DOL Rejects Plan’s Reasons for Refusing to Provide Recording and Transcript of Claim-Related Conversation

The DOL has issued an information letter rejecting several reasons for refusing to provide a claimant with an audio recording and transcript of a claim-related telephone conversation that was created for “quality assurance.” (As background, for a plan to provide “full and fair review” of an adverse benefit determination as required by the DOL’s claims procedure regulations, a claimant must be given—upon request and free of charge—copies of all documents, records, and other information relevant to the claim.) The DOL issued this information letter to a lawyer whose client (the claimant) was denied access to a recording of a conversation between the claimant and a representative of the plan’s insurer. The plan’s stated reasons for refusing to provide the recording were that the recording was not created, maintained, or relied on for claim administration; it was used simply for quality assurance purposes; and it was distinct from the contemporaneous notes documenting the conversation that were part of the administrative record used for tracking and administering the claim (and made available to the claimant).

The DOL explained that a document, record, or other information is “relevant” to a claim if it was generated in the course of making the benefit determination, regardless of whether the item was actually relied on in making the determination or created for claim administration purposes. Moreover, because the regulations specify that information is relevant if it demonstrates compliance with the required claims procedures, the fact that a recording was made for quality assurance purposes supports, rather than negates, its relevance. Lastly, the DOL pointed out that nothing in the regulations requires that items subject to this disclosure requirement consist only of paper or written materials. In fact, the preamble to the regulations recognizes that audio recordings can be part of the administrative record.

EBIA Comment: Failure to comply with the claims procedure regulations—including by failing to provide relevant documents upon request—can have legal consequences that may affect the outcome of benefit disputes that end up in court. Among other things, the claimant may be excused from having to exhaust the plan’s claims procedures, and a court may apply a less deferential standard when reviewing the plan’s decision. In addition, group health plans may be subject to an excise tax for failing to provide full and fair review. Given these consequences, any proposal to withhold requested documents, records, or other information (in any format) from a claimant should be discussed with experienced benefits counsel. For more information, see EBIA’s ERISA Compliance manual at Sections XXXIV.H.6 (“Access to and Copies of Information ‘Relevant’ to Claim”) and XXXV.F (“Procedures for Processing Disability and Other Non-Health Claims and Appeals”). See also EBIA’s 401(k) Plans manual at Section XXX.E (“Appeal of Adverse Benefit Determinations”) and EBIA’s Self-Insured Health Plans manual at Section XXVI.G (“Full and Fair Review”).

Contributing Editors: EBIA Staff.