ERISA: The coming storm in Texas (and why it’s a good thing)

Many think the Employee Retirement Income Security Act (ERISA), enacted in 1974, is a boring, inconsequential statute, but they couldn’t be more off base. A new Texas case foreshadows the immediate future. Here’s a glimpse of what’s coming.

Long-term disability benefits denied—So what?

Jason Grice, who works for Google, has a nerve disorder that caused his right foot and ankle to become deformed. He underwent surgery to correct the issue. 

Despite conflicting medical opinions, he was denied long-term disability benefits by the plan administrator because he couldn’t meet the plan’s definition of long-term disability. A federal trial court affirmed that decision.

The U.S. 5th Circuit Court of Appeals (whose rulings apply to all Texas employers) foreshadowed a very important question: Must a federal court defer to a plan administrator’s denial, or can it ignore a plan administrator’s denial, looking afresh at whether the employee should receive the benefit (called de novo review)? The first prong means almost 100% of the time, no benefits. The second means that 100% of the time, employees are given a fighting chance to receive the benefits.

Where does Texas fit?