Managed-Care
Claim Denials & US Healthcare Crisis? What Does
the Unanimous US
Supreme Court Say?
On June 21, 2004, an unanimous US Supreme
Court ruled that claim processing (medical judgment & benefits
determination) and denials of benefits under the
employer-sponsored health plans,
ERISA-regulated benefit
plans,
for
both self-insured and
fully-insured (through purchase of insurance) health plans,
are completely governed by federal law ERISA, that supersedes and
invalidates state laws.
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ERISAclaim.com -
Supreme Court Managed Care ERISA Watch
Aetna Health Inc. v. Davila
06/21/04
Opinion of the
Court
"Held:
Respondents’ state causes of action fall
within ERISA§502(a)(1)(B), and are therefore completely
pre-empted by ERISA §502 and removable to federal court.
Pp. 4–20."
"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.7
It is so ordered."
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Happy or Sad
30th Birthday To ERISA?
(Copyright
© 2004
by
Jin Zhou, ERISAclaim.com)
Sept. 2, 2004
On Sept. 2, 1974,
exactly 30 years ago today, ERISA, The Employee Retirement
Income Security Act,
was signed into law by President Gerald R. Ford. The congressional intent in enacting ERISA was to
protect employees in pension and welfare plans, to provide
uniform federal protections in response to the failure of the
Studebaker Co. in December 1963, with thousands of long-service
employees cheated out off their promised pensions, and to
preempt any state laws when the employees pension and welfare
benefits were threatened. 30 years later, ERISA Failure in its
compliance and enforcement left thousands of retirees without
medical benefits, and resulted in a skyrocketing national healthcare expenditure explosion with 45 million uninsured and a possible national pension bailout.
ERISA Failure Syndrome
U.S. Healthcare Crisis
Trilogy
Jin Zhou Identifies "ERISA Failure" That Killed
U.S. Healthcare
"Failure of Imagination"
Again?
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ERISA Celebrates 30th Anniversary As Trouble Brews For the Pension
Insurance Program (Spencer Benefits Reports)
Excerpt: "The seed for
ERISA was planted with the failure of the Studebaker Company in
December 1963, leaving thousands of long-service employees
without their promised pensions."
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ERISA Demystified
1.
ERISA
stands for
Employee Retirement Income Security Act
2.
"Health
Insurance through Employment in Private Sectors"
=
ERISA =
80% of
health-care claims or
60% of health expenditures in the U. S.
An
ERISA-regulated
“welfare plan” includes any plan or program established by an employer
for the purpose of providing
medical care or benefits to its employees
through the purchase of insurance (fully-insured)
or otherwise. An ERISA plan can be self-insured or fully-insured in private
sectors. 29
U.S.C. 1002(1).
3.
Governmental plan,
church plan, worker's compensation, Medicare, individual insurance
policy, school plan (if under governmental and
church status) and third party liability claims are
exempted from ERISA.
4.
ERISA
Preempts Any State Laws When It Is "Related to" An
Employee Benefits Dispute (Medical Insurance Claim Dispute) =ERISA
Shield
5.
ERISA Does Not Provide
Any Remedy except for SPD Statutory Penalty and "Contractual Damages"
(Your Medical Bills)
6.
ERISA Does Not Permit
Physician’s Lawsuit Unless At Least Two Levels of Appeals Are Completed
and A Legal Assignment of Right to Sue Is Obtained from the Patient.
(Legal Standing and Administrative Remedy Exhaustion)
7.
Any ERISA Appeals by Physicians Are Not Valid Unless A Legal Assignment
of Benefit Is Obtained from the Patient (Q-B2, B3)
8.
ERISA Provides the Best Disclosure from ERISA plans & Insurance
Companies but Physicians Have Never Realized This Important Protection
9.
ERISA Might Be the Best Protection for Physicians If They Understand How
ERISA Operates
10.
Patients Bill Of Rights (PBOR)
May Never Help Physicians and Patients
Unless Physicians and Patients
Really Understand ERISA, Since
PBOR Requires Both Internal of Two Levels and External Appeals/Reviews
before A Lawsuit Can Be Filed and Since Physicians Have Had Poor or
No Understanding of Proper ERISA Internal Appeal Procedures for 28 years
11.
ERISA Is Poorly
Understood by Physicians
12.
ERISA Protects Health-care Providers Who Have Legal Assignment of
Benefits and Have Completed At Least Two Levels of Appeals
13.
Without A Proper Legal
Assignment of Benefits and Without Full Compliance with
ERISA Appeal Procedures (Q-B2, B3), Healthcare Providers Are Illegal
Aliens in ERISA Land
14.
Associations for Medical and Health-care Providers, Hospitals Across
the Country Are More Responsible (At Least Equally Responsible) Than
Insurance Industry/ERISA Plans in Managed Care Failure and Nightmares,
Because Most of Them Never Had Intentions to Fix the Managed Care
Problems and Operated under "Conflict of Interests", And Because They
Have Been Absolutely Clueless About ERISA, The Federal Law
Protecting Them And Regulating About
80% of
Health-care Claims or
60% of Health Expenditures in the U.S., And Have No Intention To
Study, Educate And Comply With
ERISA And
New Federal Claim Regulations, Which Has Provided
The Very Protections They Are Fighting For.
15.
New
Federal claim/ERISA Regulations,
effective 01/01/2003, provide the
most powerful protections and practical solutions for the most of our
managed care problems,
physicians and healthcare providers nationwide are clueless and have
failed to learn and comply with
New ERISA Rules to get paid
promptly due to "Managed-Care Secondary Gain Syndrome".
16.
DOL, FAQ, A8 clarifies HM or PPO Discount v. ERISA Claim Denial =
the Provider's
HMO or PPO contractual dispute will have no effect on a
claimant’s
ERISA
right to ERISA benefits under
an ERISA plan
17.
What You Should Know about Filing Your Health
Benefits Claim (DOL Claims Card)
ERISA Related Healthcare Facts
1.
ERISA Regulates and Governs ERISA Claim Denials and Disputes
2.
Up to
80% of
health-care claims or
60% of health expenditures in the U. S., Are
ERISA Claims
3. ERISA
Governs Approximately 6 Million Private Health And Welfare Plans.
These Plans Cover Approximately 150 Million Workers And Their Dependents
And Hold Assets Of More Than $4.6 Trillion
4. "In
2001, 32.2 percent of the elderly had
employment-based health insurance coverage
in addition to Medicare,
up from 28.7 percent in 1987." (page 2) (Facts
from EBRI: Health Insurance and the Elderly (PDF) - Employee
Benefit Research Institute)
5.
More than 208 million nonelderly Americans had insurance coverage in
2003, while 44.7 million were uninsured. the majority of Americans,
159.2 million, insured in 2003 received coverage through an employment
based health plan, 42.5 million were covered by public programs, and an
additional 17 million purchased policies directly from an insurer. More
than 32 million Americans participated in the Medicaid or State
Children’s Health Insurance Program (S-CHIP),1 and 6.9 million received
their health insurance through the Tricare and CHAMPVA2 programs and
other government programs for retired military and their families. (Sources
of Health Insurance & Characteristics of the Uninsured: Analysis of the
March 2004 CPS (PDF) - Employee Benefit Research Institute)
6. Up
to
2/3 of Healthcare claims Are Denied Nationwide Each Year
(Denial/Discount) (DOL
FAQ C12)
7.
Significant Percentage
of Healthcare claims Are
Partially Denied
8. $1.55
trillion Are Spent in Healthcare in the U.S. in 2002, about 14.9% of
Entire National Domestic Product, Two of the Four Main Causes for
Escalating Health Care Costs (Extremely High Administrative Costs and
Managed Care Problems) Are Directly Associated with Health Care Coverage
Dispute and Claims Denials under ERISA
9.
Physicians & Hospitals
Rarely Filed Valid ERISA Appeals for 30 years
10.
Physicians Are at Breaking Point in Their Business Survival As a Result
of the Managed Care Nightmare and Claims Denials under ERISA Shield
11.
Most Legislative
Efforts and Litigations by Physicians and Patients Failed Due to ERISA
Shield and the Lack of Understanding of ERISA by Patients and
Physicians
12. Legislation,
Litigation and the Extremely High Cost Healthcare Administration Are Not
Answers to Managed Care Nightmare and Physician's Business Survival
Unless healthcare providers Gain A Reasonable
Understanding and
Practice of
ERISA Claims Appeal Procedures
13. "The
original Version" of Patient's Bill Of Rights was dead on
February 5, 2003, (H. R. 956 (pdf).
Norwood Introduces The Patient Protection & ERISA Clarification Acts
14. ERISA
Claim Regulation, The “Patient Rights Bill”, Went Into Effect On
Jan. 01, 2003 For All Health Plans In Private Sectors, For Both
Self-Insured And Fully-Insued (With Purchase Of Insurance) With
Better Protections Than Physicians Dreamed
15. ERISA
Claim Regulation Was Ignored, Rejected, Misinterpreted, and Withheld
by Health Care Providers and Hospital Associations, As They Did for
ERISA In Past 30 years, While Managed Care Claim Denials, Skyrocket High
Health-care Costs and Medical Malpractice Premiums Escalated,
Association's Litigation and Patient's Bill Of Rights "Campaign" At Both
Federal and State Levels Pursued Contradictorily by These
Associations across the Country
16. In
a letter from Republican Congressional leader, John Boehner, to the
Secretary of Labor and insurance/benefits industry, he states that "specifically,
we are concerned about provisions in the final rule that go even further
than the patients' rights bills passed by the Congress", and he
urged DOL to revise and delay the entire claims regulation
17. "Forty
states required individuals to first exhaust their health policy’s
internal appeals and grievance process before seeking external review."
(GAO, September 2003, Page 46) The health policy’s internal appeals
and grievance process =
ERISA appeals 80% of the time
18. 950,000
MD's Settled With Aetna & Cigna on ERISA (ERISAclaim.com)
19. The
Latest AMA (PSA) Managed Care Hassles Survey through nationwide state
medical associations and national medical specialty societies identified
the most popular and important managed-care claim denials and delays.
Title 29 U.S.C. § 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, this title, section 3001, or the Welfare and
Pension Plans Disclosure Act. Any person who willfully violates
this section shall be fined $10,000 or imprisoned for not more
than one year, or both. The amount of fine is governed by 18
U.S.C. § 3571. The U.S. Sentencing Guidelines address 29 U.S.C.
§ 1141 under the guidelines for "Fraud and Deceit" (U.S.S.G. §
2F1.1) or for "Extortion by Force or Threat of Injury or Serious
Damage (U.S.S.G. § 2B3.2)......"
"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 or at misleading a pension plan participant as to
the amount of retirement benefits to which he would become
entitled under the plan upon his retirement."
ERISA in the United States Code
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