In a unanimous opinion issued on Monday, December 16, the U.S. Supreme Court in Heimeshoff v. Hartford Life & Accident Insurance Co., sided with ERISA plans and their employer sponsors. The Court ruled that benefit plans subject to ERISA (i.e., most private healthcare and other benefit plans) can establish their own “reasonable” statute of limitations for participants to challenge benefit denials in court.
A statute of limitations is the amount of time allowed for claims to be made under a law or contract. Often times, state or federal laws say what the statute of limitations is for a legal claim. Other times, parties may agree about the statute of limitations. In this case, the applicable amount of time was set forth in the plan’s terms. The Court found that this practice is acceptable, so long as the amount of time is reasonable.
This decision reiterates the importance of being aware of the amount of time available to file a claim in all cases, not just ones involving ERISA. When something happens in the workplace, the first thing on a person’s mind may not be contacting a lawyer. However, it is always wise to reach out to a knowledgeable employment or benefits lawyer sooner rather than later to ensure you are not missing your opportunity to enforce your rights. One of the first things a lawyer will do for you is research the time you have to act.
This decision also reiterates the importance of reading and being aware of the contents of the summary plan description (SPD) for your benefit plan if you disagree with a claim determination. If you do not understand something, consider contacting a lawyer to walk through it with you.