Comment from Bryant, David, Attorney

The Proposed changes to break out any approval of attorney fees for third parties, legal guardians and court appointed representatives lack any foundation in facts requiring such changes. Basically, the Proposed Regulatory changes expand and replace SSR 85-3 to allow Long Term Disability Insurance companies (LTDs), Self Insureds for LTD(SIs) and agents of LTDs & SIs (such as Allsup) to get paid for helping claimants get Social Security disability benefits. I have three basic comments or critiques: First, there is no prohibition on payments to any of the three categories if they fail to get the benefits for the claimant. Thus, a guardian could charge for the time spent on an unsuccessful claim. It is not clear whether "front" money (retainer/advance on costs) to ALLSUp from UNUM would be allowed regardless of the outcome. The contingency nature of any payments outside the "approval" mechanism currently in place may be missing. Second, the prime assumption that SSA will still "protect claimants and beneficiaries" by allowing third party payments to representatives seems suspect given the multiple ERISA lawsuits against LTD carriers for bad faith and for lack of compliance with their own standards. It's all about the money. It is illusory protection when the LTD carrier reduces the $4,000.00 monthly disability check by the $1,600.00 and $800.00 monthly checks for the claimant and beneficiaries from SSA. It is illusory when the LTD carrier wants the back benefits check of two years (~$50K) returned as a payback for the prior LTD monthly payments during those years. As a side note, the LTD carriers may want to take advantage of insureds by requesting a letter of direction directing a direct deposit of back benefit to an LTD account as a precondition to continued LTD payments. Third, 404.1720(e) speaks of "a business entity independent of your representative". I am not clear what that means, especially the "independent" portion. Based on my 30 years of practice as an attorney in this arena, I run into these situations. UNUM (or other LTD) pays ALLSUP ( or other lay representative) to get an insured on to the SSA/DIB rolls and off the rolls of UNUM in order to save UNUM money. It seems that ALLSUP is an agent of UNUM and not an agent of the claimant. In the majority of disability claims, there may be no conflict of interests, but in many, such a conflict often arises after an Award of Benefits. What will the "representative" tell the claimant when asked "Do I have to pay UNUM back all the back benefits? My ex-wife is getting the SSA checks for the kids in her custody. Does she have to pay UNUM?" I am worried that an ongoing business relationship that benefits the business entity might cause a conflict of interest between the claimant and the representative. For example, most LTD carriers change the definition of disability after two years from "own occupation" to "any occupation". Assume the claimant tried to work at another easier job, a policy encourage by SSA (UWA, TWP). Disclosure of this information by the representative to the entity may be used by the LTD to deny continued LTD coverage. Since this is a definition problem, and since SSA has broad experience in the taxing area for "independent contractors" as compared to "employees", a clear and practical definition of "independent" may be required to "protect" claimants and their families. Housekeeping: 404.1703 Definitions "Legal Gruardian or court appointed representative" I suggest you preface the definition with: In the absence of a statutory definition in the State having jurisdiction, In Illinois, guardians can fit into several different categories and combinations: Plenary(full) or Limited; of the Estate/of the Person. Thus, a judge can appoint a public or private guardian of the person with the limited power to consent to surgery. of the estate of a 19 year old son with Asperger Syndrome; a plenary guardianship of the estate and person of the father with Alzheimer's Disease. In other words, guardianship can be tailor made to the needs. In Illinois, a court appointed representative can be the State, or County under commitment proceedings if a person is a danger to himself or others. David R. Bryant Attorney at Law