Requests for paid time off for mental-health conditions are denied at a higher rate than straight medical claims, data show
When Justin Gimotea’s anxiety and depression flared in 2023, he did what an increasing number of American workers do: He took a leave of absence.
He filed a claim for temporary disability benefits to cover part of his salary while he was on leave. Following months of submitting forms and attestations from his doctors, Gimotea’s claim was rejected by his employer’s insurance administrator. Several appeals were also denied.
More workers are seeking paid time off to treat mental-health conditions such as anxiety, depression or post-traumatic stress disorder, and they are facing more resistance than do employees with straight medical claims, according to lawyers, industry experts and data from insurance-claim administrators.
Companies say they take workers’ mental health seriously and that they want valid claims paid out. They also say there are legitimate reasons for questioning a medical provider’s conclusions about an employee’s ability to perform a job, because it can be more difficult to assess the effects of a mental condition than it is for a medical ailment such as a broken hip.
Some workers and advocates say insurance administrators too often deny legitimate claims. They say the challenge of assessing the severity of symptoms makes it more important to defer to medical providers who treat patients and understand their conditions.
Insurers and other firms that companies hire to evaluate disability claims win business in part based on their ability to minimize employers’ costs. Their job requires weighing financial considerations against an obligation to facilitate leave for workers who need it.
In Gimotea’s case, the insurance administrator was “contradicting medical advice,” he said.
The subjectivity problem
Covid-19 fueled sharp increases in diagnoses for depression, anxiety, addiction and other disorders. In 2022, 59.3 million U.S. adults reported having a mental illness, compared with 47.6 million in 2018, according to government data. In that time, the share of adults with a serious mental illness—a diagnosable disorder that interfered with one or more daily activities—rose to 6% from 4.6%.
Since the pandemic, many employers have added benefits such as meditation and sleep apps, increased the number of free therapy visits offered through employee-assistance programs and given out extra paid days off.
Large employers typically offer disability insurance as a perk so that workers can collect part of their income if they suffer a major accident or illness. In 2023, around 40% of private-sector nonunion workers had access to disability benefits, according to government data. Employers usually pay the insurance premiums, and an insurer or third-party administrator makes benefit decisions and handles the paperwork.
Disability claims for mental illness have risen, accounting for around 7% to 10% of all long-term and short-term disability claims in recent years, up from 4% in the early 2000s.
Information on disability-claim denials and approvals is scarce because insurers and third-party administrators aren’t required to disclose that information to the Labor Department or other regulators. Some individual firms release their numbers. Claims administrator Sedgwick says it turned down about 30% of mental-health claims in 2023, compared with 18% of all other claims.
The primary reason for the higher denials was that the medical documentation submitted was insufficient, said David Setzkorn, head of Sedgwick’s workforce absence and disability practice. Research on disability-benefit denials conducted in 2017 by an insurance-industry group found that claims of all types were most commonly denied because the claimant returned to work or the insurance firm determined the person wasn’t disabled.
Insurance-industry experts say mental-health claims are difficult to administer because diagnoses can seem subjective.
“How do you medically prove some of these things?” said Phil Lacy, head of the health and productivity practice at consulting firm Marsh McLennan Agency. “If I broke my arm, I’ve got an X-ray that shows a broken bone. But claims with subjective symptoms are very difficult, and it’s hard to get at the level of detail that helps you understand the severity.”
Six months of paperwork
Gimotea found what he called his dream job in 2020 as a social-media manager with furniture and design firm MillerKnoll, which owns the brands Design Within Reach and Herman Miller. The pace was intense, he said, and 60-hour workweeks were common as he managed a growing set of responsibilities on his own.
Over time, he said, the workload wore him down and his relationship with his manager deteriorated. Gimotea had been diagnosed years earlier with generalized anxiety disorder and other mental disorders, and his symptoms flared under the pressures from work.
“In this remote world where you can see someone only on camera, I look put together,” the 37-year-old said. “But when you turn off the screens, you don’t see that someone is crying or hyperventilating.”
In May 2023, Gimotea took a leave of absence on his doctor’s recommendation. He applied for short-term disability benefits from the MillerKnoll’s claims administrator, New York Life, to cover 70% of his income while he wasn’t working.
The benefits never kicked in. Over the next six months, he said, applying for his benefits and then filing appeals of the subsequent denials became his full-time job. No matter how much documentation he and his doctors provided, he said, New York Life requested more.
Eventually, his final appeal was denied. Gimotea said New York Life based its decision in part on his going on vacation with his parents, saying it was evidence that he wasn’t incapacitated by his disabilities.
Gimotea returned to work in December. He said MillerKnoll fired him in January, telling him that his job performance was inadequate. Gimotea sued the company and New York Life.
MillerKnoll and New York Life didn’t respond to requests for comment. In a legal filing, New York Life denied Gimotea’s allegations.
The case was settled in April. Details of the settlement were unavailable.
A ‘systemic issue’
Courts have prohibited financial penalties when companies turn down claims that judges determine they should have approved.
“As a result, there is very little accountability,” said Mark DeBofsky, a disability-benefits attorney in Chicago. And because payouts are low without the prospect of financial penalties, many lawyers won’t take on disability cases, he and other attorneys said.
Lawyers, medical providers and individuals who have requested disability benefits say they often encounter significant resistance. Insurers and companies that administer benefits ask for several evaluations, questioning the diagnoses and recommendations of workers’ physicians, therapists and psychiatrists and asking workers to pay for neuropsychological testing that can cost thousands of dollars.
Eddie Dabdoub, a Florida lawyer who specializes in disability-benefits law, said that receiving—and appealing—claim denials can intensify clients’ symptoms. In some cases, unable to afford an unpaid leave, they continue working as their distress grows.
One of Dabdoub’s clients, a sales representative at Salesforce, has bipolar disorder along with depression and anxiety. In February 2023, his conditions worsened. On his doctors’ recommendation, he stepped away from his job and applied for long-term disability benefits under the company’s plan, which is administered by Metropolitan Life Insurance, or MetLife.
While waiting for MetLife’s decision, the sales rep attended two intensive outpatient programs that his psychiatrist had referred him to. His medical team also recommended that he attend a residential or partial-hospitalization program.
MetLife didn’t issue a decision within its mandated 45-day window, which effectively counts as a denial.
After the sales rep filed a lawsuit, MetLife agreed to approve the benefits.
Salesforce declined to comment, and a MetLife spokeswoman said the company doesn’t comment on litigation.
Earlier this year in a presentation about employee benefits, MetLife’s head of U.S. group benefits, Todd Katz, said of mental health: “We have a systemic issue here in the U.S. that we know about. No one’s really figured this out end to end but, boy, figuring it out is really, really important.”
Source: Wall Street Journal
