Q and A, Helping Clients on Disability Leave: Guidance for Healthcare Professionals Webinar

Employers are not legally obligated to offer either short term or long term disability benefits coverage to their employees. There are, in fact, many employers that do not offer disability coverage to their employees. It is also possible for an employer to offer coverage only to full time employees and not to part time employees or to specific divisions.
  1. The Plan Sponsor Statements/Employer’s Statements may differ from one insurer to another. I have attached a blank Plan Sponsor Statement from Manulife Financial to provide you with an idea of the type of information the insurer is typically seeking on these forms. This particular form can be accessed online.

  2. In a perfect world, the employer should have no influence on the outcome of the long term disability claim. The claim is supposed to be decided by the case manager employed by the insurer on the basis of an analysis of the medical evidence, occupational duties and the applicable test for disability under the Policy.

    The employer’s involvement should be limited to providing the potential claimant with the ability to access claim forms and facilitating the application process in that regard.

    The employer could be interviewed by the insurer and asked to provide information as to the nature of the claimant’s position and work duties and whether there were issues in the workplace.

    The employer may also become involved where benefits have been approved and the claimant is looking to be accommodated in a return to work program or the insurer has initiated a rehabilitation program.

    In practice, I have seen employers involve themselves in long term disability claims by trying to provide the insurer with negative information on a prospective claimant and suggesting that claims should not be approved. As lawyers, we are always on the lookout for the appearance of collusion between an employer and the insurer as a fertile area for critique of the adjudication process. Insurers have an obligation to adjudicate claims in good faith and should not be unduly influenced by external factors.
The LTD application form usually contains a Declaration and Authorization section. Sometimes the section will state that the insured authorizes the insurer to “investigate their claim” and authorizes the insurer to collect, use and disclose information needed for underwriting, administration and adjudication of claims under the Plan/Policy. I have had insurers argue that “investigate” includes the right of the insurer to conduct surveillance. That has not been tested in any long term disability case law in Ontario, as far as I am aware, however, surveillance is a common practice in the context of disability claims and a specific authorization or consent from the insured is not required.
Typically, insurers will avail themselves of any opportunity to rely on the strict wording in insurance policies. I have, however, seen a little more flexibility in recent times on this issue. The key is to ensure that the insurer is aware that the alternative treatment option is having the desired effect and is comparable in terms of desired outcome to what may be achieved in an inpatient setting. If there are demonstrable gains using an alternative approach to inpatient, particularly where other options are not available to the claimant due to extenuating circumstances, if the insurer were to terminate the claim on the basis of failure to pursue inpatient or residential programs, the reasonableness of the insurers conduct would be called into question. We have, for example, argued successfully on several occasions in the past that due to an individual’s anxiety or social phobia, for example, a residential program would have been inappropriate for them. We have argued that securing alternative treatment modalities served the same purpose and was as effective as inpatient based on the needs of that specific claimant. The key is frequency and quality of treatment. That being said, certain case managers may still terminate claims where the claimant is not attending an inpatient facility.
Although I have not had insurers say so expressly, my impression is that the harm reduction approach is not favoured by insurers. I believe that this has to do with a perception on their part that the process will not be as expeditious or as effective as inpatient programs or programs that advocate for abstinence at the outset. In advocating for a program of this nature, it would be useful to communicate with detailed medical substantiation why this would be a preferable approach for a specific client.
If the employer has a designated occupational health department or employee health team that is separate from the employee’s direct supervisor, manager and colleagues, information can be shared. In terms of privacy, the health teams are set up so that information is not shared with direct managers, supervisors or colleagues. It is important, however, to determine the purpose for which the information is being sought. If the employee is working towards a return to work, it may be appropriate to share certain information at that time especially if accommodations are being sought. If an employee remains on long term disability benefits and there is no indication that a return to work is appropriate, I would question the need to share information with the occupational health or employee health team.

If you have a client that is dealing with WCB and requires assistance, please contact me at [email protected] and I can make suggestions for referrals to appropriate individuals. There are many factors that need to be taken into consideration. WCB is also a very technical area and finding someone with expertise in the area is important.

It depends very much on the nature of the Retainer Agreement and the firm that the client is hiring to represent them. In our firm, if claims are not successful, we do not charge a legal fee. On the very odd occasion that a claim is not successful, our view is that the client is taking a risk just as much as we are and we should not benefit if the client has not secured a positive outcome.

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