Introduction

One of the more controversial requirements under ERISA is that every participant seeking redress for an unlawfully denied benefit under an ERISA plan must first submit to an administrative review procedure maintained by the ERISA plan. Failure of the participant to exhaust these administrative review procedures within specified timeframes may result in the participant being denied access to the courts. Moreover, if a participant submits to the plan’s administrative review procedures and loses (i.e., the claim is again denied), and files a claim in court, the court may presume the correctness of the plan administrator’s decision absent a finding that the decision was arbitrary and capricious.

The rationale for the administrative claims review requirement is that it provides for a non-adversarial method of claims administration, and reduces the number of frivolous lawsuits. Thus, in cases where the administrative review procedures are properly utilized in good faith, they serve a valuable purpose. To maintain the integrity of the administrative review requirement, the U.S. Department of Labor (“DOL”) has promulgated extensive regulations setting forth minimum standards that must be satisfied. There is also a substantial body of case law regarding the proper application of ERISA’s administrative claims review procedures.

Following is a general discussion of the ERISA administrative claims review requirement, applicable DOL regulations, and relevant case law.