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ERISAclaim.com

September 23, 2009

ERISA Appeal Fact Sheet

Can Or Should PPO Providers Conduct ERISA Appeals or Lawsuits?

Maximum Reimbursement through Compliance with ERISA Appeals

      It has come to our attention that there has been a lot of confusion among health care reimbursement professionals and industry leaders as to whether a PPO provider can or should file ERISA appeals or ERISA lawsuits if necessary after participating PPO's or HMO's, especially after recent class-action lawsuit between Blue Cross Blue Shield Association plans,  managed-care networks and healthcare providers.

      The answer to the questions above is "Yes", in accordance with every managed-care contract and public policy, federal laws.

         As a matter of fact and as a matter of law, it has been repeatedly clarified, certified and agreed upon,  for all managed care contracts, PPO or HMO,  by insurance and benefits industry or managed-care third-party payers, for all managed-care network contracting,  participating providers, PPO or HMO, and in PPO/HMO contracting/participating agreement and class-action settlement legally approved by federal courts that NOTHING contained in any PPO/HMO contracting agreement or PPO/HMO class action settlement "is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Plan Member under § 502(a) of ERISA or to supersede in any respect the claims procedures for Plan Members of § 503 of ERISA, or required by applicable state or federal law or regulation."

        Any PPO/HMO contracting will be against public policy, federal law (ERISA), and thus will be non-enforceable if anything contained in any PPO/HMO contracting agreement or PPO/HMO class action settlement "is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Plan Member under § 502(a) of ERISA or to supersede in any respect the claims procedures for Plan Members of § 503 of ERISA, or required by applicable state or federal law or regulation".

         It will be a criminal violation of Federal law, 29 USC §1141, if any managed-care contracting, PPO/HMO, or any individual to fraudulently interfere with ERISA rights through managed care contracting by using deception and misrepresentation that PPO/HMO contracting will  supersede, limit or otherwise alter ERISA rights or remedies otherwise available to any Plan Member and his/her authorized representative (DOL ERISA FAQ B3) under § 502(a) of ERISA or will supersede in any respect the claims procedures for Plan Members of § 503 of ERISA because under Federal law, 29 USC §1141, "It shall be unlawful for any person through the use of fraud, force, violence, or threat of the use of force or violence, to restrain, coerce, intimidate, or attempt to restrain, coerce, or intimidate any participant or beneficiary for the purpose of interfering with or preventing the exercise of any right to which he is or may become entitled under the plan."

Why & How???

1. As illustrated in federal court repeatedly, all PPO or HMO ERISA plan payers clearly asserted and clarified that ERISA plan provisions, Summary Plan Description (SPD) govern or control plan coverage or benefits, limitations or exclusions while PPO or HMO contract determines provider's contracting discount, and

2. As the final clarification for all PPO and managed-care contracting in all PPO/HMO class-action settlement in the federal court, every payer clarified and agreed that nothing contained in any managed-care contract is intended to supersede, limit or alter ERISA rights, and

3. In U.S. Supreme Court, entire managed-care industry argued that healthcare provider should file ERISA appeals and exhaust ERISA appeal remedies before filing any lawsuit and ERISA completely (100%) preempts and supersedes or validates any and all state laws and managed care contracts governed under state laws for any causes of action (lawsuit) brought to remedy only denial of benefits from ERISA plans ( provider medical bills);

4. Almost every Medical Policy contained in the managed-care contract in USA, PPO or HMO, specifically contained a legal disclaimer that those medical policies were intended for educational and general reference purposes but each individual patient ERISA plan SPD's determines plan benefits coverage, limitations and exclusions, and ironically, on almost every payer's website, a provider or a reader must acknowledge and agree to this ERISA rights warning before one can even read any medical policies on the website which were automatically incorporated into every managed-care contract, and every provider who read these online medical policies simply clicked "I agree" then immediately forgot all completely that ERISA legal disclaimer that ERISA and SPD supersedes, invalidates and preempts any and all managed-care contract, PPO or HMO for each member's plan benefits coverage, limitation and exclusions;

5. As required by federal law, ERISA, almost every EOB (Explanation of Benefits) from every ERISA plan payers notified healthcare providers that if you disagree with claim denials, you have a right under ERISA to file ERISA appeals. Ironically this ERISA EOB practice has been in existence for 34 years since 1974 when ERISA was enacted by Congress, now for an estimated of 170 million working Americans and their families covered under ERISA, and for more than 80% of non-Medicare claims, which was completely ignored hundreds of trillion times by healthcare providers and healthcare industry for 34 years, worse than allegedly known warnings for 9/11 disaster in US history;

6. Also importantly, as required by federal law ERISA,  every ERISA plan EOB (Explanation of Benefits, Benefits Notification) must contain and notify the provider and patient that if you disagree with ERISA plan's review decision, you have a right to file lawsuit in federal court under ERISA. A failure by an ERISA plan to issue ERISA compliant benefits notification with ERISA right to sue in federal court will be considered as a violation of Federal law, ERISA and a breach of ERISA fiduciary duties. Therefore it is the ERISA plan's legal duty to notify patient and provider of ERISA right to sue, ERISA rights to appeal and to sue (ERISA Miranda's Right) are statutory rights, such as Miranda's Right well known to everyone, or "As Seen on TV", in criminal proceedings, rather than a PPO contract breach, hostility from a provider or patient for filing ERISA lawsuit, or bad attitude or agonizing payers when participating PPO or HMO networks. ERISA Miranda's Right must be as same well known and well practiced in healthcare industry as criminal Miranda's Right "As Seen on TV" in every American household;

7. Regardless with or without PPO and HMO managed care contracting or participation, it is a criminal violation of ERISA under federal law, 29 USC §1141 for anyone to fraudulently interfere with ERISA rights by using deceptions and misrepresentation from and by managed care contracting, PPO or HMO, as 29 USC §1141 states: "It shall be unlawful for any person through the use of fraud, force, violence, or threat of the use of force or violence, to restrain, coerce, intimidate, or attempt to restrain, coerce, or intimidate any participant or beneficiary for the purpose of interfering with or preventing the exercise of any right to which he is or may become entitled under the plan,........For example, Section 1141 would reach the use of deception directed at misleading a welfare plan beneficiary as to the amount of health benefits owed to the beneficiary under the terms of the plan"

      In accordance with US Supreme Court ruling in Aetna v. Davila and insurance and benefits industry argument and advocacy as well as every managed-care contract, PPO or HMO, every healthcare provider or patient must file ERISA appeals before ERISA lawsuit if necessary or inevitable for reimbursement or remedy denial of benefits from an ERISA plan, not only self-insured but also fully-insured plan sponsored by employers in private sector.

     Failure to file ERISA appeals by a provider or patient is an act of noncompliance with federal law, or a voluntary surrender to wrongful denials for the benefit otherwise a patient may be legally entitled to under the plan provisions and federal laws.

      Failure by an ERISA plan to offer an opportunity to the claimant to seek full ERISA full and fair reviews is a violation of public policy, ERISA, and a breach of fiduciary duties under the plan. Any intentional deception or misrepresentation by anyone to interfere with ERISA right to appeal by a claimant or his/her authorized representative is a criminal violation of federal law, 29 USC §1141.

      As illustrated in federal court repeatedly, all PPO or HMO ERISA plan payers clearly asserted and clarified that ERISA plan provisions, Summary Plan Description (SPD) govern or control plan coverage or benefits, limitations or exclusions while PPO or HMO contract determines provider's contracting discount

      EVERY MANAGED CARE CONTRACT IS SUBJECT TO ERISA AND PLAN SPD FOR REIMBURSEMENT FROM AN ERISA PLAN.

      After faithfully committing 0r marrying to PPO agreement fantasy for decades by hospitals, as everyone else conveniently and solacely have done,  Blue Cross of California told the federal court and the hospital that ERISA governs and regulates hospital's money dispute with lovely PPO agreement, ERISA plan SPD rather than PPO contract determines the plan coverage, limits and exclusions, and all of the PPO provider grievance procedures under state laws are completely preempted by ERISA. A lifetime surprise to "die hard PPO" hospitals, from which, hospitals and health-care providers have learned nothing so far nationwide because sadly and disastrously, healthcare providers have been hopelessly overdosed under managed-care contracting Viagra, and PPO or HMO Prozac.

      The following is how managed-care Viagra with PPO or HMO Prozac played out in the federal court the reality:

SMS Fresno Community Hospital and Medical Center

v.

John Souza

 

EASTERN DISTRICT OF CALIFORNIA

July 3, 2007

 

“ALLEGATIONS AND CAUSES OF ACTION

 

According to the complaint, UMC entered into a contract with Blue Cross of California (the “Blue Cross Contract”) pursuant to which it agreed to provide medically necessary services, equipment and supplies to individual enrollees of health plans registered with Blue Cross as “Payor” signatories to the Blue Cross Contract. Teamsters was a Payor signatory to the Blue Cross Contract. In exchange, Teamsters agreed to pay UMC for the medically necessary services, equipment and supplies rendered to the individual enrollees in Teamsters’ health plan. The negotiated rates under the Blue Cross Contract provided for such services to be paid at a ten percent discount. UMC agreed to submit bills to Teamsters and/or Teamsters’ agent reflecting the ordinary total billed charges for services rendered to the individual enrollees of Teamsters’ health plan on a claim form, and Teamsters would then process and pay each claim at the ten percent discounted rate. Complaint, ¶¶ 9-12. Delta Health Systems was the third party administrator for the Teamsters’ plan.”

 

“The complaint alleges that Teamsters failed to pay for medical treatment provided to two patients enrolled in Teamsters’ health plan. UMC alleges that Teamsters verified that these patients were enrolled in their health plan yet failed to pay the final bills. After application of the discount, UMC alleges that it is owed a total of $38,952.93 ($43,281.03 prior to discount).”

 

"UMC alleges causes of action for breach of contract, quantum meruit and negligent misrepresentation against Teamsters. It alleges intentional interference with contractual relations against Delta Health Systems based on the allegation that Delta convinced Teamsters to withhold payment on the pretext that they could do so pending the completion and delivery of certain forms."

 

"In PERALTA V HISPANIC BUSINESS, The Ninth Circuit has explained that common law claims do not “relate to” an ERISA plan when:

1. “the “adjudication of the claim required no interpretation of the plan”,

2. “no distribution of benefits”, and

3. “no dispute regarding any benefits previously paid”.

 

"Section 6.14 of the Blue Cross Contract provides as follows:

 

BLUE CROSS agrees to verify to HOSPITAL a person's BLUE CROSS  membership and to identify for HOSPITAL, based upon information provided by HOSPITAL, waivered conditions, current balance of lifetime maximum and any dollar limits applicable under the relevant Benefit Agreement. . . . A guarantee of eligibility is not a guarantee of payment. If HOSPITAL is notified that the member is eligible, HOSPITAL is entitled to payments for services rendered, covered under, and subject to the exclusions and limitations of the relevant Benefit Agreement.”

      [Benefit Agreement = Summary Plan Description, SPD - by ERISAclaim.com]

“CONCLUSION

Based on the above, the Court finds that the First, Second and Third Causes of Action are preempted by ERISA. UMC’s motion to remand is therefore DENIED.”

      PPO Contract with Insurance Verification and Precertification = PPO or ERISA? = ERISA!

      As the final clarification for all PPO and managed-care contracting in all PPO/HMO class-action settlement in the federal court, every payer clarified and agreed that nothing contained in any managed-care contract is intended to supersede, limit or alter ERISA rights

      EVERY MANAGED-CARE CONTRACT DISPUTE, CLASS-ACTION LAWSUIT, SETTLED WITH CONCLUSION THAT ERISA AND SPD CONTROL YOUR PPO.

      PPO Agreement Doesn't Prohibit or Interfere with ERISA Appeals

      It is very important legally for healthcare providers and industry executives as well as reimbursement professionals to understand that ERISA appeal doesn't breach any PPO agreement with any payers, and as a matter of fact, almost every payers have clarified and declared in the class action settlement for the payer's PPO agreement in relationship to ERISA, that NOTHING contained in any PPO/HMO agreement or PPO/HMO class action settlement "is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Plan Member under § 502(a) of ERISA or to supersede in any respect the claims procedures for Plan Members of § 503 of ERISA, or required by applicable state or federal law or regulation." This was clearly stated in all BCBS Association's class-action settlement agreement approved by federal court on June 12, 2009 on PAGE 40, 41 of page 103 captioned below and with identical phrases in almost every other class action settlement with other payors, such as Aetna, Cigna, UHC and Humana.....

      On June 12, 2009, All BCBS plans have told all providers and the federal court that PPO doesn't supersede, alter or limit ERISA rights in class action settlement.

      Also, on the other hand, many providers erroneously believed that since they have signed class action settlement with payers, they can not do ERISA appeals, or they will be in breach of their settlement agreement and PPO agreement, thus, antagonizing payers in the PPO relationship.

      As a matter of fact, the truth is exactly opposite:

      In the most recent class-action settlement on June 12, 2009 between Blue Cross Blue Shield Association and healthcare providers, Blue Cross Blue Shield settlement agreement reiterated that PPO agreement never has and never will supersede, alter or limit ERISA rights for any patients and healthcare providers while most of the other provisions in the Blue Cross Blue Shield Association Settlement Agreement have already taken into effect. These include, but are not limited to, a prohibition on collecting an alleged overpayment beyond 18 months (or less if a lesser period is specified by state law), 90 days’ advance notice of material adverse changes, and application of a clinical based definition of medical necessity.

      Simply put:

      BCBSA June 2009 Settlement means:

1. § 7.10, (b), PPO doesn't kill/prohibit ERISA, PPO is not ERISA

 

2. § 7.10, (d) ERISA lawsuit is OK, even by PPO doc's (DOL ERISA FAQ B3), but if ERISA by Pt or Doc, PPO suit should be stopped;

 

3. § 7.10, (e) Nothing in BCBS all MCO agreements and settlements, HMO/PPO,  "to supersede, alter or limit the" ERISA.

      So, the provider ERISA appeal is OK with all BCBS settlement,

      As a matter of fact, all of the traditional provider appeals or lawsuits here are MCO, PPO/HMO provider contract suit, not ERISA benefits appeals or lawsuit.

      As agreed in this BCBSA settlement agreement on PAGE 40, 41 of page 103:

"7.10 New Dispute Resolution Process for Physician Billing Disputes
.....

 

"(b) Nothing contained in this § 7.10 is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Plan Member under § 502(a) of ERISA or to supersede in any respect the claims procedures for Plan Members of § 503 of ERISA, or required by applicable state or federal law or regulation. In the case of: (i) a state or federal law that requires the Blue Plan and Physician to use an external billing dispute review process, (ii) a state or federal law that requires the Blue Plan to establish and make available an external review process, and such process provides at least substantially the same procedural protections and rights as the process set forth in this § 7.10, and is a process that provides for disputes to be resolved at a cost to the Physicians that is not substantially greater than the cost set forth in this § 7.10 in time frames not materially longer than the time frames set forth in this § 7.10 and that any determinations are rendered by an independent, external person or entity, or (iii) an external review process that is established by a state or federal governmental body that the Blue Plan is required to make available and such process provides at least substantially the same procedural protection and rights as the process set forth in this § 7.10, only the program described in subclauses (i)-(iii) shall be utilized for Billing Disputes with respect to Plan Members covered by such process. Notwithstanding the foregoing, if there is any state or federal external review process that does not meet the requirements for use set forth herein, but is otherwise available to a Physician or Physician Group, the Physician or Physician Group shall be limited to bringing an appeal either under the process set forth in this § 7.10 or the available state or federal process, but not both."

 

(D) The Blue Plan’s Plan Member (or his or her representative) has filed suit under § 502(a) of ERISA or other suit for the denial of health care services or supplies regarding an Adverse Determination. In that event, or if such a suit is subsequently initiated, the Plan Member’s lawsuit shall go forward and the Physician’s claims shall be dismissed and may not be brought by or on behalf of the Physician in any forum; provided that such dismissal shall be without prejudice to any Physician seeking to establish that the rights sought to be vindicated in such lawsuit belong to such Physician and not to such Blue Plan’s Plan Member.

(E) Nothing contained in this § 7.11 is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Person under § 502(a) of ERISA or to supersede in any respect the claims procedures under § 503 of ERISA." (Settlement Agreement)

http://www.hmosettlements.com/settlements/bluecross/Thomas%20-%20Amended%20Settlement%20Agreement%20_Joinder%20of%20IBC_.pdf

http://www.hmosettlements.com/pages/bluecross.html

      Blue Cross Blue Shield Court Orders and Settlement Agreement Documents (hmosettlements.com)

      Now we can evaluate class-action settlement from Aetna and CIGNA in the past several years. Please note that the settlement provisions on ERISA and PPO are almost identical for every payers.

AETNA SETTLEMENT AGREEMENT (pdf, 97 pages), dated as of May 21, 2003 by and among AETNA INC., THE REPRESENTATIVE PLAINTIFFS, THE SIGNATORY MEDICAL SOCIETIES AND CLASS COUNSEL

"7.10. New Dispute Resolution Process for Physician Billing Disputes.

a."......Nothing contained in this § 7.10 is intended, or shall be construed, to supercede, alter or limit the rights or remedies otherwise available to any Person under § 502(a) of ERISA or to supercede in any respect the claims procedures of § 503 of ERISA." [page 25]

7.11. Medical Necessity External Review Process.

"(c) Notwithstanding the provisions of § 7.11(a), Physicians
may not seek review of any claim for which the Plan Member (or his or her representative) has filed suit under § 502(a) of ERISA. In that event, or if such a suit is subsequently initiated, the Plan Member’s lawsuit shall go forward and the Physician’s claims shall be dismissed and may not be brought by or on behalf of the Physician in any forum; provided that such dismissal shall be without prejudice to any Physician seeking to establish that the rights sought to be vindicated in such lawsuit belong to such Physician and not to such Plan Member.

(d) Nothing contained in this § 7.11 is intended, or shall be construed, to supercede, alter or limit the rights or remedies otherwise available to any Person under § 502(a) of ERISA or to supersede in any respect the claims procedures under § 503 of ERISA.

e. Company shall maintain an internal appeals process for medical necessity denials and shall disclose such process on the Public Website. Company shall adjudicate all such appeals of medical necessity denials on the timeframes that are applicable to Plans subject to ERISA, regardless of whether such Plans are actually subject to ERISA......." [page 30]

Aetna Settlement Claim Form (pdf)

CIGNA SETTLEMENT (pdf, 150 pages ) (doc)

"7.10 Dispute Resolution Process for Physician Billing Disputes.

a. CIGNA HealthCare shall implement an independent, external billing dispute review process (the “Billing Dispute External Review Process”) for resolving disputes with Class Members concerning the application of CIGNA HealthCare’s coding and payment rules and methodologies to (i) patient specific factual situations, including without limitation the appropriate payment amount when two or more CPT® Codes are billed together, or whether the Class Member’s use of modifiers is appropriate, or (ii) any Retained Claims, so long as such Retained Claims are submitted by the Physician to the Billing Dispute External Review Process prior to the later to occur of either ninety (90) days after Final Approval or thirty (30) days after exhaustion of CIGNA HealthCare’s internal appeals process. Each such matter shall be a “Billing Dispute.” The Reviewer (as defined below) shall not have jurisdiction over any disputes that are not patient specific application of Claim Coding and Bundling Edits, including without limitation those disputes that fall within the scope of the Medical Necessity External Review Process set forth in Section 7.11 of this Agreement, disputes about the submission of Clinical Information that fall within the scope of Section 7.12, Compliance Disputes and disputes concerning the scope of Covered Services. Nothing contained in this Section 7.10 is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Person under § 502(a) of ERISA or to supersede in any respect the claims procedures of § 503 of ERISA.

"(3)       Time Limits for Completing Internal Appeals.

All internal appeals shall be completed within the time limits required by regulations  issued by the Department of Labor, even those internal appeals for which ERISA is not applicable. [page 50]

(3) Notwithstanding the provisions of this Section 7.11, Class Members may not seek review of any claim for which the CIGNA HealthCare Member (or his or her representative) has filed suit under § 502(a) of ERISA or other suit for the denial of health care services or supplies on Medical Necessity grounds. In that event, or if such a suit is subsequently initiated, the CIGNA HealthCare Member’s lawsuit shall go forward and the Class Member’s claims shall be dismissed and may not be brought by or on behalf of the Class Member in any forum; provided that such dismissal shall be without prejudice to any Class Member seeking to establish that the rights sought to be vindicated in such lawsuit belong to such Class Member and not to such CIGNA HealthCare Member. [page 52]

"(4)       Nothing contained in this Section 7.11 is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Person under § 502(a) of ERISA or to supersede in any respect the claims procedures under § 503 of ERISA." [page 53] 

Anti-balance Billing Instruction to Non-participating Physicians (page 80-81)

"p. Participating Physician Status Dependent Upon Existence of Contracts; Limitations on Obligations of Non-Participating Physician.

CIGNA HealthCare agrees that it will treat a Class Member as a Participating Physician only in those circumstances in which the Class Member is a party to a written contract with CIGNA HealthCare or with an intermediary with which CIGNA HealthCare has a written contract. CIGNA HealthCare further agrees that at least through the Termination Date, it will not rent its networks to any other managed care company or health insurer for the purpose of providing health care services or supplies to any person who is not a CIGNA HealthCare Member; provided that nothing in this sentence shall prevent CIGNA HealthCare from making its networks available among the various current and future Subsidiaries of CIGNA Corporation; and provided, further, that nothing in this sentence shall be held to apply to a situation in which a CIGNA HealthCare customer elects to make payments on claims in respect to provisions of health care services or supplies to a CIGNA HealthCare Member through a third party administrator or where CIGNA Behavioral Health provides mental health services for another health insurance company or other entity. No affirmative obligation that this Section 7 imposes on a Participating Physician shall apply to Non-Participating Physicians unless and until, and then only to the extent that, with regard to each individual claim, such Non-Participating Physician submits or transmits to CIGNA HealthCare a claim for payment which designates therein that the Non-Participating Physician has accepted an Assignment of the CIGNA HealthCare Member’s benefits as payment for that individual claim.

q. Effect of Assignment of Benefits.

The existence of an Assignment of Benefits authorization, whether or not submitted by the Non-Participating Physician to CIGNA HealthCare, does not constitute in and of itself full or partial payment of the Non-Participating Physician’s fee (unless so agreed between the Non-Participating Physician and the CIGNA HealthCare Member), does not create an implied contract between the Non-Participating Physician and CIGNA HealthCare, and does not limit the Non-Participating Physician’s fee to any fee schedule. The Non-Participating Physician retains the right to elect either to collect the Non-Participating Physician’s full fee from the CIGNA HealthCare Member or collect partial payment from CIGNA HealthCare and the balance from the CIGNA HealthCare Member (“balance bill”)."

      In U.S. Supreme Court for Aetna v. Davila, entire managed-care industry argued that healthcare provider must file ERISA appeals and exhaust ERISA appeal remedies before filing any lawsuit in federal court and ERISA completely (100%) preempts and supersedes or validates any and all state laws and managed care contracts governed under state laws for any causes of action (lawsuit) brought to remedy only denial of benefits from ERISA plans ( provider medical bills);

      In accordance with United States Supreme Court unanimously ruling in ERISA judicial appeals, Aetna v. Davila, 06/21/2004, any appeal and lawsuit seeking for benefits payment from an ERISA plan falls completely (100%) within the scope of the ERISA, and all state laws are completely (100%) preempted, invalidated and superseded by ERISA.

Aetna v. Davila, U.S. Supreme Court

      "We hold that respondents’ causes of action, brought to remedy only the denial of benefits under ERISA-regulated benefit plans, fall within the scope of, and are completely pre-empted by, ERISA §502(a)(1)(B), and thus removable to federal district court. The judgment of the Court of Appeals is reversed, and the cases are remanded for further proceedings consistent with this opinion. It is so ordered."    Aetna v. Davila, U.S. Supreme Court

 <http://www.law.cornell.edu/supct/html/02-1845.ZS.html>

      Immediately after Supreme Court ruling in Davila on June 21, 2004, American Benefits Council promoted advocacy for ERISA appeals by health care providers. “The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans”.

      NEWS RELEASE (June 21,2004): Supreme Court Ruling on Health Care Claims Raises Important Policy Issues: American Benefits Council Responds to Critics of Today's Davila, Calad Rulings:

"These review procedures are available under ERISA to help patients get the care they deserve, quickly and without having to resort to costly and lengthy legal procedures. Clearly, a speedy and factual review aided by the expertise of the physicians involved with these two cases could have avoided the need for the courts to be involved at all," Klein said.

 

"ERISA is intended to protection patients, not enrich plaintiffs' attorneys. If the objective is to ensure healthy and safe outcomes for patients, then certainly efficient review of claims disputes under ERISA, not inviting litigation, is the way to go," Klein added.”  (Emphasis added) 

 http://www.americanbenefitscouncil.org/newsroom/pr04-32.cfm

      Therefore, as a matter of law and as a matter of fact, from U.S. Supreme Court to every insurance company and self-insured ERISA plans, a patient or healthcare provider on behalf of the patient should and must file ERISA appeals or ERISA lawsuit if inevitable regardless of PPO or HMO participation or contract.

      Almost every Medical Policy contained in the managed-care contract in USA, PPO or HMO, specifically contained a legal disclaimer that those medical policies were intended for educational and general reference purposes but each individual patient ERISA plan SPD's determines plan benefits coverage, limitations and exclusions, and ironically, on almost every payer's website, a provider or a reader must acknowledge and agree to this ERISA rights warning before one can even read any medical policies on the website which were automatically incorporated into every managed-care contract, and every provider who read these online medical policies simply clicked "I agree" then immediately forgot all completely that ERISA legal disclaimer that ERISA and SPD supersedes, invalidates and preempts any and all managed-care contract, PPO or HMO for each member's plan benefits coverage, limitation and exclusions

        I will present medical policies with legal disclaimers against PPO and HMO from three major payers, Aetna, CIGNA and UnitedHealthcare.

Aetna Clinical Policy Bulletins

Agree to terms and conditions

“Each benefit plan defines which services are covered, which are excluded, and which are subject to dollar caps or other limits. Members and their providers will need to consult the member's benefit plan to determine if there are any exclusions or other benefit limitations applicable to this service or supply."

"The conclusion that a particular service or supply is medically necessary does not constitute a representation or warranty that this service or supply is covered (i.e., will be paid for by Aetna) for a particular member. The member's benefit plan determines coverage. Some plans exclude coverage for services or supplies that Aetna considers medically necessary. If there is a discrepancy between a Clinical Policy Bulletin (CPB) and a member's plan of benefits, the benefits plan will govern."

CIGNA - Coverage Positions/Criteria

"The terms of a participant's particular benefit plan document [Group Service Agreement (GSA), Evidence of Coverage, Certificate of Coverage, Summary Plan Description (SPD) or similar plan document] may differ significantly from the standard benefit plans upon which these Coverage Positions are based. If these Coverage Positions are inconsistent with the terms of the member's specific benefit plan, then the terms of the member's specific benefit plan always control."

UnitedHealthcare Medical Policies

"By clicking "I agree," you agree to be bound by the terms and conditions expressed below, in addition to our Site Use Agreement.

UnitedHealthcare medical policies have been made available to you as a general reference resource. When reading these policies you agree that:

Our Medical Policy is not your patient's Benefit Plan.

Your patient's medical benefits are governed and determined by a benefit document, either a Certificate of Coverage or a Summary Plan Description. You should not rely on the information contained in this Web site section to determine your patient's medical benefits.
 

1. Federal and state mandates and the patient’s benefit document take precedence over these policies.

2. The patient’s benefit document lists the specific services that have coverage limits or exclusions.

Our Medical Policy does not address every situation and individuals should always consult their physician before making any decisions on medical care."

      As required by federal law, ERISA, almost every EOB (Explanation of Benefits) from every ERISA plan payers notified healthcare providers that if you disagree with claim denials, you have a right under ERISA to file ERISA appeals and a right to file lawsuit in federal court under ERISA.

        Simply put, every EOB in the past 34 years has given healthcare providers ERISA Miranda's Rights to appeal or pursue his/her lawsuit in federal court in order to comply with the following requirements from ERISA claim regulation, but in the past 34 years healthcare providers had rarely exercised ERISA Miranda's Rights.

      New Federal Claim Regulation (Final Rule) (PDF)

<http://www.dol.gov/ebsa/regs/fedreg/final/2000029766.htm>

29 CFR § 2560.503-1(g)(h) provide:

"(g) Manner and content of notification of benefit determination.

(1) Except as provided in paragraph (g)(2) of this section, the plan administrator shall provide a claimant with written or electronic notification of any adverse benefit determination. Any electronic notification shall comply with the standards imposed by 29 CFR 2520.104b-1(c)(1)(i), (iii), and (iv). The notification shall set forth, in a manner calculated to be understood by the claimant --

    (i) The specific reason or reasons for the adverse determination;
    (ii) Reference to the specific plan provisions on which the
determination is based;
    (iii) A description of any additional material or information
necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary;
    (iv) A description of the plan's review procedures and the time limits applicable to such procedures, including a statement of the claimant's right to bring a civil action under section 502(a) of the Act following an adverse benefit determination on review;
    (v) In the case of an adverse benefit determination by a group
health plan or a plan providing disability benefits,
    (A) If an internal rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination, either the specific rule, guideline, protocol, or other similar criterion; or a statement that such a rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination and that a copy of such rule, guideline, protocol, or other criterion will be provided free of charge to the claimant upon request; or
    (B) If the adverse benefit determination is based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination, applying the terms of the plan to the claimant's medical circumstances, or a statement that such explanation will be provided free of charge upon request.
    (vi) In the case of an adverse benefit determination by a group health plan concerning a claim involving urgent care, a description of the expedited review process applicable to such claims.
    (2) In the case of an adverse benefit determination by a group health plan concerning a claim involving urgent care, the information described in paragraph (g)(1) of this section may be provided to the claimant orally within the time frame prescribed in paragraph (f)(2)(i) of this section, provided that a written or electronic notification in accordance with paragraph (g)(1) of this section is furnished to the claimant not later than 3 days after the oral notification.

(h) Appeal of adverse benefit determinations. (1) In general. Every employee benefit plan shall establish and maintain a procedure by which a claimant shall have a reasonable opportunity to appeal an adverse benefit determination to an appropriate named fiduciary of the plan, and under which there will be a full and fair review of the claim and the adverse benefit determination."

      Therefore, ERISA plan administrator, third-party claim administrator (TPA) managed-care operator are statutorily obligated to notify a claimant of his/her ERISA right to appeal and ERISA right to sue on every EOB, and if a healthcare provider is intended to exercise ERISA rights to appeal and sue regardless of PPO or HMO participation, the insurance company and TPA should respect, encourage and protect such ERISA compliance practice instead of discouraging, discriminating and interfering or depriving the patient or healthcare provider on behalf of the patient of such ERISA right to appeal in violation of criminal prohibition of ERISA law, 29 USC §1141, by thinking these healthcare providers are troublemakers or hostile agonizing practitioners when they are PPO participating providers.

       An insurance company or TPA should thank healthcare providers for their ERISA appeals if an insurance company or TPA forgot to notify the provider and patient of these ERISA rights to appeal.

      ERISA EOB (benefits notification) requirements for each ERISA plan are public policies and mandatory for each ERISA plan and TPA, regardless if a provider is participating  or signing of PPO or HMO contracts or networks. every managed-care contract is a private contract, can never and will never supersede, invalidate, alter or limit public policy, federal and state laws. If any PPO or private contract violated any public policies, to extent that the provisions of any private contract inconsistent with federal and state laws will be automatically void and become unenforceable.

      This is why every managed-care contract, entered in USA and managed-care contract litigation class-action settlement approved a federal court, such as section 7.10 and 7.11 for Blue Cross Blue Shield Association class-action settlement, Aetna and CIGNA and UnitedHealthcare or everyone else, specifically provided that nothing contained in any managed-care PPO or HMO contract is intended to supersede, alter or limit ERISA rights otherwise available to any patients or providers on patient behalf.

      Therefore, as a matter of fact and as a matter of law, all healthcare providers regardless of PPO or HMO managed care contracting, must comply with ERISA claim regulation to file ERISA compliant appeals for any benefits denials from the employer sponsored health plans in accordance with US Supreme Court ruling in Aetna v. Davila, ERISA claim regulation and managed care contracting. However if the claim dispute is over provider contracting discount and provider relationship, a healthcare provider should pursue a grievance procedures in accordance with PPO and HMO managed care contract.

      As a matter of fact and as matter of law, most healthcare reimbursement and/or recovery professionals or consultants are confused on the definition of an ERISA plan and ERISA appeal in believing that ERISA covers only self-insured plans but not fully-insured/funded health plans (“through purchase of insurance”). Nearly 170 million individuals are covered under ERISA in US.

      ERISA law governs both self-insured and fully-insured/funded ("through purchase insurance") health plans sponsored by employers in private sector. ERISA statutory definition, 29USC1002, from the U.S. Code Online via GPO Access: (Click here)

<http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=browse_usc&docid=Cite:+29USC1002>

      In February 2008, the New York Attorney General announced an industry-wide investigation into allegations that health insurers unfairly saddle consumers with too much of the cost of out-of-network health care.  Seventy percent (70%)  of insured working Americans pay higher premiums for insurance plans that allow them to use out-of-network doctors.  In exchange, insurers often promise to cover up to eighty percent of the “usual and customary” rate of the out-of-network expenses, and consumers are responsible for paying the balance of the bill. 

      ERISA claim regulation was enacted in 1974 by Congress with the intention to protect 170 million working Americans and their families. ERISA  compliant appeals by healthcare providers on behalf of patients are protected under federal law and advocated by employers, insurance industry and managed-care network operators regardless of PPO or HMO participation.

     Regardless with or without PPO and HMO managed care contracting or participation, it is a criminal violation of ERISA under federal law, 29 USC §1141 for anyone to fraudulently interfere with ERISA rights by using deceptions and misrepresentation from and by managed care contracting, PPO or HMO, as 29 USC §1141 states: "It shall be unlawful for any person through the use of fraud, force, violence, or threat of the use of force or violence, to restrain, coerce, intimidate, or attempt to restrain, coerce, or intimidate any participant or beneficiary for the purpose of interfering with or preventing the exercise of any right to which he is or may become entitled under the plan,........For example, Section 1141 would reach the use of deception directed at misleading a welfare plan beneficiary as to the amount of health benefits owed to the beneficiary under the terms of the plan"

        Failure by an ERISA plan to offer an opportunity to the claimant to seek for ERISA full and fair reviews is a violation of public policy, ERISA, and a breach of fiduciary duties under the plan. Any intentional deception or misrepresentation by anyone to interfere with ERISA right to appeal by a claimant or his/her authorized representative is a criminal violation of federal law, 29 USC §1141.

         It has been a common practice by some managed-care payers, TPA or managed-care network operators to intimidate, threat or coerce PPO/HMO participating health care providers to "cease and desist" any and all ERISA appeals or exercising any ERISA rights or these participating providers will be "kicked out" from the PPO/HMO networks and drive these participating providers who are exercising ERISA rights completely out of business and out of managed-care PPO/HMO networks. Any potential violators of 29 USC §1141 shall be advised to seek immediate compliance advice and consult with Department Of Justice Criminal Resource Manual before developing criminal intent and criminal act from otherwise potential innocent mistakes. It has been reported that United States Department Of Justice (DOJ) will investigate and prosecute any violators of 29 USC §1141 in connection with healthcare provider ERISA appeals. "Any person who willfully violates this section shall be fined $10,000 or imprisoned for not more than one year, or both" under 29 USC §1141.

      The following information is from the Website of United States Department Of Justice:

      As better explained by American Benefits Council on behalf of all of the self-insured and fully-insured ERISA plans, ERISA appeals by healthcare providers are the best ways to avoid unnecessary litigations and to contain skyrocketing health care costs.

      In summary, PPO or HMO participating managed-care network contracts primarily control voluntary provider contractual discount and network-provider relationship, while ERISA, the federal law and Summary Plan Description (SPD), the individual member's plan provisions, completely govern and determine the plan/policy benefits coverage, limitations and exclusions. Therefore, if you received a claim denial in whole or in part for benefits coverage, exclusions and limitations under the plan provisions, you should file ERISA appeals, however if you received claim reduction as a provider PPO discount or HMO capitation, or you're not happy with how the network treated you, you shall pursue a provider appeal under provider grievance procedures under PPO/HMO contract.

      No one from insurance companies and managed care networks, PPO or HMO can interfere with your ERISA rights to appeal and to pursue a lawsuit in federal court if your claim for benefits has been denied or delayed in whole or in part. No one should ask you to give up your statutory rights under federal laws unless you voluntarily waived your "healthcare constitutional rights"-"ERISA Miranda's Rights" regardless with of without PPO or HMO participations or contracting.

      As a matter of fact and as a matter of law, it has been repeatedly clarified, certified and agreed upon,  for all managed care contracts, PPO or HMO,  by insurance and benefits industry or managed-care third-party payers, for all managed-care network contracting,  participating providers, PPO or HMO, and in PPO/HMO contracting/participating agreement and class-action settlement legally approved by federal courts that NOTHING contained in any PPO/HMO contracting agreement or PPO/HMO class action settlement "is intended, or shall be construed, to supersede, alter or limit the rights or remedies otherwise available to any Plan Member under § 502(a) of ERISA or to supersede in any respect the claims procedures for Plan Members of § 503 of ERISA, or required by applicable state or federal law or regulation."

For more information related to this subject on ERISA and PPO:

ERISAclaim.com - ERISA or PPO? Managed Care Slavery or ERISA Superhero

http://erisaclaim.com/ERISA_or_PPO.htm

ERISAclaim.com: ERISA or non-ERISA Appeal? ERISA Appeal Fact Sheet

http://erisaclaim.com/ERISA_or_non-ERISA_Appeal.htm

ERISAclaim.com: 2010 Appeal Books & Systems for Maximal Reimbursement by Compliance

http://erisaclaim.com/products.htm

      If you have any questions, please contact Dr. Jin Zhou, the president of the ERISAclaim.com at ERISAclaim@aol.com.

Jin Zhou

President

www.ERISAclaim.com

630-736-2974 (office)

630-808-7237 (mobile)

September 23, 2009