Suit Says Cigna Subsidiary Uses Virus to Delay Benefit Decisions

June 8, 2020, 5:27 PM

A Colorado woman who on Monday sued Life Insurance Co. of North America for terminating her disability benefits claims the company is using the Covid-19 health crisis to slow-walk its internal appeals process in an effort to save money.

Windy Nesti, an engineer whose long-term disability benefits were terminated in 2019, accuses the Cigna subsidiary of dragging her appeal out well beyond the 45- and 90-day deadlines imposed by statute. Nesti says the company is using the disruptions caused by the health crisis to avoid issuing timely decisions, which allows it to keep earning interest off the benefits it would otherwise be paying.

“Upon information and belief, LINA has instituted a new procedure and practice of requesting a substantially greater number medical evaluations (so-called IMEs) in recent weeks and months, during the internal appeal phase, knowing that such in-person medical evaluations could not likely be conducted on a timely basis during the ongoing Covid-19 pandemic,” Nesti said in a complaint filed in the U.S. District Court for the District of Colorado.

According to Nesti, this new practice violates the Employee Retirement Income Security Act and is fueled by the company’s “desire to delay payment of compensable claims as long as possible in order recoup as much interest and/or return on equity.”

Causes of Action: Wrongfully denied benefits under the Employee Retirement Income Security Act.

Relief: Declaration of disability and entitlement to benefits, award of past-due benefits and reinstatement of benefits, attorneys’ fees, and costs.

Response: Cigna didn’t immediately respond to a request for comment.

Attorneys: McDermott Law LLC represents Nesti.

The case is Nesti v. Life Ins. Co. of N. Am., D. Colo., No. 1:20-cv-01642, complaint 6/8/20.

To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bloomberglaw.com

To contact the editor responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com

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