Health and Disability Claims: Initial Decisions and Required Notices

Adapted from Compliance Assistance - Group Health and Disability Plans Benefit Claims Procedure Regulation (29 CFR 2560.503-1), published by the U.S. Department of Labor; selected section: C. Initial Benefit Determinations — § 2560.503-1(f) and (g). The source text is reproduced with headings and formatting adjusted for this guide.

C. Initial Benefit Determinations — § 2560.503-1(f) and (g)

The following questions relate to the timing and notification requirements applicable to the initial (or first-level) determination of a benefit claim.

Q-C1: When does the time period for making an initial decision on a claim begin to run?

A: The time for making an initial claims decision begins to run when the claim is filed in accordance with a plan's reasonable filing procedures, regardless of whether the plan has all of the information necessary to decide the claim at the time of the filing.

For purposes of calculating the time period within which a claim must be decided, a plan cannot extend the time period by treating as "filed" only those claims with respect to which all the information necessary to make a decision has been submitted (often referred to as "clean" claims). (See § 2560.503-1(f)(4).)

Q-C2: May a plan's claims procedures require claimants to submit relevant medical information or information relating to "coordination of benefits" prior to the plan's making a decision on a claim?

A: Plans have considerable flexibility in defining the procedures to be followed for the initiation, processing, and appeal of benefit claims. However, while plans may require the submission of specific information necessary to a benefit determination under the terms of the plan, including medical and "coordination of benefit" information, the plan may nonetheless have to make a decision on the claim before receiving such information. As noted in Q-C1, the time periods applicable to deciding claims begin to run on the date a claim is filed in accordance with reasonable procedures of the plan, without regard to whether all the information necessary to make a benefit determination accompanies the filing. (See § 2560.503-1(f)(4).)

Q-C3: If the period within which a group health claim must be decided is ending and the claimant has yet to furnish all the information necessary to decide the claim, may the plan extend the time period for deciding the claim and, if so, for how long?

A: In general, a group health plan may unilaterally extend the decisionmaking on both preservice and postservice claims for 15 days after the expiration of the initial period if the administrator determines that such an extension is necessary for reasons beyond the control of the plan. There is no provision for extensions in the case of claims involving urgent care.

If the reason for taking the extension is the failure of the claimant to provide information necessary to decide the claim, and the claimant is so notified of this fact, the time period for making the decision is suspended ("tolled") from the date of the notification to the claimant to the earlier of: (1) the date on which a response from the claimant is received by the plan; or (2) the date established by the plan for the furnishing of the requested information (at least 45 days).

The extension period (15 days) – within which a decision must be made by the plan – will begin to run from the date on which the claimant's response is received by the plan (without regard to whether all of the requested information is provided) or, if earlier, the due date established by the plan for furnishing the requested information (at least 45 days). (See §§ 2560.503-1(f)(2)(iii)(A) and (B); 2560.503-1(f)(4); 2560.503-1(i)(4). Also see 65 FR at 70250, n.21.)

Q-C4: Many plans, including group health and disability plans, require claimants to submit to examination by an expert or experts of the plan's choosing in connection with the plan's consideration of the claimant's claim. How do the regulation's time limits apply to the completion of such examinations?

A: The regulation's time limits begin to run when a claim is filed in accordance with the reasonable procedures of the plan for filing claims. (See Q-C1.) A plan that requires a physical or other examination of the claimant to evaluate a claim must design a process that provides for decisionmaking within the timeframes of the regulation.

If necessary, however, in the circumstances of a specific claim, a plan may take an extension of time to enable the claimant to submit requested information (including the report of a required examination). The regulation's provisions on extensions of time and tolling, discussed in Q-C3, would apply to these situations to determine when an extension is permitted and when an extension would begin and end. Under those rules, when a plan takes an extension of time because additional information must be obtained from a claimant, the claimant must be provided at least 45 days within which to provide the information or submit to the requested examination. Plans may, of course, provide claimants longer periods of time for this purpose.

Q-C5: May a claimant agree to an extension or further extension of the time period within which a plan must decide a claim?

A: Yes. The only limits on extensions of time established by the regulation are imposed on plans. Claimants may voluntarily agree to provide a plan additional time within which to make a decision on a claim, even under circumstances where the plan could not unilaterally extend the decisionmaking period, such as in the case of a claim involving urgent care or a claim on appeal. (See §§ 2560.503-1(f)(2)(i); 2560.503-1(i). Also see 65 FR at 70250, n.21.)

Q-C6: What responsibility does the plan have for determining whether any specific claim involves urgent care and must, therefore, be decided on an expedited basis?

A: A plan has a duty to make this determination on the basis of the information provided by, or on behalf of, the claimant. A claim involving urgent care is any claim for medical care or treatment with respect to which the application of the time periods for making nonurgent care determinations could seriously jeopardize the life or health of the claimant or the claimant's ability to regain maximum function, or — in the opinion of a physician with knowledge of the claimant's medical condition — would subject the claimant to severe pain that cannot be adequately managed without the care or treatment that is the subject of the claim.

In determining whether a claim involves urgent care, the plan must apply the judgment of a prudent layperson who possesses an average knowledge of health and medicine. However, if a physician with knowledge of the claimant's medical condition determines that a claim involves urgent care, the claim must be treated as an urgent care claim. (See § 2560.503-1(m)(1).)

Q-C7: Under the regulation, urgent care claims must be decided as soon as possible, taking into account the medical exigencies, but not later than 72 hours after receipt, and preservice claims must be decided within a reasonable period of time appropriate to the medical circumstances, but not later than 15 days after receipt. Can a plan's claims procedures require claimants to explain or describe whether, and what, "medical exigencies" or "medical circumstances" exist?

A: Yes. While the Department has indicated that the time periods for decisionmaking are generally maximum periods and not automatic entitlements, the Department recognizes that assessments of the appropriate timeframe for making benefit determinations will, in large part, be dependent on the information provided by the claimant. Requesting specific information from the claimant regarding whether and what medical circumstances exist that may give rise to a need for expedited processing of the claim would appear to facilitate claims processing and, therefore, would not, in the view of the Department, be an unreasonable plan request. If, on the other hand, the plan believes based on its own review of the claim that expedited processing is required, it is the view of the Department that the claim must be processed on an expedited basis without regard to the claimant's failure to provide information relating to whether expedited processing is necessary.

Q-C8: If a claimant requests a plan to extend a previously approved course of treatment, by either increasing the number of treatments or the period of time for treatments, and that request is determined by the claimant's treating physician to be a claim involving urgent care, within what period must the plan approve or deny the claimant's request?

A: Under the "concurrent care" provisions of the rule, any request that involves both urgent care and the extension of a course of treatment beyond the period of time or number of treatments previously approved by the plan must be decided as soon as possible, taking into account the medical exigencies, and notification must be provided to the claimant within 24 hours after receipt of the claim, when the request is made at least 24 hours prior to the expiration of the prescribed period of time or number of treatments. If such a request is not made at least 24 hours prior to the expiration of the prescribed period of time or number of treatments, the request must be treated as a claim involving urgent care and decided in accordance with the urgent care claim timeframes, i.e., as soon as possible, taking into account the medical exigencies, but not later than 72 hours after receipt. (See § 2560.503-1(f)(2)(i) and (ii)(B).)

If a request to extend a course of treatment beyond the period of time or number of treatments previously approved by the plan does not involve urgent care, the request may be treated as a new benefit claim and decided within the timeframe appropriate to the type of claim, i.e., as a preservice claim or a postservice claim. (See § 2560.503-1(f)(2)(iii).)

Q-C9: In the case of a group health plan's decision to reduce or terminate a previously approved course of treatment, must claimants be afforded at least 180 days to appeal the plan's revised determination before the benefit can be reduced or terminated?

A: No. Under the "concurrent care" provisions of the rule, any reduction or termination of a course of treatment (other than by plan amendment) before the end of the previously approved period or number of treatments is treated as an adverse benefit determination. In such cases the rule requires that the plan administrator provide the claimant sufficient advance notice of the reduction or termination to allow the claimant to appeal and obtain a determination before the benefit is reduced or terminated. Generally, claimants must be afforded at least 180 days following an adverse benefit determination to appeal that determination. If the "180 day" rule applied to appeals under concurrent care provisions of the regulations, notifications of reductions or terminations would, in every instance, have to be given at least 6 months in advance of the termination or reduction. This was not the intention of the Department. Accordingly, while the Department is of the view that plans must afford claimants a reasonable period of time within which to develop their appeal of a proposed reduction or termination, plans are not required to assume that claimants will need the full 180 days to file such an appeal before the benefit can be reduced or terminated under the special rules governing concurrent care claims. (See § 2560.503-1(f)(2)(ii)(A).)

Q-C10: In what circumstances, if any, would a postservice claim be a claim involving urgent care?

A: "Postservice claims" are those claims with respect to which plan approval is not a prerequisite to obtaining medical services and payment is being requested for medical care already rendered to the claimant. Accordingly, a postservice claim would never constitute a claim involving urgent care within the meaning of the regulation.

A postservice claim is defined in the regulation as any claim for a benefit under a group health plan that is not a preservice claim. Preservice claims are those claims with respect to which the terms of the plan condition receipt of the benefit, in whole or in part, on approval of the benefit in advance of obtaining medical care. (See Q-C6, § 2560.503-1(m)(1), (2), and (3).)

Q-C11: If a claim is determined to involve urgent care when it is initially filed, must it automatically continue to be treated as urgent if it is denied and the claimant files an appeal, regardless of whether, at that time, medical services have actually been provided and the only question to be resolved is who will pay for such services?

A: No. The nature of a claim or a request for review of an adverse benefit determination should be judged as of the time the claim or review is being processed. If requested services have already been provided between the time the claim was denied and a request for review is filed, the claim no longer involves urgent care because use of the postservice timeframes for deciding the appeal could not jeopardize the claimant's life, health, or ability to regain maximum function, or subject the claimant to severe pain. (See § 2560.503-1(m)(1).)

Q-C12: If a claimant submits medical bills to a plan for reimbursement or payment, and the plan, applying the plan's limits on copayment, deductibles, etc., pays less than 100 percent of the medical bills, must the plan treat its decision as an adverse benefit determination?

A: Under the regulation, an "adverse benefit determination" generally includes any denial, reduction, or termination of, or a failure to provide or make payment (in whole or in part) for, a benefit. In any instance where the plan pays less than the total amount of expenses submitted with regard to a claim, while the plan is paying out the benefits to which the claimant is entitled under its terms, the claimant is nonetheless receiving less than full reimbursement of the submitted expenses. Therefore, in order to permit the claimant to challenge the plan's calculation of how much it is required to pay, the decision is treated as an adverse benefit determination under the regulation. Providing the claimant with the required notification of adverse benefit determination will give the claimant the information necessary to understand why the plan has not paid the unpaid portion of the expenses and to decide whether to challenge the "denial," e.g., the failure to pay in full. This approach permits claimants to challenge whether, for example, the plan applied the wrong copayment requirement or deductible amount. The fact that the plan believes that a claimant's appeal will prove to be without merit does not mean that the claimant is not entitled to the procedural protections of the rule. This approach to informing claimants of their benefit entitlements with respect to specific claims, further, is consistent with current practice, in which "Explanation of Benefits" forms routinely describe both payable and nonpayable portions of claim-related expenses. (See § 2560.503-1(m)(4).)

Q-C13: Under what circumstances is a plan required to notify a claimant of a benefit determination that is not an "adverse benefit determination," i.e., a complete grant of a claim?

A: In the case of urgent care claims and preservice claims, the regulation requires that claimants be apprised of the plan's benefit determination, whether the determination is adverse or a complete grant. The rules require that this notification be furnished in accordance with the timeframes generally applicable to urgent care and preservice claims. There is no specific notification requirement applicable to postservice claims that are fully granted. (See § 2560.503-1(f)(2)(i) and (iii).)

Q-C14: What information is a plan required to provide when giving notice of a claim determination that is not adverse (that has been completely granted), in the case of an urgent care or preservice claim?

A: The regulation does not specify the information that must be provided in notices of benefit determinations that are not adverse. However, in accordance with the regulation's general requirement of reasonableness, the Department anticipates that such notices will contain sufficient information to fully apprise the claimant of the plan's decision to approve the requested benefit(s). (See § 2560.503-1(f)(2)(i) and (iii)(A).)

Q-C15: When a plan has approved a benefit that will be provided over a period of time, such as a series of chemotherapy treatments, must the plan notify the claimant when the benefits end?

A: No. Provided that the plan complied with the regulation in adequately notifying the claimant regarding the scope of the benefit that was originally approved (e.g., for how long, how many treatments, etc.) and further provided that the plan has not decided to reduce or terminate early the course of treatment that was previously approved, the regulation does not require the plan to provide a formal notification that the course of treatment is coming to an end. (See § 2560.503-1(f)(2)(ii).)

Q-C16: May a notice of an adverse benefit determination generally state that "a rule, guideline or protocol may have been relied upon in making the benefit determination" and satisfy the requirements of the regulation?

A: No. The regulation provides that if an internal rule, guideline, protocol, or similar criterion was relied upon in making an adverse benefit determination, the notification of the adverse benefit determination must either set forth the rule, guideline, protocol, or criterion or indicate that such was relied upon and will be provided free of charge to the claimant upon request. A notice that merely indicates that a rule, guideline, protocol, or similar criterion may have been relied upon does not provide the claimant any specific information about the basis on which his or her claim was decided. Inasmuch as plans will know in every instance what rules, protocols, guidelines, etc. were relied upon in making a determination, providing an indication whether such was relied upon should not be difficult. Moreover, the Department is concerned that the routine inclusion of such statement in all adverse benefit determination notifications may undermine the significance of the required disclosure. (See § 2560.503-1(g)(1)(v)(A).) For similar reasons, a general statement in an adverse benefit determination notice would not be considered as satisfying the requirements of § 2560.503-1(g)(1)(v)(B). (Also see § 2560.503- 1(j)(5)(i) and (ii).)

Q-C17: Is a plan required to provide a copy of an internal rule, guideline, protocol, or similar criterion when the applicable rule, guideline, protocol, or criterion was developed by a third party which, for proprietary reasons, limits the disclosure of that information?

A: Yes. It is the view of the Department that where a rule, guideline, protocol, or similar criterion serves as a basis for making a benefit determination, either at the initial level or upon review, the rule, guideline, protocol, or criterion must be set forth in the notice of adverse benefit determination or, following disclosure of reliance and availability, provided to the claimant upon request. However, the underlying data or information used to develop any such rule, guideline, protocol, or similar criterion would not be required to be provided in order to satisfy this requirement. The Department also has taken the position that internal rules, guidelines, protocols, or similar criteria would constitute "instruments under which a plan is established or operated" within the meaning of section 104(b)(4) of ERISA and, as such, must be disclosed to participants and beneficiaries. (See §§ 2560.503-1(g)(v)(A) and (j)(5)(i); 65 FR at 70251. Also see §§ 2560.503-1(h)(2)(iii) and 2560.503-1(m)(8)(i); Advisory Opinion 96-14A (July 31, 1996).)

Q-C18: If a plan conditions continuation of disability benefit payments on a periodic confirmation of the claimant's disability and, in conjunction with such a confirmation, determines that the claimant is no longer disabled and, accordingly, terminates payment of benefits, must the plan treat the termination as an "adverse benefit determination" under the regulation?

A: Yes. Under the regulation, an "adverse benefit determination" includes any denial, reduction, or termination of a benefit. Accordingly, where a plan terminates the payment of disability benefits under such circumstances, the plan is required to provide the claimant a notification of adverse benefit determination and the right to appeal that determination consistent with the regulation. (See 29 CFR § 2560.503-1(m)(4), (g) and (h).) If, on the other hand, a plan provides for the payment of disability benefits for a predetermined, fixed period (e.g., a specified number of weeks or months or until a specified date), the termination of benefits at the end of the specified period would not constitute an adverse benefit determination under the regulation. Any request by a claimant for payment of disability benefits beyond the specified period, therefore, would constitute a new claim. (See 29 CFR § 2560.503-1(f)(3). Also see 29 CFR § 2560.503-1(f)(2)(ii).)

Q-C19: Does the regulation limit a plan's ability to establish a maximum period for the filing of initial claims for benefits?

A: No. The regulation does not contain any specific rules governing the period of time that must be given to claimants to file their claims. However, a plan's claim procedure nonetheless must be reasonable and not contain any provision, or be administered in any way, that unduly inhibits or hampers the initiation or processing of claims for benefits. Adoption of a period of time for filing claims that serves to unduly limit claimants' reasonable, good faith efforts to make claims for and obtain benefits under the plan would violate this requirement. (See 29 CFR § 2560.503-1(b)(3).)

Q-C20: What timeframes apply when an extension of time is required by a plan in connection with an initial disability benefit determination?

A: The regulation addresses two situations in which a plan may have an extension of time for making a disability benefit determination. The first situation is when a decision cannot be rendered due to any matter beyond the control of the administrator other than the need for additional information from the claimant. In this situation, the extension period is added to the period within which the determination is required to be made.

For example, if prior to the end of the initial 45-day period, the administrator determines that, for reasons beyond its control, a decision cannot be rendered, the plan may take up to an additional 30 days (i.e., 30 days in addition to the initial 45-day period). Similarly, if a decision cannot, for similar reasons, be rendered within the initial extension period, the plan may take up to an additional 30 days (i.e., 30 days in addition to the initial 30-day extension period) or up to a total of 105 days to decide the pending claim. (See 29 CFR § 2560.503-1(f)(3).) The second situation is when the plan requires additional information from the claimant to make a benefit determination. This situation is governed by the principles in Q-C3.

Q-C21: If a plan determines that a claim does not provide sufficient information, must the plan take an extension of time and request additional information from the claimant?

A: No. The provisions governing extensions of time are permissive and not mandatory. As such, plans may provide for taking extensions of time or not, and plan administrators may be given the discretion to decide whether to take an extension of time in connection with any individual claim. Consequently, as a general matter, a plan may deny claims at any point in the administrative process on the basis that it does not have sufficient information; such a decision would allow the claimant to advance to the next stage of the claims process.

Q-C22: If a group health plan determines that an extension of time is necessary in order to obtain additional information from a claimant, may the administrator as part of the notice to the claimant of the need for the extension of time also include a notice of adverse benefit determination applicable if the claimant fails to provide any information within the period prescribed by the plan (i.e., at least 45 days)?

A: Yes. If the notice clearly states that the claim will be denied if the claimant fails to submit any information in response to the plan's request, it is the view of the Department that the furnishing of a combined notice would not be contrary to the regulation, provided that the combined notice satisfied the content requirements applicable to both the extension notice and the notice of adverse benefit determination. In this regard, the notice of adverse benefit determination should make clear that the period for appealing the denied claim begins to run at the end of the period prescribed in the notice for submitting the requested information (or such later date as may be provided under the terms of the plan). (See 29 CFR § 2560.503-1(f)(2) and (3).)

This guide concerns U.S. workplace benefits and the federal rules described by the Department of Labor. The type of plan, its governing documents, and the facts of a claim matter. Government, church, and other excluded plans may follow different rules.

Source and scope

Compliance Assistance - Group Health and Disability Plans Benefit Claims Procedure Regulation (29 CFR 2560.503-1) — U.S. Department of Labor. Accessed October 28, 2026. This public domain federal guidance is an educational reference; use the source publication and the applicable plan or employment documents for the full context and later updates. Fynoptic is independent and is not endorsed by the Department of Labor.