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You have probably seen surveillance footage of a fraudulent disability insurance claimant who claims to have a bad back, but is caught on camera lifting a heavy carton. What the cameras do not show is the legitimate disability claimant who is denied benefits by their insurance company.

Unless you know someone personally who has been denied disability benefits from an insurance company, you might harbor a suspicion that claim denial is generally because the insurance company suspects fraud. After all, you never hear about the insurance company committing fraud on its own clients. However, voluminous court cases will attest that insurance companies are notorious for denying disability insurance. This is especially true when the claimant makes over $50,000 a year.

The reason you seldom, if ever, hear about insurance companies committing this type of fraud is commonly for one of 3 reasons.

  1. The claimant is broke and trying to keep food in their belly and a roof over their head. Dealing with both the financial cost and physical pain of their disability leaves little time, or energy, to fight the insurance companies.
  2. Less than 6% of the people who have been denied their disability benefits will sue the insurance company. This might be due to the fact that the insurance companies have successfully lobbied many states to change their laws to favor the insurance companies.
  3. Insurance companies have been known to offer a claimant a partial settlement, along with a warning, that if the claimant does sue (and is successful) it will be years before they see any money. For example, if they have a policy worth a half-million they might be offered $50,000 to settle now or wait for whatever money the suit will bring. The insurance companies have lobbied for laws that restrict any awards to the face value of the policy. All settlement payments are given with the stipulation that a non-disclosure form be signed. That is why you never hear about this type of settlement.

A new wrinkle has surfaced in how insurance companies are taking the spotlight off of themselves for denial and have shifted it to a new group called Certified Rehabilitation Counselors (CRC).  The Commission on Rehabilitation Counselor Certification (CRCC) certifies and sets standards for rehabilitation counseling in the United States and Canada. It is an non-profit organization with over 35,000 members.

When you file a disability claim one of the first things that will be requested by the insurance company is a list of skills required to do your job. What is not explained to you is that if you can do any one of those skills, that you have listed, you can be denied disability benefits.

The analysis of what marketable skills you have is often performed by a CRC member. It is their job to report to the insurance company if you can be employed with the skill set that remains available to you. It appears that the insurance companies are applying pressure to CRC members to help them in their denial of disability claims. At least that is indicated in a recent survey of 7,660 members.

The CRCC survey queried members about their perceptions of ethical dilemmas and implications for code of ethics revisions. At the top of the list, members were most concerned about being pressured by their employer, followed by confidentiality and exceptions to confidentiality. When members were asked about what concerns they foresee in the future they responded that their concerns for the future are the same as they are today–employer pressures and issues regarding confidentiality.

Some interpret the CRCC survey as further proof that the insurance companies are creating a firewall to burn their claimants. The insurance companies have taken the spotlight off themselves and shifted the attention to the certified rehabilitation counselors. Nolo Press list eight reasons you may denied benefits.

{ 3 comments… add one }
  • cdiu victim November 23, 2008, 1:03 pm

    Cooperative Disability Investigation Unit might be watching you

    The Social Security Administration (SSA) and the Office of the Inspector General (OIG), and Disability Determination Services (DDS), administer the Cooperative Disability Investigation (CDI) project. Since its inception in 1998, CDI efforts have resulted in over $221 million in projected loss of benefits to disabled people and over $117 million in projected savings to non-SSA programs throughout the country.

    The program consists of 18 CDI Units (CDIU) nationwide, whose mission is to obtain evidence of material fact sufficient to cut off the payments of disabled people. This supports the Agency’s strategic goal of ensuring the integrity of Social Security programs, with zero compassion for disabled
    people.

    Since 1998, CDI Units have been established in Atlanta, GA; Baton Rouge, LA; Boston, MA; Chicago, IL; Cleveland, OH; Dallas, TX; Houston, TX; Iselin, NJ; Nashville, TN; New York, NY; Oakland, CA; Phoenix, AZ; Richmond, VA; Salem, OR; Seattle, WA; St. Louis, MO; Tampa, FL; Denver, CO; to combat Social Security disability recipients.

    Seattle is one of the newer CDI Units established in the program. Authorized in March of 2002, the Unit began operations in December 2002, with employees from the Washington DDS and the Washington State Patrol staffing the unit.

    During the first full calendar year of operations (2003), the Seattle Unit has proven itself as one of the most successful units in the nation. (they cut off, killed and made homeless more disabled people than any other unit in the country) The Seattle unit finished 2003 ranked as the fifth best Unit among the 18 existing Units nationwide. The Unit finished first in the nation for the month of January 2004.

    PURPOSE

    Facilitating inaccurate decisions made by the DDS, by gathering evidence to refute claims, and prosecuting individuals and/or groups who knowingly facilitate and/or promote fraudulent disability
    claims and harassing innocent people.

    UNREPORTED WORK ACTIVITY

    Anonymous Tips > Obtain specifics; place of work or information on others who may know about the work, ex spouses make the best witnesses Repeat Offenders > Patterns of seasonal work or several months of work with no recent medical review.

    Claimant’s Appearance > Things being out of place with one’s personal appearance and/or one’s personal property Bumper stickers,(logos on vehicles), make up, smiles.

    FOCUS

    The MAJORITY of referrals to the CDIU are from DDS employees <———-spotting irregularities (such as someone not seeing a doctor after moving to an area where no doctors will take medicare) while processing claims and Continuing Disability Reviews (CDRs). However, the CDIU will accept referrals from anyone who has something against their neighbor and/or source of information.

    In a partnership with SSA, Washington State Patrol detectives conduct the investigative portion of the case. They do home visits pretending to be investigating mail fraud and attempt to talk to the claimant. They also follow claimants in their cars and talk to their neighbors, bosses and college
    professors. Often the CDIU investigators will video tape disabled people as they go to their SSA medical examination and then follow them home. DDS analysts develop documentation to refute the legitimacy of the claim. The OIG for the SSA supervises the activities of the CDIU and ensures appropriate action is taken on each hatchet job in question.

    If sufficient information and evidence (such as audio and video tape) is bodged together, the hatchet job is presented to either a US Attorney or a local District Attorney for prosecution. If a referral does not warrant a criminal charge,civil or administrative remedies may be pursued.

    In the vast majority of cases when no evidence is found they may find that you are still impaired and then cut you off anyway but they will not attempt to charge you. People with mental disorders are especially vulnerable and favored targets for this.

  • Mary G. January 18, 2010, 12:48 pm

    I think I was just investigated by this unit, waiting to hear if they will cut me off, all because my landlord would not except the guide dog I had, so he had me evicted, or harassed me so much that I just left before he had me evicted. Now, a few months later, I just realized why they were not moving forward with the claim to HUD. I guess all I can do is wait and see if they cut me off and if I have any legal recourse.

  • lorna March 12, 2010, 7:39 pm

    How can you expect to work, if you take painkillers and the job requires drug testing? How much is the life time benefit of your worker compensaion policy? You should know before injury like you know for auto and life. If you must kill yourself to end the pain, then take some of them with you, it will do more for fraud than a law suit.

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