Prepare for a “tsunami” of long-Covid disability claims

A projected 20% of long-haulers will be too sick to return to work. With some insurance providers already denying the workers’ LTD claims, HR departments must consider other ways to protect their workers.
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· 5 min read

More than 40 million Americans have been diagnosed with Covid-19, and research suggests that between a quarter to a third of them will develop long-haul Covid, a mysterious illness characterized by persistent symptoms that include severe fatigue, cognitive impairment, and respiratory problems that may leave more than 20% of patients unable to return to work.

Faced with these numbers, infectious-disease expert Dr. Claire Pomeroy predicts an impending “tsunami” of disability claims stemming from long Covid.

If long-Covid patients, called long-haulers, file as expected, it could amount to an historic influx into the US’s disability system. But claims require approval, and some insurance providers are already denying long-Covid claims, leaving it up to HR departments to consider other ways to protect their workers.

New disease vs. old insurance companies

Disability law firm Kantor & Kantor received so many inquiries about Covid insurance claims that it created a free guidebook addressing long-Covid claim denials.

If the firm’s experience is any indication, the tsunami of long-Covid claims is here, and it’s slamming into a seawall of rejections from insurance providers.

Attorney Andrew Kantor says the rejections are strategic and expected: “Insurers are incentivized to deny righteous claims because there is very little risk to doing so.”

Kantor believes providers opt to deny claims knowing that under the Employee Retirement Income Security Act (ERISA)—the federal law governing employer-sponsored disability benefits—people have to jump through a lengthy and expensive series of hoops to appeal the decision.

Denied applicants who escalate their claims must first exhaust the insurance company’s internal appeal process (which can take years) before filing in court. If a legal claim succeeds, the company will shrug and pay only the original amount of the insurance claim—no more, and no damages.

Covid-19 is a particularly difficult claim to make, because approval requires a clear diagnosis and an equally clear list of limitations and restrictions caused by the condition. Long Covid is a new disease characterized by chaos, not clarity.

HR Brew reached out to the major players in long-term disability insurance—Unum, Blue Cross-Blue Shield, Medical Mutual, Prudential, and Guardian Life—seeking data on the number of claims filed and the number approved. None would provide it.

Unum spokesperson Natalie Goodwin said Covid-19 is “primarily a short-term event” with claimants recovering before long-term disability begins at 90 days (research is not definitive, but one prospective study estimates long Covid to last a median of six months); Guardian and Prudential reps said long Covid is covered under their policies, provided the individual’s medical information sufficiently matched the definition of disability; Blue Cross-Blue Shield and Medical Mutual declined to comment.

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Working outside (the system)

Kantor contends that HR leaders who choose disability-insurance packages remain largely oblivious to the problem because they usually aren’t around to witness the outcome when long-Covid claims are denied.

“By the time employees’ claims are finally denied and appeals are exhausted, they are months or even years removed from the workforce,” Kantor explained. “There is no engagement survey where a disabled employee can report back to their old company and say, ‘This [system] didn’t work for me, we need to change it.’”

To address the long-Covid insurance issue, an estimated one-third of US companies have created new and separate Covid-19 leave policies, according to a study by Guardian Life. Other companies are working entirely outside their benefit packages to assist.

One such company is Gotham Technologies Group, a small technology consulting firm based out of New Jersey. CTO and co-owner Kenneth Phelan first heard about long Covid from a direct report whose brother suffered from it.

After learning that the man’s disability claim was being held up by the insurance provider, Phelan decided to make sure his company was prepared to help employees with an affliction that is more common than he had realized. Phelan said he pressed leadership to assess individuals’ disability needs on a person-by-person basis—he acknowledged there is more legal risk to making benefit decisions at the individual level, but ultimately decided it was worth it.

“Working with the insurance companies gets frustrating—they’re asking for diagnostic codes [to approve funding] and are overly concerned with precedence. They can’t get anything approved,” he explained. “So we’re working outside those systems. Instead of asking the [insurance] companies what’s approved, we are asking our people, ‘What do you need?’”

As human resources departments grapple with how to support their long-Covid employees and caregivers, there are no easy answers. Phelan said the most important thing HR teams can do to support long-haulers is listen to their experience, find out their pain points, and learn.—SV

Do you work in HR or have information about your HR department we should know? Contact Susanna Vogel via the encrypted messaging apps Signal and Telegram (@SusannaVogel) or simply email [email protected]

HR is challenging. HR news doesn’t have to be.

HR Brew keeps you effective in the fast-changing business environment.