Wednesday, March 28 | 11:00 A.M. (EST)
Live 30-Minute Online Presentation Includes Interactive Q&A

Employers require Health Plan Documents containing clear language about available benefits that are compliant with the ERISA, PPACA, and other laws. PLAN DOC Builder™ by SRP simplifies the task of generating Plan Documents for Prescription, Dental, Vision, and Cafeteria benefits.

This webinar will demonstrate how this “web-based” tool can replace outdated software and the need for expensive outsourcing.

Webinar topics will include:

• The state of compliance
• Features and benefits of PLAN DOC Builder™ by SRP
• Fixed, affordable subscription pricing tiers
• Opportunities for TPAs, brokers, and other users

Register: https://www2.gotomeeting.com/register/777063618

© 2012 Strategic Recovery Partnership
Healthcare Subrogation Recovery | Plan Document Solutions
Call toll-free 855.557.5777 |  Email info@srpsubro.com

The US Airways’ self-funded plan paid out $66,866 in a case that settled for two policy amounts totaling $110,000. After attorney’s fees, McCutchen was left with $66,000. US Airways demanded 100% reimbursement and McCutcheon refused. The District court, relying on prior 3^rd Circuit cases (See Bollman Hat Co. v. Root, 112 F.3d 113 (3d Cir.1997) and Ryan v. Federal Express, 78 F.3d 123 (3rd Cir., 1996)) as well as the plan’s subrogation provision, found for US Airways in entirety.  McCutcheon appealed.  At issue with the 3^rd Circuit Court of Appeals was the meaning of “appropriate equitable relief” (29 U.S.C. 502(A) left open by Sereboff.  In reversing the District Court’s opinion, the panel found in its November, 2011 decision that it would be a windfall for US Airways to recover their entire lien without paying a share of attorney’s fees. The court reasoned that through the use of the term “appropriate equitable relief” Congress intended to allow the defenses typically available in equity, i.e., unjust enrichment. The case was remanded to the district court for a determination of how attorney’s fees should be apportioned.

Created specifically for the generation of Health Plan Documents including prescription, dental, vision and cafeteria plans, SRP’s Plan Doc Builder gives TPAs the flexibility to:

• Create or clone Health Plan Documents in an intuitive web interface
• Easily collaborate with experts to produce customized, attorney-approved Health Plan Documents
• “See as you go” by continuously reviewing and updating content during document preparation
• Generate easy-to-read and compliant Health Plan Documents and Summary Plan Descriptions with regulatory and benefit amendment capability

Thoroughly designed and developed, and a natural progression of SRP’s Plan Documents | PERFECTED service, the new Plan Doc Builder fully equips in-house users in both the self funded and fully insured industries and is available at fixed licensing rates with no initial subscription fee. Users of Plan Doc Builder also can access online feedback to technical and legal questions from SRP. With nearly 20 years of experience in the health subrogation and recovery industry, SRP has in-depth expertise with TPA claim and benefit practices, technical writing, plan consulting and ERISA.

Become an SRP Subrogation client and receive your license at no cost

See how we compare!

Schedule  a personal demonstration
Request  a quote for affordable licensing rates
Speak to a Plan Document Specialist: 855 .557.5777
Learn more about SRP’s Plan Doc Builder

Contact Robert A. Marcino, Esq. at rmarcino@srpsubro.com for more information. If you are currently managing recoveries in-house or working with another vendor, ask yourself these questions:

• What percentage of completed accident questionnaires are opened as a potential
  recovery case versus not?
• How many new “potential” cases are identified each month?  And of those, how many actually result in a recovery within 18 months?
• How many “closed without recovery” cases do you record each month or in a given year?
• What is the ratio of open / active inventory dollars versus dollars recovered on a monthly basis?
• At what percentage of the lien are the actual recovery cases being settled?
• What is the ratio of open, or active, cases where the plan member is represented by an
  attorney to those where the member is not?
• How many open, or active, cases where the member is not represented by an attorney
  have been open for greater than one year?
• Are you very aware of the number of active and closed cases and recoveries being made?
  If so, through what methods?
• Does your subrogation firm track the policy limits available in your cases?
• What contingent fees are you paying to your current subrogation vendor?
• What revenue are you, the claim payor, earning on recoveries?

SRP offers a $1,000 payment to any TPA for answering this list of questions. Contact us to qualify.

Never events, and the associated bills, are handled differently depending upon the payor.  In 2008, CMS announced that they would not make payment for any of them.  In 2009, they went further and recommended that state Medicaid agencies follow the same rule.  Health insurance carriers have also attempted to institute the same restrictions through announced policies and began working the excluded never events into their provider contacts as a way to prevent the plan participant from being left holding the bag.  It comes as no surprise that patients were left with balance bills.

In the self-insured ERISA world, stop loss carriers have taken up the charge by informing their health plans that they simply will not provide reimbursement for never events.  However, unless the self-insured plan specifically excludes the events, the plan may be left responsible for payment.  And if the self-insured plan does in fact exclude the events, the member may be faced with unpaid bills.  It’s not as if a plan can advise their membership not to undergo such treatments as they are unplanned.  In the end, as is the case with anything that is not covered, the plan member may be responsible for payment and/or left with a fight against its Provider, including one for malpractice.

The case involved a $64,000 lien where only a policy limit of $100,000 was available.  As is typical in WI, the Plan was named as a defendant.  The member argued that they were not Made Whole – not fully compensated for their injuries by the $100,000 settlement.  The Plan cross claimed arguing that Made Whole did not apply, citing their plan language that rejected application of the Made Whole Doctrine.  There were other issues in the case, including whether the entire lien was actually related to the accident.

The Trial Court agreed with the Plan that Made Whole did not apply and in effect gave the Plan the benefit of the doubt that the entire lien was in fact related because it did effect a settlement.  The Appeals Court, however, reversed the trial Court and ruled that the Plan must prove relatedness because the Plan did not contain a provision allowing it to recover for benefits not related.

Finally, the WI Supreme Court settled the issue and found in favor of the Plan agreeing that the Plan’s determination of relatedness was not unreasonable.  The Court further ruled that Made Whole did not apply because the language in the Plan specifically called for reimbursement regardless of whether the member was made whole.

What does this mean? It means that one, questionnaires are only part of the solution.  Data matching against existing databases of liability claims is equally important and has to be done to ensure maximum case identification. And two, that the contingent fees paid to a subrogation vendor touting their superior ability to send questionnaires aren’t justified by the actual results. This is especially true for Third Party Administrators who want to earn revenue on recoveries.

Do we send accident questionnaires? For clients who either cannot or do not want to perform that function, of course. But we also back up that process with state of the art data matching to identify cases where members have actually filed a claim against someone, whether they are represented by an attorney or not—and whether they have filed suit or not. And best of all, the process neither requires or relies upon plan member response. The end focus is where it should be: generating recoveries at the lowest cost and maximizing revenue on those recoveries for the claim payor.

View SRP’s Data Mining Questionnaire

Questions you should ask yourself or your subrogation vendor.
Your answers will earn $1,000—No Red Tape!

It depends.  Even though you may have received, or produced, what looks like an SPD, calling it an SPD doesn’t necessarily mean it is one.

ERISA (and the regulations issued thereunder) describes the information that must be included in welfare plan SPDs.  If a plan is fully insured, an off-the-shelf document produced by a vendor, or the certificate of coverage (COC) provided by a carrier, may not have all of the legally required language. If your plan is fully insured, the booklet you receive is usually the summary created by the insurer for filing with insurance boards of the states in which the benefit is offered.  It is typically written to satisfy a particular state’s licensing requirements.  Often it even includes additional language – and sometimes technical amendments  – that do not even need to be in a SPD.  Booklets are not typically designed for a specific company either, nor are they easily formatted to match a specific company’s communication style and terminology. Some booklets may include applicable “ERISA” language and may technically be used as an SPD (assuming all other required information is included), but in the end that booklet forces members  to sort through insurance information that doesn’t affect them.

A better alternative than a booklet is to create a compliant, user-friendly SPD that is easy to follow and customized for a particular Plan. TPA’s are then left with comprehensive documents upon which to administer, Plans are up to date and compliant with healthcare reform, and employees and their dependents will appreciate the value of Plan benefits clearly conveyed.

Contact SRP for more information.

For calendar year plans, this means that important decisions regarding plan changes need to be made before their January 1, 2011 effective date.  Although health care plans may implement required changes sooner, most employers are taking a “wait and see” approach, choosing only to implement changes as of the mandated effective date over the next several years.  Additionally, plan sponsors are faced with the pressing decision of whether to adopt “grandfather status” in order to delay implementation of non-essential benefits under PPACA.  What to do?

Interim rules recently issued by the Departments of Health and Human Services, Labor, and Treasury provide the administrative steps a plan must take to maintain grandfather status.  Plans in existence on the date of PPACA’s enactment on March 23, 2010 may elect to be exempt from certain market reform provisions of the Act, provided they do not make certain plan changes.  But plans are not exempt from other requirements such as annual and lifetime limits, dependent coverage to age 26, waiting periods, and tax provisions, as well as several other provisions.

In addition to the communication requirements included in the Act, all ERISA plans must continue to comply with existing disclosure requirements.  On one hand, communicating upcoming changes may represent a challenge to plan sponsors and create some confusion with plan participants.  On the other, with an appropriate strategy, plan communications ahead of time can be used to deliver a cohesive message that reinforces the value of employees’ overall benefits package.

Communicating Grandfathered Status

For plans adopting grandfathered status, additional content must be included with benefit materials distributed to participants.   Although the effective date and time frame for issuing this statement has not yet been determined, it more than likely will be needed beginning with plans years on or after September 23, 2010.

Grandfathered plans will need to maintain plan documents necessary for participants to verify its ongoing status.  The new notice must include a statement that the plan “believes” it is a grandfathered plan and that participants will not be covered by some consumer protections offered under PPACA.  It must also include plan and Department of Labor (for ERISA plans) contact information for participant questions and/or complaints. The interim rules indicate that this notice will need to be included in the plan document and can also be included in the SPD to satisfy disclosure requirements.  However, if the plan rescinds its grandfathered status in future years, participants would need to be notified of the subsequent change.

While the notice to elect grandfathered status may not be received by employees as positively as other plan changes, providing an explanation as to why this decision was made may help to minimize any negative reactions.

Keep in mind that for plan years beginning on or after January 1, 2011, additional changes being phased in under PPACA will need to be communicated in the same manner to participants.  So, developing a communications strategy sooner rather than later can help you to provide a clear and consistent approach for communicating changes while still complying with disclosure requirements.

Communicating Plan Changes

The Summary Plan Description (SPD) is the primary source used by most companies for describing plan benefits.   A user-friendly SPD, written in simple, easy-to-understand language, can incorporate strategic messages that emphasize the value of their benefits.  The SPD is required to be provided to participants within 90 days of their first becoming covered by the plan.  An updated SPD must be furnished every 5 years if plan changes have been made or if other information in the SPD needs updated.  Otherwise, the SPD must be reissued every 10 years.

During the 5-year cycle, changes in the SPD can be communicated by either issuing a new SPD or by issuing a Summary of Material Modification or a Summary of Material Reduction in Covered Services/Benefits, depending on the change.  An SMM is used to communicate changes to plan benefits or the SPD.  The SMM must be issued to all covered participants no later than 210 days following the plan year in which the change is adopted.

A SMR is used to communicate any “material reduction in benefits or services.”  It must be sent to all covered participants within 60 days of adoption of the material reduction.

Both the SMM and SMR revise the SPD until a new one is issued and must be included with any SPD issued thereafter to new participants.  There is no standard format or required language for an SMM or SMR, so a summary of changes that also conveys the value of benefits can easily be developed.

Depending on your plan changes, you have several choices for communicating upcoming plan changes, all which should include your desired message:

• Include future changes in the current SPD and simply state future effective dates.  If you are in the process of updating your SPD, it can easily be drafted to include changes that will take effect on a future date (e.g., Effective January 1, 2011, the maximum plan limit shown will be eliminated.)  This allows the current plan design to be correctly explained in the SPD while alerting participants to a future change.
• Send an SMM or SMR to all covered participants once the final plan design is determined.  Since most of the changes required under PPACA do not constitute a reduction in benefits or services, an SMM will be the appropriate form of communicating changes.  Including a summary of the changes in your open enrollment materials, along with your key messages, can serve as the formal SMM.  This document will need to be included with all future SPDs until the SPD is updated to incorporate the changes.
• Issue a new SPD with the plan changes incorporated or issue newly updated pages for the current SPD that reflect plan changes.

In addition to the above materials, plans will need to develop a new Uniform Summary of Benefits (USB) to be distributed to participants no later than March 23, 2012. This disclosure is required in addition to the SPD. Material modifications made after the USB is provided will also need to be communicated at least 60 days prior to the modification’s effective date. The Secretary of Health and Human Services is charged with developing content and language requirements by March 23, 2011. So, stay tuned on that front, but beware of fines imposed for failure to provide the notice.

Contact SRP for more information.