ERISA Claims Recovery Services


What is recoupment?

Recoupment is the identification of insurance claims that were either denied or underpaid to the provider and overpaid and not reimbursed to the self funded employer. We help identify these claims and assist in the process of getting adjusted compensation back to the proper stakeholder.

Patient - The patient benefits because they have access to services that might otherwise be denied because their provider of chaoice may be out of network for example.

Provider - The provider is properly compensated for the services rendered regardless of network status which allows them to treat patients they might not otherwise treat.

Self funded employer - The Employer is sure to get reimbursed for claims volume they may be over paying the TPA/Insurance Plan for the claims they have adjudicated.

  • ERISA - improper recoupment hurts our doctors.
  • ERISA - improper recoupment hurts employers - when funds are not forwarded to plan.
  • ERISA - these improper activities hurts patients by increasing the cost of care.


 

What rules apply to employer-sponsored benefits under ERISA?

ERISA rules cover administration of the plan, some protections for enrollees and a few coverage requirements. In addition to COBRA and the HIPAA protections that apply to group health plans ERISA rules include:

 

  • Accountability - ERISA requires that a person or corporate entity administer the health plan in the best interests of the enrollees. ERISA sets standards for management of health plans and financial assets.
  • Written information - ERISA requires the employer-sponsored health plan to provide a written summary plan description to people covered by the health plan. It must describe covered benefits, enrollees' obligations under the plan (such as paying premiums or obtaining referrals), and how to appeal denied medical claims.
  • Claims procedures and internal appeals - Under ERISA, health plans must establish procedures for a timely and fair process for filing claims for health services. Health plans must provide enrollees with written notice if a medical claim is denied (including the specific reasons for the denial) and offer a full and fair review by the health plan - in other words, an internal appeal. The Department of Labor updated ERISA's requirements for claims and appeals procedures in 2002, generally shortening the time a health plan has to process claims and consider appeals when a claim is denied. For example, health plans must orally communicate their decision on claims and appeals for urgent care within 72 hours of receiving the claim.
  • Remedies and enforcement - ERISA permits enrollees to file a federal lawsuit against the insurer for failure to provide covered benefits or other violations of ERISA. If the lawsuit is successful, the enrollee can obtain coverage for the disputed benefit and reasonable attorney fees.

Unlike state benefit mandates, which can provide broad protections to consumers, ERISA sets few requirements for employer-sponsored health plans and only where the plan already covers the benefit. For example ERISA-governed health plans that pay for mastectomies must also pay for reconstructive breast surgery.

How does ERISA interact with state law?

In general, ERISA preempts (or trumps) state laws that regulate employer-sponsored health plans. If the ERISA-governed plan is fully insured, states laws may regulate the health plan the employer buys from an insurer, but states cannot directly regulate employers in the health benefits they offer. For example, ERISA restricts state laws' ability to mandate that employers offer health benefits and states cannot regulate self-funded employer-sponsored health plans.

However, ERISA does apply broad consumer protections to most group health plans.

How does the Affordable Care Act (ACA) affect ERISA?

The ACA amends ERISA by applying new protections to large group health plans and their insurers. These requirements include: 

  • coverage of preventive health services (for new plans but not grandfathered plans)
  • a ban on annual and lifetime limits
  • coverage for dependent children up to age 26
  • a ban on coverage rescissions
  • a ban on preexisting condition exclusions
  • guaranteed availability and renewability for fully-insured plans

In addition, ERISA-governed self-insured plans must implement an external review process, consistent with the Department of Health and Human Services regulation; however, this new requirement does not apply to grandfathered plans. 

The ACA does not affect ERISA's preemption provisions. In particular, ERISA plan enrollees are still limited to ERISA's remedies for lawsuits, which are generally less consumer-friendly than state rules, and states still do not have jurisdiction to regulate ERISA plans.

And this item:….

ERISA: Belatedly paying a claim during the lawsuit and mootness

By Mike Reilly on May 17th, 2011 Posted in ERISA

So you have an unwinnable lawsuit alleging wrongful denial of ERISA benefits. How do you stop the bleeding?

Paying the claim during the lawsuit may moot the claims and end it right there, even if plaintiff continues to seek attorney fees.

Here’s the decision of Templin v. Independence Blue Cross, (E. D. Pa. May 13, 2011) (no determination has been made as to publication). It shows what can happen when the ERISA plan decides to pay a claim during a pending lawsuit alleging wrongful denial of benefits.

Does payment of the claim render the lawsuit moot? Yes.

Does plaintiffs’ claim for attorney fees trump the mootness principle? Maybe not.

FACTS: Both plaintiffs were hemophiliacs covered under an ERISA health plan and they sought prescription benefits–payments for a blood medication. After defendants denied the benefit, plaintiffs sued and the Court ordered defendants to conduct an expedited administrative review. Following expedited review, defendants approved the claims. Defendants then moved to dismiss, contending the claims pending before the court were moot. Plaintiffs argued, however that mootness did not apply because plaintiffs’ attorney fees and costs had not been paid.

TRIAL COURT HELD: Defendants approved the claim during the pending lawsuit and therefore the claims are moot, even though plaintiffs’ continue to seek attorneys fees in the lawsuit.

RATIONALE:

  1. “Under traditional mootness principles, ‘[o]nce the defendant offers to satisfy the plaintiff’s entire demand, there is no dispute over which to litigate” and the payment ‘will generally moot the claim.” Op. at 10
  2. The case became moot once the disputed claims for benefits were paid. Id.
  3. “‘[A] request for [attorney] fees does not preserve a claim that otherwise has become moot.’” Op. at 11 (emph. added), citing Tannenbaum v. Unum Life Ins. Co, of Am., 2010 WL 2649875 at 6, n.14 (E.D. Pa, June 30, 2010) and Lewis v. Continental Bank Corp., 494 U.S. 472, 480 (1990)(a plaintiff’s “interest in attorney’s fees is …insufficient to create an Article III case or controversy where none exists on the merits of the underlying claim”). Op. at 11.
  4. Plaintiffs’ attorney fees incurred during the pre-litigation administrative process are not recoverable. “[T]his holding would apply to equal force to [attorney fees incurred during] administrative proceedings post-filing of the complaint in a case where plaintiff failed to exhaust administrative remedies before filing suit.” Op. at 11, n. 14.