Although there are two basic ERISA Plan definitions of disability, claims handlers ignore the major differences in Plan language between “unable to perform material and substantial duties”, and “limited from performing material and substantial duties.” Of course, it’s to the insurers’ advantage to blip over lesser burdens of proof of disability. Claims handlers are not trained to distinguish between the two definitions.
Although I’ve been described as a “structuralist” when it comes to disability Plans and contracts, the accurate explanation is that there is a real interpretative difference in the two definitions.
“Unable to perform material and substantial duties” means what it says. The claimant must be unable to perform ALL of the material duties of the occupation in order to be totally disabled. Instructional materials published by national insurance organizations, such as the Health Insurance Association (HIA), define “material duty” as a job task required to be performed at least 20% of a full 8-hour workday. “Substantial”means the relevance of the task in defining the occupation to the point that if it did not exist, the occupation cannot be defined. Oops, sorry about the word salad.
Can an occupation be called “Secretary”, if it doesn’t involve typing and filing? In any event, when a Plan writes the definition of disability as “unable to perform the material and substantial duties” it means all of them for total disability. In contrast, “residual” definitions in the same Plan can write, “unable to perform some, but not all duties of the occupation, because it is presumed an insured or claimant can work part-time, if they can do some, but not all of the material and substantial duties.
On the other hand, when a Plan writes, “limited from performing material and substantial” duties, it means that all the claimant needs to prove is that he/she is LIMITED in the performance of their duties in order to be totally disabled. This is a much lesser burden of proof, although most wouldn’t know it because it is ignored by insurers and their claims handlers. I always inform my clients of the distinction and recommend the point of difference should be made in the administrative record.
Every claim situation is, of course, different and I’m not trying to make a legal argument here, so attorneys, relax. I know you defend different interpretations; and discretionary authority aside, my point is that there IS a difference in the Plan language used, and the Plan should be managed by what the Plan says. I always take the view that the writing of the Plan means what it says.
Since the definition of disability is the determining factor to pay or not pay claims, the difference in wording is important, and can be defended, if the claim situation warrants the distinction.
I suggest that claimants look at the definition of disability in their own Plans to determine whether is says, “unable to” or “limited from” performing material and substantial duties, and defend total disability accordingly. Remember that each claim is different, with unique circumstances and cannot be compared to any other claim.
Still, the differences in definitions remain important and all claimants should at least be made aware.
