiums and NOT pay anything out, or pay as little as possible. Executives probably get bonuses for coming up with ways NOT to pay. Makes sense, that way the company makes more so it can pay executives more.

Basically no one can count on what they think they have, You only get what they decide to let you have after they have taken their share of what they want from your premiums.

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