Latest Entries

The Supreme Court held in MetLife vs. Glenn that conflicted interests require a higher standard of review whenever the claims adjudicator and the claims financier were the same.  Thus, any claim contested in court will confer a significant advantage to the arrangement where the claims are adjudicated by an independent third party and paid by an independent employer.  This means a disadvantage where the claims are both adjudicated and paid by the same two parties, such as employer’s self-administered and self-funded plan or fully insured plans. Read more

ERISA preempted an Illinois state law outlawing any claim on a workers’ compensation award, because the law related to benefits plans regulated by ERISA, a federal trial court decided. As a result, an employer may seek reimbursement of group health plan funds from workers’ compensation awards. The health plan paid the expenses before a determination was made that the claims were work related. The court determined that the settlements included reimbursement for health expenses that were paid by the plan. At least one of the awards was worded to assert that it was not a payment for health benefits, but the judge said that was an effort to stop a recovery attempt. Read more

In the case of Franciscan Skemp Healthcare, Inc. v. Central States Joint Board Health & Welfare Trust Fund No. 07-3456 (7th Cir.)(July 31, 2008), the Seventh Circuit Court of Appeals determined that when a party files a pure state law claim against an ERISA plan, preemption to Federal Court is improper. Read more

In the Commonwealth of Massachusetts, according to G.L. c. 90, §34A, auto insurers must provide their insureds with $8K personal injury protection (PIP).  In addition, insureds may purchase optional medical payments coverage (MPC) on top of the PIP.

The law also states that the auto insurer is only responsible to pay $2K of the $8K PIP towards medical expenses arising from an automobile accident when and if the insured has health insurance.  This rule was later clarified to mean only fully funded health insurers (coming within the purview of state law) are saddled with bills beyond the first $2K.  Self-funded plans coming within the purview of ERISA will only be responsible for medical expenses after the entire $8K mandatory PIP is exhausted. Read more

On Monday September 8, 2008, Adam V. Russo, Esq. will be presenting his seminar on self-funding benefits and the new legal battles under ERISA at the Texas Association of Benefit Administrators (TABA) 2008 Fall Conference & Exhibition held at the Marriott Dallas Solana Hotel in Westlake, Texas.

See the entire presentation before the conference

Please review the attached documents regarding a class action suit for which settlement has been proposed.  It addresses patients who were prescribed Paxil prior to their eighteenth birthday, for which you may have paid claims and may be due reimbursement.

Please review the information we have provided and determine if this affects you. 

The Providence Journal features a review by Mandy Twaddell, analyzing the new book by Peter Gosselin.  The book’s title is High Wire: The Precarious Financial Lives of American Families.  The book describes various pitfalls many American families experience today, and tells the tale of at least one encounter with ERISA. Read more

The Brualdi Law Firm, P.C. has issues a press release regarding suit they have filed against Lehman Brothers Holdings, Inc. for potential violations of ERISA.  The suit concerns Lehman Brother’s 401(k) plan, which comes within the purview of ERISA.  Brualdi, representing members of the Plan, assert that Lehman Brothers and other administrators of the Plan may have breached their fiduciary duties, owed to plan participants.  Such a breach may occur when fiduciaries fail to prudently manage plan assets. Read more

The United States District Court for the District of New Jersey, following a hearing on July 24, 2008, has approved a $250 million settlement in the matter of plan members versus Health Net, Inc.  Read more

The 7th Circuit Court of Appeals has just held in Pakovich v. Broadspire Services, Inc., that when a plan administrator fails to issue a benefits determination, and there is no administrative decision regarding a claim on record, the Court is not to make a decision in lieu of the administrator.  Instead, the case is remanded to the administrator, who must make a clear benefits determination decision.  Only after all administrative options are exhausted may either party to said decision appeal the decision to the Federal Courts under ERISA.

http://wislawjournal.com/article.cfm/2008/07/28/071520-Pakovich-v-Broadspire-Services-Inc Read more

Diamond Crystal Brands, Inc. v. Wallace, 531 F.Supp.2d 1366 (N.D. Ga.2008)

After the negligent medical care and consequential death of Deborah Hayes, the Estate and her daughter Tamara Hayes pursued a wrongful death claim against the hospital.  In Georgia State Court plaintiffs settled for $900,000, of which $837,000 went to Tamara Hayes and $63,000 to the Estate of Deborah Hayes.

Prior to Deborah Hayes’s death, her employer, Diamond Crystal provided $261,863.58 in medical benefits related to the medical malpractice.  After the settlement, Diamond Crystal sought reimbursement of claims paid. Read more

In the matter of Sgro v. Danone Waters of North America, Inc., 2008 U.S. App. LEXIS 13973 (9th Cir. Jul. 2, 2008), an employee - Mitchell Sgro - applied for benefits from his employer’s ERISA Plan.  He incurred $412.00 in copying fees, in the process of supplying documentation and medical records to his employer as part of his claim. Read more

You may have heard some grumbling about the recent case of Amschwand v. Spherion Corp., 2007 U.S. App. LEXIS 24435 (5th Cir. 2007).  The facts of the case are as follows:

Thomas Amschwand was a participant in his employer’s ERISA benefits plan, which included life insurance benefits.  The employer switched insurers after Thomas Amschwand was diagnosed with cancer. The new policy would not cover an employee unless and until that employee had worked one full day (post plan swap).  According to the Amschwand’s attorney, they were never advised of the requirement.  Unfortunately, Mr. Amschwand died without ever having worked a day after the employer had changed insurers. Read more

by Ron E. Peck, Esq.

The matter of administrative discretionary authority, when administering a health benefits plan within the purview of ERISA, and the deference federal courts must show to such discretion, has been the new hot topic in ERISA ever since subrogation rights were affirmed by the Sereboff case.  The Supreme Court first stated that health plan administrators, who assert discretionary authority to administer a plan within the plan’s document, are due deference in Firestone Tire and Rubber Co. v. Bruch.  Afterward, federal courts could overturn administrator benefit determinations only if they find that the administrator has abused its discretion (an arbitrary and capricious standard of review). Read more

As found in multiple cases in Oklahoma, an insured who quickly settles with a liable third party (tort-feasor) will eliminate any and all opportunities for its UIM carrier to subrogate or seek reimbursement for paid claims, against third party policy limits.  Read more