SNAP Challenge Day Two – Cheating

The SNAP challenge rules are clear. They say “avoid accepting free food…at work,” I read all of the rules beforehand. Carefully.

Yet, within hours of beginning the SNAP challenge on Monday, I had cheated. I had a couple of cookies at work. Monday night, after dinner, I had two (small) handfuls of pumpkin seeds and two more of chocolate-covered sunflower seeds. On Tuesday, I had a slice of fruit bread at work and, after dinner, some dried apricots and more pumpkin seeds. At least I’ve managed to resist my coworker’s candy bowl.

When we were planning our week, my wife and I didn’t think about desserts and snacks. It doesn’t matter, we couldn’t have afforded them anyway. It’s not that I really needed the cookies and the pumpkin seeds, it’s just that a dinner of rice and beans, or baked chicken and potatoes, no matter how delicious, isn’t quite satisfying. I craved a few more tastes.

Which got me thinking about that 8% cut in SNAP benefits that occurred in November 2013. When I’ve written or talked about this before, I focused on the monetary amount that families of different sizes were losing under the cut.

But it isn’t really about the money. Rather, it’s about having the capacity to put a little variety into one’s diet. And, for a family, the opportunity to provide an occasional treat to the children. Not just three square meals a day, but some simple desserts and snacks too.

Some think SNAP recipients should only be able to use their benefits to purchase nutritious necessities. Why should the taxpayer subsidize desserts and snacks? But I would argue, based on my SNAP challenge experience, that it’s not really about the desserts and snacks either. What it’s really about is having the freedom and the agency to put some variety into your own and your children’s lives, to have some fun, to not always have to put your nose to the grindstone when you plan, budget, and do your weekly shopping. Doesn’t every kid deserve to have Flamin’ Hot Cheetos once in a while?

 

SNAP Challenge Day One – We Miscalculated Our Benefits

Yesterday, my meeting west of downtown Chicago ended at 1:00. Normally I would have had lunch at my favorite lunch spot in the city just a half block away. Not this week.

Red alert. My wife and I have been planning, budgeting, and shopping with the understanding that we could spend a bit over $1.50 per person per meal, which comes to $35 per person for the week, or $70 for the two of us. It turns out we were using obsolete SNAP challenge instructions, and we actually have only $1.40 per person per meal, or $60 per week for the two of us.

So we have $10 less to spend on food for the week than we thought we had. Last week we wouldn’t have cared about shaving $10 off our food bill. This week it’s a crisis.

The SNAP challenge instructions we used did not take into account that SNAP benefit amounts were cut by 8% across-the-board in November 2013, the largest benefit cut in history.

Miscalculating the amount of SNAP benefits we would have at our disposal for the week was our fault for using obsolete instructions. In contrast, SNAP recipients received no advance notice that their benefits would be cut by 8% in November 2013. They found out when they received their November benefits that they would just have to make due on $10 less for a family of two, $20 less for a family of four.

Arkansas court grants Hartford’s motion for summary judgment for claimant’s failure to exhaust administrative remedies

This is yet another case shedding light on the importance of timely exhausting administrative remedies before filing an ERISA lawsuit. In this recent case, which was decided by a U.S. District Court in Arkansas, Mr. Deaton, a former Walmart Stores employee, was on claim for disability with Walmart’s disability insurer, Hartford Life and Accident Insurance Company (“Hartford”).

On April 4, 2012, Hartford approved Mr. Deaton’s previously made claim for long term disability benefits. On December 17, 2012, Mr. Deaton received a letter from Hartford discontinuing his benefits effective March 25, 2013. Like most termination letters terminating benefits under an ERISA governed disability plan, the letter stated that Mr. Deaton had the right to appeal the decision within 180 days from the receipt of the December 17, 2012 letter (180 days from the date of the letter would have been June 15, 2013).

On May 2, 2013, Mr. Deaton, through his lawyer, replied to Hartford by a letter requesting a copy of the policy at issue, additional time to submit an appeal, and confirmation that the appeal period began on March, 25, 2013 (the effective date the claim was terminated).

Hartford responded by providing a copy of the policy but did not address the other issues that Mr. Deaton’s attorney had raised. On July 8, 2013, Mr. Deaton’s attorney contacted Hartford by phone. After the conversation, during which a Hartford representative had informed Mr. Deaton’s attorney that a request for additional time should be submitted in writing and that there was no “foreseeable reason why the request would be denied,” Mr. Deaton’s attorney submitted a written request the same day.
On August 7, 2013, Hartford denied Mr. Deaton’s request for additional time to appeal.

On October 16, 2013, Mr. Deaton filed a lawsuit against Hartford in the Circuit Court of White County, Arkansas. The action was removed by Hartford to Federal Court on December 2, 2013 and on January 8, 2014 Hartford filed a motion to dismiss Mr. Deaton’s complaint arguing that Mr. Deaton’s complaint must be dismissed because Mr. Deaton failed to exhaust his administrative remedies. Hartford argued that Mr. Deaton failed to file a timely administrative appeal and that the time for doing so had passed.

In response to Hartford’s motion, Mr. Deaton argued that his correspondence with Hartford satisfied the exhaustion requirement because it provided adequate notice of an appeal by clearly bringing the issue to Hartford’s attention.

However, the Court, relying on 8th Circuit precedent, determined that Hartford reasonably could have construed the May letters as not providing adequate notice of an appeal or constituting an appeal but instead as mere requests for documents that Mr. Deaton’s lawyer sought to review before determining whether to file an appeal in the future.

The Court ultimately granted Hartford’s motion and dismissed Mr. Deaton’s action with prejudice.
It is unclear at what point Mr. Deaton sought an attorney to handle his claim. The facts suggest that, like many disability claimants whose ERISA claims have been denied, Mr. Deaton waited until only a few weeks were remaining to file an appeal before retaining an attorney. It would seem that, although Mr. Deaton received the letter of termination on December 17, 2012, the effective date benefits were terminated did not occur until March 25, 2013 and so Mr. Deaton may have felt no immediate pressure to submit an appeal until after his benefits had run out.

Unfortunately, Mr. Deaton and his attorney ran out of time and may have not realized the importance of the 180-day deadline in ERISA governed disability claims. This case serves as an additional reminder of the importance of seeking advice from an experienced ERISA attorney as early as possible after your claim is denied.

Arkansas court grants Hartford’s motion for summary judgment for claimant’s failure to exhaust administrative remedies

This is yet another case shedding light on the importance of timely exhausting administrative remedies before filing an ERISA lawsuit. In this recent case, which was decided by a U.S. District Court in Arkansas, Mr. Deaton, a former Walmart Stores employee, was on claim for disability with Walmart’s disability insurer, Hartford Life and Accident Insurance Company (“Hartford”).

On April 4, 2012, Hartford approved Mr. Deaton’s previously made claim for long term disability benefits. On December 17, 2012, Mr. Deaton received a letter from Hartford discontinuing his benefits effective March 25, 2013. Like most termination letters terminating benefits under an ERISA governed disability plan, the letter stated that Mr. Deaton had the right to appeal the decision within 180 days from the receipt of the December 17, 2012 letter (180 days from the date of the letter would have been June 15, 2013).

On May 2, 2013, Mr. Deaton, through his lawyer, replied to Hartford by a letter requesting a copy of the policy at issue, additional time to submit an appeal, and confirmation that the appeal period began on March, 25, 2013 (the effective date the claim was terminated).

Hartford responded by providing a copy of the policy but did not address the other issues that Mr. Deaton’s attorney had raised. On July 8, 2013, Mr. Deaton’s attorney contacted Hartford by phone. After the conversation, during which a Hartford representative had informed Mr. Deaton’s attorney that a request for additional time should be submitted in writing and that there was no “foreseeable reason why the request would be denied,” Mr. Deaton’s attorney submitted a written request the same day.
On August 7, 2013, Hartford denied Mr. Deaton’s request for additional time to appeal.

On October 16, 2013, Mr. Deaton filed a lawsuit against Hartford in the Circuit Court of White County, Arkansas. The action was removed by Hartford to Federal Court on December 2, 2013 and on January 8, 2014 Hartford filed a motion to dismiss Mr. Deaton’s complaint arguing that Mr. Deaton’s complaint must be dismissed because Mr. Deaton failed to exhaust his administrative remedies. Hartford argued that Mr. Deaton failed to file a timely administrative appeal and that the time for doing so had passed.

In response to Hartford’s motion, Mr. Deaton argued that his correspondence with Hartford satisfied the exhaustion requirement because it provided adequate notice of an appeal by clearly bringing the issue to Hartford’s attention.

However, the Court, relying on 8th Circuit precedent, determined that Hartford reasonably could have construed the May letters as not providing adequate notice of an appeal or constituting an appeal but instead as mere requests for documents that Mr. Deaton’s lawyer sought to review before determining whether to file an appeal in the future.

The Court ultimately granted Hartford’s motion and dismissed Mr. Deaton’s action with prejudice.
It is unclear at what point Mr. Deaton sought an attorney to handle his claim. The facts suggest that, like many disability claimants whose ERISA claims have been denied, Mr. Deaton waited until only a few weeks were remaining to file an appeal before retaining an attorney. It would seem that, although Mr. Deaton received the letter of termination on December 17, 2012, the effective date benefits were terminated did not occur until March 25, 2013 and so Mr. Deaton may have felt no immediate pressure to submit an appeal until after his benefits had run out.

Unfortunately, Mr. Deaton and his attorney ran out of time and may have not realized the importance of the 180-day deadline in ERISA governed disability claims. This case serves as an additional reminder of the importance of seeking advice from an experienced ERISA attorney as early as possible after your claim is denied.

Taking the SNAP Challenge: Step One-Shopping

Millions of low-income Americans rely on SNAP (food stamp) benefits to support their families. But what is it like to shop, cook, and eat on a SNAP budget?  

For years I have worked on behalf of community members facing this real day-to-day challenge. And I have urged others who, like me, don’t have to rely on SNAP to take the SNAP challenge by committing to limit their food purchases for one week to a standard SNAP allotment of $35 per person. I have been doing this without ever having taken the SNAP challenge myself.

At a recent meeting, I urged 40 members of the clergy to take, and have their parishioners take, the SNAP challenge, and I promised them I would be doing so myself at the next opportunity. I figure that’s not a good audience to break your promise to, and so my wife and I are taking the SNAP challenge this week.

Yesterday we carefully planned our week. High protein cereal for breakfast, homemade salads for lunch, and dinners (two nights each) of black beans and rice, baked chicken and potatoes, and pasta and broccoli. For fruit we’ll have a watermelon, which is not my favorite but which seems like it will stretch the farthest.

What I hadn’t realized was how stressful the experience would be before we even got started. I just returned from doing the week’s shopping at my local grocery. It was very difficult.

I never appreciated the hardship of making sure that you don’t check out over-budget for a simple weekly shopping trip. I’m pretty good with numbers, so keeping count as I rambled down the aisles was not the hard part.

So, I shopped.  I couldn’t take advantage of many of the sale items at the store since I was limiting my purchases to the bare minimum.  I put a couple of onions in a bag—but wait—could we do with one onion?  I opened the bag and put one back. Another shopper gave me a stern look.  My plan for salads turned out to be the most expensive choice, of course.  Gee, that red and green leaf lettuce is expensive!

Coffee. I won’t be visiting the neighborhood Starbucks this week. Can’t I splurge on something? And Starbucks is $2 off and $1 less than Peet’s. When I got home from the store, my wife scoffed.

I needed a whole cut-up chicken fryer. Pretty expensive. I fished through the bin and found the smallest one; there, I saved a dollar. I later learned I could have saved more if I’d bought a whole fryer and cut it up myself.

I got lucky on the lunch meat; Hillshire’s 3 for $10.

Now the moment of truth—how much did I spend? I had lost track and really had no idea. What if I went over budget? I kept imagining how embarrassed I would be with the checker and other shoppers behind me as I tried to figure out what needed to go back and what could stay. Would they be rolling their eyes at this incompetent shopper who was thoughtlessly taking up everyone’s time.

In the end, I spent $49.97. We have $20 left. I think we’ll make it through the week pretty unscathed, even counting the cost of last week’s red peppers that we’ll put in our salads, and milk and yogurt also leftover from last week. (But wait, we’re having dinner with an old friend who will be in town on Friday and our restaurant bill counts. Looks like its fast food or bust.)

At the end of the week, what will we have proved? That a couple of temporarily frugal 50 somethings with advanced degrees and a lifetime of shopping and cooking experience, unlimited planning and cooking time (not to mention drawers of spices and cabinets of equipment), and no kids demanding our attention, can make it for one week on SNAP?  Still, I have already learned a lot about the stress SNAP recipients face in planning and shopping for a week’s groceries. And, although there’s a vast difference between eating beans and rice for a week and eating beans and rice for a year or more, I expect to learn more as I continue on the SNAP challenge.

I’ll be blogging on this all week.

The Role of Unemployment Insurance in Keeping People Housed

As further evidence that the foreclosure crisis is coming to a close, July 2014 marked the 46th consecutive month of year-over-year decreased foreclosure activity in the U.S. While Illinois still experienced the fourth highest level of foreclosure activity among the states, foreclosure activity was still down from a year ago, for the 20th consecutive month. As the crisis improves nationally, it is important to assess what has worked and not worked in bringing relief. Federal programs targeting families in distress show a broad reach but perhaps less impact than hoped. And one new study has illuminated how unemployment insurance appears to have played a surprisingly important role in curbing foreclosures during the Great Recession. 

Predictably, the billions of dollars spent to prevent foreclosures through federal recovery programs have had a positive impact. The Home Affordable Modification Program (HAMP) program saved nearly a million households from foreclosure. Moreover, through March of this year, the federal Hardest Hit Fund (HHF) spent $3.6 billion to help over 178,000 households avoid foreclosure. These programs and others such as those funded by Department of Justice settlements directly target families in distress and have made some of the on-the-ground difference communities need. But, while we should continue to make programs like HAMP and HHF available to families at risk of foreclosure, these programs did fall short of their goals and served far fewer families than initially planned.   

A loss of income undeniably impacts a household’s ability to pay the mortgage, but the receipt of unemployment insurance benefits has not previously been considered as a tool for foreclosure prevention. A July 2014 report on a study from the Federal Reserve and the Kellogg School of Management may change that. The study found a direct correlation between a state’s extension of unemployment insurance benefits and a decline in mortgage delinquency and default, and foreclosure-related relocations and evictions. 

According to the study, unemployment insurance benefits in states with higher maximums prevented significant numbers of delinquencies among laid-off workers. Where unemployment insurance benefits were higher, foreclosure-related evictions were cut almost in half. Moreover, federal measures that extended the length of unemployment insurance during the recent recession also prevented delinquencies by similar rates. 

These results underscore the significant role that unemployment insurance can have in preventing unemployed homeowners from losing their homes. The researchers found that, as a result of unemployment insurance extensions between 2008 and 2013, approximately 2.7 million delinquencies were averted, and 1.4 million foreclosures prevented. Thus, unemployment insurance helped more homeowners than other federal foreclosure prevention programs, and should be considered as a key foreclosure prevention strategy. 

The benefits of unemployment insurance don’t end there. The research additionally found that increased unemployment insurance benefits resulted in better credit access for laid-off workers, both in terms of credit availability and lower interest rates. The study also revealed more dramatic benefits to lower-income households, in particular households earning less than $35,000 a year – those individuals just below HUD’s Area Median Income for Chicago, for example, who are more likely to be more housing cost-burdened.

By keeping people housed at all income levels after they lose work, we can reduce reliance and strain on other programs. Since housing, wages, and available income are all interrelated in our economy, an improvement in one arena is likely to have an effect across the board, particularly in times of crisis.

 

How Do I Get Attorney Fees Awarded In An ERISA Disability Benefit Appeal or Denial?

Long term disability lawyers Gregory Dell and Rachel Alters recently released an educational video which discusses the issues surrounding an award of attorney fees in ERISA disability claim. In this video, they discuss the standards that must be satisfied to win attorney fees and the difficulties that can arise in a court awarding ERISA attorney fees.

Greg and Rachel have litigated the issue of attorney fees extensively and this video was designed to discuss the most common issues. If you have been denied disability insurance benefits and have been forced to file a lawsuit, then you may be able to recover attorney fees. Contact any of our disability insurance lawyers to learn more about how Attorneys Dell & Schaefer may be able to assist you.

Support the ABLE Act

A seven-year battle to pass the Achieving a Better Life Experience (ABLE) Act may culminate this month in a victory for asset-building, health care, and disability rights advocates—especially if Congress hears our voices loud and clear. The bill would allow individuals with disabilities to save up to $100,000 in a tax-sheltered savings account without the fear of losing federally funded public benefits. Currently the asset limit for recipients of Supplemental Security Income (SSI) and Medicaid is a very low $2,000 per individual. This means that most individuals with disabilities can have no more than $2,000 in accumulated income, such as in a retirement or savings account.

Asset limits force people to “spend down” what little financial resources they may have, making it impossible for them to cope with financial emergencies or to achieve a foothold toward financial independence. For people with disabilities who cannot work, or who can work with supports that may be lost at any time, saving money for the future is vitally important. Currently, setting up a trust fund—a complicated and expensive option that does not allow the beneficiary to save on his or her own behalf—is the only way an individual with disabilities can avoid the asset limit. With ABLE 529 accounts, someone like Sara Wolff, an activist with Down syndrome fighting to pass the ABLE Act, will be able to keep her benefits, save on her own behalf, and keep working. Sara works in a law office and receives SSI benefits, but currently cannot accumulate more than $2,000 in assets without becoming ineligible for that aid.

The ABLE Act would amend Section 529 of the Internal Revenue Service Code to establish tax-exempt ABLE accounts to assist individuals with disabilities and their families in building savings to pay for qualified disability expenses, including expenses related to education, primary residence, transportation, obtaining/maintaining employment (job training), health and wellness, and other personal support expenses. Currently in Illinois, only people with disabilities who are working and enrolled in the Health Benefits for People with Disabilities Program (HBWD) are allowed to have up to $25,000 in assets and continue to receive Medicaid health coverage.  Advocates sought a generous asset limit in the HBWD (which is Illinois’s Medicaid buy-in program authorized under the federal Ticket to Work–Work Incentives Improvement Act) to encourage employment and asset building among people with disabilities. Passage of the ABLE Act would take asset-building for people with disabilities to a new level by allowing people with disabilities, working or not, to accumulate even more assets, as well as maintain all federally funded public benefits, not just Medicaid coverage.

Passage of the ABLE ACT would also be a boon to policies that support state and federally facilitated savings programs. One in five Americans has zero or negative net worth, and nearly half of households are without a basic personal safety net to prepare for emergencies or future needs. It is vitally important that we continue to support policies that create savings opportunities for low- and moderate-income families, such as children’s savings accounts (implemented through Bright Start in Illinois), ABLE accounts for persons with disabilities (pending in Congress), as well as Illinois’s automatic-IRA program, The Secure Choice Savings Program (pending in the Illinois General Assembly).

In August, Republicans and Democrats on the House Ways and Means Committee unanimously voted in favor of the ABLE Act. The bill has strong support in both chambers of Congress (379 co-sponsors in the House and 74 in the Senate). This showing of bipartisan support exemplifies the growing understanding that asset limits exacerbate poverty and perpetuate financial instability. According to CFED, Congress returns to Washington in early September and may take up this bill soon after. Contact your representative and senators and tell them to support the ABLE Act!

  • Call 202.224.3121 and ask to be connected to your senators’ and representative’s offices. If you don't know who your representative or senators are, find out here: House, Senate.
  • Once you're connected, here's what to say:
    My name is [your name] from [your organization or coalition]. I’m calling to ask you to support H.R. 647 / S. 313, the ABLE Act of 2013, so that people with disabilities are able to save, expand their economic opportunity and have the chance to gain economic self-sufficiency.

 

Stephanie Altman contributed to this blog post.

 

 

Deepwater Horizon Ruling Places $18b Bull’s-Eye on BP

Barger & Wolen partner David McMahon was quoted in a Law360 article, Deepwater Horizon Ruling Places $18b Bull's-Eye on BP subscription required), on September 4, 2014, about U.S. District Judge Carl J. Barbier’s ruling which found BP’s actions in the Deepwater Horizon disaster grossly negligent. The ruling holds BP responsible for up to $18 billion in Clean Water Act penalties and leaves open the possibility of billions more in punitive damages.

The 153-page ruling issued September 4th thoroughly laid out why the negative pressure test botched by BP prior to the Macondo well blowout constituted gross negligence and even if it didn't, a series of negligent actions by BP added up to gross negligence.

While negligent acts were committed by individual BP employees, the court seemed to adopt a broader definition of a person under the CWA to include the company as well, said David McMahon, a Barger & Wolen LLP partner who worked on the early phases of the BP litigation.

Essentially, the [judge] suggested that corporate ratification was not required to have the enhanced level of penalties stick,” McMahon said. “That was an interesting analysis.”

While Judge Barbier found that BP and drilling partners Transocean Ltd. and Halliburton Co. were each liable under general maritime law for the blowout, explosion and oil spill, he also said Transocean and Halliburton’s indemnity and release clauses in their respective contracts with BP are valid and enforceable.

Barger & Wolen and Hinshaw & Culbertson Announce Merger

Combined Firms Create Powerhouse Insurance Practice with 120 Attorneys Dedicated to Serving the Insurance Industry

  

Chicago and Los Angeles — September 2, 2014 — Barger & Wolen and Hinshaw & Culberston, a national law firm with 460 lawyers in 22 offices around the country, announced today they will combine forces. The merger creates one of the largest insurance law practices in the United States with 120 full-time attorneys dedicated to providing legal counsel to insurance companies and financial services firms that shape the insurance industry.

The partner votes took place on August 28, 2014, and the merger will become effective on October 1, 2014. The combined firm will keep the name Hinshaw & Culbertson and have over 500 attorneys in 11 states as well as London.

Click here for the full press release. For more information, contact Heather Morse.