Archive for the ‘Claims Review’ Category

by Paul Raeburn, www.kaiserhealthnews.org

On the evening of March 1, 2008, Gary Diego was relaxing with his wife, Ellen, when she abruptly lost her hearing, began repeating herself, and seemed to be losing her grip. Read more

by Jeremy Smerd – Workforce Management, www.workforce.com  

A medical billing company may be blowing smoke, but could reimbursing patients for medical marijuana lower drug costs for employers? Read more

Reaction from AMA, TMA, GMA, Self-Funded Employer• Getahn Ward, The Tennessean, 5/16/09, Tennessee HRI Article

• Emily Berry, American Medical News, 4/13/09, AMedNews Article

• Tennessee Medical Association (TMA) Legal Department 5/5/09, TMA Alert on HRI Recoupment Letters
Franklin (TN)-based Health Research Insights, has temporarily halted efforts to collect on potential overpayments of medical claims by two Nashville-area self-insured employers to doctors and other health-care providers.

Under pressure from doctors, Metro Nashville Public Schools and Cookeville (TN)-based trucking company, Averitt Express Inc. asked Health Research Insights to stop sending letters that physicians say assume wrongdoing on their part without a review of related medical records. Read more

by Fred Schneyer of PLANSPONSOR, www.plansponsor.com

After tweaking their standard for how federal judges should handle employee benefits denial cases involving a conflicted plan administrator, federal appellate judges have ordered more hearings in just such a case. Read more

In Gagliano v. Reliance Standard Life Ins. Co., 2008 WL 4916330 (4th Cir. 2008), an employee’s claim for long-term disability benefits was denied on the ground that she was not disabled under the terms of the plan.  The court ordered an independent medical examination that stated the employee was disabled but the plan administrator (who was also the insurer) denied the claim on appeal based on the plan’s preexisting condition exclusion. Read more

Based on the Supreme Court’s decisions in MetLife and LaRue, employers should consider making changes and acting proactively to implement strategies to help ensure that plan disputes are channeled through a committee and that the committee’s decisions receive deference from the courts.

Many corporate officers, employees and board members serve as ERISA fiduciaries. For a fiduciary accused of breaching its duties under ERISA, the stakes are high. ERISA Section 409 imposes personal liability on a fiduciary that breaches its duty. ERISA authorizes lawsuits against fiduciaries by participants, beneficiaries, the plan administrator, other fiduciaries ,and the U.S. Department of Labor. The federal courts have uniformly held that ERISA’s fiduciary duty is “the highest duty known to the law.” Read more

TPAs rely heavily on ERISA’s requirements that claimants must exhaust their administrative remedies before going to court, and when they do sue, assuming that the Plan documents grant the claim administrator the appropriate discretionary authority, they must show that the claim administrator abused its discretion when denying their claim, before any court will get to the merits of their allegations.

Few plaintiffs are able to meet these burdens, and so either don’t sue or often get their lawsuits quickly dismissed.  Until recently most courts were not very sympathetic to plaintiffs’ arguments of procedural violations, but things are changing, the most significant development being the Supreme Court’s decision this summer in MetLife v. Glenn. Read more

by Ron E. Peck, Esq.

Offset: Denying future claims to reimburse the Plan for claims it has paid prior to third party settlement.  It is a form of lien reimbursement.

Denial of Future Medical Claims: Denying future claims because they were caused by, and are the responsibility of a third party with whom the insured has settled or will settle, and thus for which the insured has removed liability from the third party and shifted responsibility onto him or herself.

Confusion regarding how a benefit plan and its administrator handle future claims resulting from an incident for which another party is or may become responsible is widespread.  The greatest mistakes administrators make is confusing “offset” with “future credits” and other future claims, as well as confusing subrogation with exclusions. Read more

Shelby County Healthcare Corp, d/b/a Regional Medical Center v. The Majestic Star Casino, LLC group Health Benefit Plan, 2008 WL 782642 (WD Tenn.) has demonstrated that even though the SPD gives the Plan the final decision to accept or deny medical claims, discretion does not apply to the Plan’s TPA.Damon Weatherspoon, a plan participant of the Majestic Star Casino LLC Group Health Benefit Plan was involved in a single vehicle accident and sustained over $400,000 in medical expenses at the Regional Medical Center.  Reports indicated that Weatherspoon had violated Mississippi law by driving under the influence, driving without a valid Mississippi driver’s license and driving without insurance. Read more

The Supreme Court will be granting certiorari to MetLife, et al., v. Wanda Glenn.  While MetLife v. Glenn reinforces a third party administrator’s (”TPA”) right to make administrative decisions and interpret the terms of benefit plans when it is not the party funding the plan, this case asks whether a Plan Administrator faces a conflict of interest if it not only determines whether a claim is payable, but also pays the claim with its own funds. Read more

There is a recent newsworthy item that I wish to discuss, as it is pertinent to our industry.  The November 20, 2007 Wall Street Journal featured an extremely negative cover story, relating to the self-insured industry’s subrogation activities under ERISA.  These types of prominent news stories do nothing for the self-insured industry except motivate the public to change current ERISA legislation.  For those of you who do not know about this case, the story covers a woman’s collision with a semi-trailer truck seven years ago, leaving the 52-year-old Deborah Shank permanently brain-damaged and in a wheelchair. Her husband, Jim, received a $700,000 accident settlement from the trucking company involved. After legal fees and other expenses, the remaining $417,000 was put in a special trust to be used for Mrs. Shank’s care.  Read more

Recently, the Eastern District Court of Michigan held in Citizens Insurance Company of America v. Pitney Bowes Software Systems Employee Medical & Health Care Service Corp., 2007 WL 713144 (E.D. Mich 2007) that where the Plan document excluded claims covered by automotive insurance in its claim exclusions section, and asserted a right to coordinate benefits with the same types of insurance, these provisions were contradictory and cancelled each other out.   This is why The Phia Group matches exclusion language with coordination of benefits and subrogation language, and advises the use of language interpretation provisions as well. Read more

In Cheryl Street v. Ingalls Memorial Hospital, (2007 U.S. Dist. Lexis 18643), the Northern District Court of Illinois held on March 15, 2007 that just as a Plan must identify funds prior to seeking equitable relief in Federal Court, so too must relief sought by participants be specifically identifiable. In one case, decided by the Third Circuit Court of Appeals, a group of employee Plan Participants brought their Plan Administrator to court for handling their assets in an irresponsible manner. In Eichorn, et al. v. AT&T Corp., et al., 484 F.3d 644, (May 2, 2007), the Court held that while ERISA makes it illegal for a Plan Administrator to prevent the attainment of rights provided by the Plan, actions that lessen the value of the rights are not so prohibited. As such, in a case like this one, the only relief available was in the form of monetary awards and back pay, which is not “equitable relief” for purposes of Federal jurisdiction. Read more

In this case, an employee stopped working due to a medical condition and began receiving disability benefits from her employer’s self funded ERISA plan. After two years the case was reassessed, the TPA terminated the benefits. The insured filed suit against the TPA, seeking both payment of past claims and re-instatement of future benefits. The TPA moved to dismiss arguing that it was not a proper defendant in this case because it did not have any financial responsibility to the employee. The employer and plan, the TPA asserted, were the proper defendants. The court denied the motion to dismiss, however, stating that the TPA’s discretionary power over the payment of claims made it a fiduciary to the plan and plan members. Read more