New Disability Claim Rules Postponed Until April 2018

On December 16, 2016, the Department of Labor issued final rules amending the claims procedures applicable to employee benefit plans that provide disability benefits and are subject to ERISA.  The final rules were to have been effective January 18, 2017 and apply to claims on or after January 1, 2018.  (See our January 2017 Comp and Benefits Brief for a summary of the changes made.)  Recently, the DOL delayed the date the rules are first applicable to claims from January 1, 2018 to April 1, 2018.

Under pressure from insurers and to satisfy the Executive Order 13777 that calls for reducing regulatory burdens by repeal or amendment, the DOL has provided a 90-day delay and has invited submission of data and information by December 11, 2017 that may show why the rules will result in unwarranted cost and reduction in disability coverage.  It is not clear whether insurers can submit information that persuades the DOL to delay, amend or terminate the new rules.