Effective January 18, 2017, the Department of Labor issued a
"final rule" modifying 29 CFR § 2560.503-1,
governing claims procedures for disability benefits under ERISA
plans. The new regulations apply to disability claims filed on or
after January 1, 2018.
Addressing conflicts of interest, the final rule requires
decisions regarding hiring, compensation, termination, or promotion
of persons involved in making claim decisions not be based on the
likelihood the individual will support denial of benefits.
"Persons involved" in making the decision include, but
are not limited to, "claims adjudicator[s]" and
"medical or vocational expert[s]." The rule is not
limited to persons "directly hire[d]" by the
administrator or to those who were "responsible for making the
decision," but also extends to employees of third party
service providers. Administrators must "take steps (e.g., in
the terms of its service contract and ongoing monitoring) to ensure
that the service
