Long Term Disability Insurance
Part 2: Always appeal refusal of CPP disability benefitsAugust 24, 2017
For the second part of our series about CPP disability benefits, I interviewed David Brannen, a former occupational therapist turned disability claim lawyer from Moncton, New Brunswick. Brannen is the author of A Beginner’s Guide to Disability Insurance Claims in Canada. He started the national disability claim law firm Resolute Legal to help deserving people win long-term disability payments from insurance companies and the CPP Disability Program, even after a denial or unsuccessful appeal. Thanks for joining me today David.
I’m delighted to be here, Sheryl
Q: How does the definition of eligibility for CPP disability benefits differ from the definition in an individual or a group disability insurance plan?
A: The easiest way to look at it is that the CPP definition is much harder to meet than most disability insurance policies. CPP disability is focused on the inability to do basically any job in the economy, whereas disability insurance policies look at the ability to do your own job. Then there usually is a second part in an insurance policy that will continue to pay benefits if you’re disabled from doing any job as defined by the insurance policy but that is usually a much less restrictive definition of any job as would be defined for CPP.
Q: So how hard is it to meet the eligibility criteria and get CPP disability benefits? Of the people who apply, how many are successful at the first level?
A: The last data that we had released was an auditor-general’s report back in 2016. The results were pretty shocking and showed that of the 70,000 people who applied in the audit year, about 60% were denied.
Q: Why is the denial rate so high?
A: It’s hard to say. I would assume a number of those people of the 60% simply don’t meet the eligibility from a contribution standpoint so many people have either not made recent contributions or they’ve never paid into CPP at all. But the bulk of people who have met the contribution requirements get denied because they simply don’t have enough information for the case to be approved.
Q: Why should a person receiving LTD benefits — that’s long-term disability benefits — from a private or a group plan apply for CPP disability benefits although if they are successful the LTD benefits will typically be reduced?
A: That is a very good question. The first reason I tell people is look, you really don’t have a choice because after a certain point the insurance company will estimate and start deducting your CPP disability amount even if you’re not receiving it.
The other big one is that receiving a CPP disability benefit will actually result in you eventually getting a higher CPP retirement. The general idea is that it shows that you’ve been out of the workforce for a legitimate reason and it actually does factor into the ultimate CPP retirement pension at the end. Finally, getting the CPP disability benefit is really a safety net. If you suddenly lost your disability benefits you would have still the income coming in from the CPP disability program.
Q: That’s interesting. Now, tell me about the appeal process available to people who are turned down.
A: Okay. It’s a two-step paper appeal process. So once you apply and get a denial, you have 90 days to submit a written appeal requesting a re-consideration. You will send it directly to Service Canada, the same people who declined the original application. The best scenario is that you will supply more information to support your arguments.
If your internal reconsideration is denied, the next level of appeal is to the Social Security Tribunal which is an independent body that is the final decision-maker as to whether or not you are entitlted to a CPP disability benefit.
Q: You just told me in an offline discussion that typically those hearings are held by video conference or telephone.
A: You have the option to do them in person and certainly sometimes the tribunal judges will request an in-person hearing but more and more they are scheduled by video conference and telephone. It enables the Tribunal to actually process the claims more quickly and at less expense to the claimant.
Q: So of the 60% of applicants who are turned down initially, what percentage go on from there to submit a reconsideration appeal and then an appeal to the Social Security Tribunal if they are turned down a second time?
A: One of the big things that really shocked me when I saw the auditor general’s report is that of the 40,000 people denied, about 66% just give up altogether. That means only 33% or about 13,000 people actually file appeal. Then of these 13,000 people, about 35% get approved and about 65% are denied. That leaves you with a pool of like about 8,500 people who get denied after the second appeal.
So you’re already down from 70,000 to 8,500 who are denied at that second level. Again, of those people who get denied on the first appeal, more than half give up. As a result, the number of people that go on to the tribunal hearing is about just over 3,000 people as documented in the most recent report.
Q: How do they do?
A: Actually they do fairly well. Of the 3,000 that go to the final hearing, about just over 60% actually get approved. That shows if you’re one of those people that does persevere to the end, you do have a better than 50% change of winning at the tribunal hearing, all things being equal. It’s the one point where the percentage of approvals kind of flips if you look at it. By the time you make it to the tribunal here is about a 60% approval rate.
Q: So you’ve published a number of online publications to help people and one of them is The CPP Disability Claims Approval Blueprint. What are some of the tips for success on appeal that you offer in blueprint?
A: Number one is meet the claim deadlines. Many people lose and are denied because they just don’t meet the deadlines for appeals. It’s a very unforgiving system. The other thing we tell people is that most claims are denied because there’s just a lack of information. Therefore, we encourage people to just get as much information into the claim file as possible. That means getting your complete doctor’s records going back as far as possible. Any physiotherapy records or medical records you send in are helpful. Most people just send in their most recent family doctor’s records but I can’t emphasize how important it is to have historical records on file.
Finally, the real secret to winning these cases is building a persuasive narrative and story of your case. To build that narrative you need the historical medical records. One of the most powerful stories you can tell is a struggle over time — that you just didn’t decide to stop working one day. You can show you struggled for years at work. You struggled with disability and pain for years and it’s all recorded in the medical records. Once you can show that powerful story all of a sudden the hearing can flip from, “Why aren’t you still trying to work?” to, “Wow, look at what this person’s been through over the last five years.”
Q: How can a disability lawyer help people who are turned down the first time around?
A: Frequently disability lawyers can help not by necessarily jumping in to represent people but by giving them better information to do a better job representing themselves. The main value a lawyer brings in a case like this is the ability to pinpoint where the information gaps are. The fact that you’re disabled does not win your case. What wins the case is showing that the medical records or the materials you put in demonstrate you’re disabled.
I guess lawyers help most by being able to pinpoint the specific information that’s needed and sometimes they are better able to get the information. Doctors are often not as receptive to having the patient tell them, “Can you please expand on this? We need to know more about that.” But if a lawyer writes to them, they’re more likely to respond to those types of inquiries.
Q: How much does it typically cost for legal services to appeal a CPP disability claim? After all, disabled people appealing CPP benefit typically haven’t worked for a long time and may be really broke. How much are they putting out and how long is it going to take them to pay this off before they even have a pension in their pocket?
A: I can’t speak for all lawyers or people who practice in this area. We take cases on a no win, no fee basis so that there’s no money is required upfront. You would just pay if an appeal is successful. Anticipating this call, I calculated that our average fee for the last year was about $4,500. That’s based on all cases, including ones where we get a zero because the case is lost.
Typically if we are successful, there is a back payment and the fee would be paid as a percentage of that back-payment (say about $15,000). Like I said, our average for 2016 was around $4,500 of that back-payment. We’d get our fee and our client would keep the remainder and all future payments.
Q: Okay, that’s great. So is there any other comments or questions that I didn’t ask that you’d like to comment on?
A: Many people, legitimate people I see are denied are for two main reasons. One, they haven’t tried to go do other types of work or they haven’t demonstrated that they really tried to stay in the workforce. The other one is, for whatever reason not really following through all of the medical recommendations. So if you quit going to physio, if you refused to take a drug, those are kind of things that can also cause a legitimate claim to be denied
That’s great! Thank you very much, David. It was a pleasure to chat with you today.
It was my pleasure. Thank you.
|Written by Sheryl Smolkin|
|Sheryl Smolkin LLB., LLM is a retired pension lawyer and President of Sheryl Smolkin & Associates Ltd. For over a decade, she has enjoyed a successful encore career as a freelance writer specializing in retirement, employee benefits and workplace issues. Sheryl and her husband Joel are empty-nesters, residing in Toronto with their cockapoo Rufus.|