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1. ERISA for Hospital's Money Problems and  U. S. Supreme Court Unanimous Ruling on Managed Care, Aetna Health Inc. v. Davila

2. ERISA Benefit$ Claim Is Not the Same As Hospital Provider Contract Dispute$: (PASCACK VALLEY HOSPITAL, INC. v  LOCAL 464A UFCW WELFARE REIMBURSEMENT PLAN (3rd Cir. 11/01/2004)

3. ERISA Definition of Adverse Benefits Determination: Low pay or Discount? DOL FAQ C-12: § 2560.503-1(m)(4).

4. There Is No Way around ERISA If You Would like to Get Paid. CLEGHORN V BLUE SHIELD OF CALIFORNIA, 9th Cir., 05/23/2005

5.  Medicare Secondary Payer Overpayment Recoupment, ERISA Again? GAO-04-783 & Telecare Corp. v. Leavitt

6. ERISA Provides Specific Protections for Medical Claim Denials and Appeals

7. No ERISA Appeals, No Acceptance of Scientific Papers and FDA Approvals

8. ERISA Pre-Service Claim Regulation Provides The Best Protections for Any Claims with Requirement of Pre-Certifications, Prior-Authorizations or Any Prior-Approvals

9. Medical Necessity for The Federal Employees Health Benefit Plan (FEHBP)

10. CMS New Appeal Rules: "Overhaul of the Medicare Claims Appeals System"

11. We Offer On-Site Education and In-House Consulting.

    ERISAclaim.com - New! On-site Programs for ERISA & New  CMS/Medicare Compliance

 

Dr. Jin Zhou Will Speak at This 2007 National Conference   World Research Group has also organized two in-depth workshops conducted by the industry’s thought leaders that will drill down into the solutions you need to prevent, reduce and overturn denials. Register for both to maximize your on-site learning experience.   Don’t Miss these Must-Attend, In-Depth Workshops! Mastering the Medicare & ERISA Appeal Process: Maximum Reimbursement through Compliance ERISAclaim.COM The Denial Diagnosis Tool Kit: A Claim-by-Claim Action Guide to Integrating Technical, Clinical, Legal and (sometimes) Political Perspectives in Managing Denials ADVANCED REIMBURSEMENT MANAGEMENT links to registration: http://worldrg.com/showConference.cfm?confcode=HW765   For a brochure, click here        4th Annual Optimizing Managed Care Contracting for Hospitals September 19 - 20, 2007 Chicago, IL Register   •   Download a Brochure

ERISA for Hospital's Money Problems and  U. S. Supreme Court Unanimous Ruling on Managed Care, Aetna Health Inc. v. Davila

An Unanimous US Supreme Court: Regardless of FDA approval, ERISA controls and regulates reimbursement.

FDA for reimbursement? Not Quite Yet, What Does the Unanimous US Supreme Court Say?

On June 21, 2004, an unanimous US Supreme Court ruled that claim processing 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.

ERISAclaim.com: "employer-sponsored group health plans" = ERISA-"regulated benefit plans", both self-insured and fully-insured (through purchase of insurance) health plans, (ERISA - Title 29, Chapter 18.  Sec. 1002.)

ERISA Benefit$ Claim Is Not the Same As Hospital Provider Contract Dispute$: (PASCACK VALLEY HOSPITAL, INC. v  LOCAL 464A UFCW WELFARE REIMBURSEMENT PLAN (3rd Cir. 11/01/2004)

PASCACK VALLEY HOSPITAL, INC. v  LOCAL 464A UFCW WELFARE REIMBURSEMENT PLAN

(3rd Cir. 11/01/2004)

ERISA Does Not Pre-empt Hospital's PPO Discount Lawsuit

Excerpt: "The Supreme Court has recently clarified the inquiry in such cases:

 

It follows that if an individual brings suit complaining of a denial of coverage for medical  care, where the individual is entitled to such coverage only because of the terms of an ERISA - regulated employee benefit plan, and where no legal duty (state or federal)  independent of ERISA or the plan terms is violated, then the suit falls within the scope of ERISA §502(a)(1)(B). In other words, if an individual, at some point in time, could have brought his claim under ERISA §502(a)(1)(B), and where there is no other independent legal duty that is implicated by a defendant’s actions, then the individual’s cause of action is completely pre-empted by ERISA § 502(a)(1)(B)." (page 7)

 

"Coverage and eligibility, however, are not in dispute. Instead, the resolution of this lawsuit requires interpretation of the Subscriber Agreement, not the Plan." (page 10)

 

"The Ninth Circuit held that “the Providers’ claims, which arise from the terms of their provider agreements and could not be asserted by their patient assignors, are not claims for benefits under the terms of ERISA plans, and hence do not fall within § 502(a)(1)(B).” Id. at 1050. The court explained:

[T] he Providers are asserting contractual breaches . . . that their patient-assignors could not assert: the patients simply are not parties to the provider agreements between the Providers and Blue Cross. The dispute here is not over the right to payment, which might be said to depend on the patients’ assignments to the Providers, but the amount, or level, of payment, which depends on the terms of the provider agreements. Id. at 1051 (first emphasis added). 

Because the Providers asserted “state law claims arising out of separate agreements for the provision of goods and  services,” the court found “no basis to conclude that the mere fact of assignment converts the Providers’ claims into claims to recover benefits under the terms of an ERISA plan.” Id. at 1052.9" (page 11)

 

"Accordingly, removal in this case was improper, and the order of the District Court denying remand will be vacated. We will remand this case to the District Court with instructions that the District Court, in turn, remand to the Superior Court of New Jersey."

ERISAclaim.com Comments:

1. ERISA does not preempt pure provider (PPO/HMO) contract dispute in state court.  This ruling is significant with profound impact in today's managed-care market, as provider contract disputes are as popular as ERISA benefits dispute but unsuccessfully pursued by providers due to ERISA preemption;
2. Following the 11^th Circuit Court ruling, Leonard J. Klay v. Humana, on national class actions by 950,000 physicians, that provider’s class-action all RICO-related claims don not have to be arbitrated, claims over provider contract dispute was improperly certified as a national class and such claims shall be tried in each state jurisdiction, more state lawsuits are expected to explode over provider’s claim over state RICO claims, claims over PPO discount, bundling and down coding and prompt pay violation arising out of PPO contract instead of ERISA plan provisions;
3. This case is only limited to PPO discount dispute with a signatory party of subscriber agreement which happens to be the plan as well, where there is no coverage and eligibility dispute, ERISA is moot, or there is no denial from ERISA plan, and in absent of PPO discount, the claimant will be entitled to 100% reimbursement;
4. It is very important to understand the difference of ERISA and PPO, if ERISA benefits are in dispute or not moot, taking this approach of state court lawsuit for medical claims is still a claims suicide practice.

ERISA Definition of Adverse Benefits Determination: Low pay or Discount? DOL FAQ C-12: § 2560.503-1(m)(4).

DOL also clarifies the definition of benefits claim denial, simply put, any payments less than 100% claimed is considered benefits denial:

There Is No Way around ERISA If You Would like to Get Paid.

Federal Court Of Appeals:

CLEGHORN V BLUE SHIELD OF CALIFORNIA

9th Cir., 05/23/2005

OPINION

CANBY, Circuit Judge:

"We are presented once again with a question concerning the degree to which the federal Employee Retirement Income Security Act (ERISA) preempts state law. Douglas D. Cleghorn is a participant in his employers ERISA health plan offered by Blue Shield of California (doing business as Care-America) (Blue Shield). On one occasion he sought and received emergency medical services and Blue Shield denied reimbursement. Cleghorn sued Blue Shield in California state court, asserting state-law causes of action and alleging that Blue Shield had violated an emergency care provision in section 1371.4(c) of the California Health and Safety Code. Blue Shield removed the case to federal court and the district court held that Cleghorns claims were preempted by ERISA. When Cleghorn declined to amend his complaint to allege an ERISA claim, the district court dismissed his complaint for failure to state a claim. We affirm the judgment of the district court."

Statement of Sharon J. Arkin, Partner, Robinson, Calcagnie & Robinson [PDF] [HTM]

April 24, 2001

Comment from ERISAclaim.com:

In a lawsuit for reimbursement of emergency medical services fees for emergency room visit , plaintiff's California state court claim based on layperson standard, alleging that Blue of California violated an emergency care provision in section 1371.4(c) of the California Health and Safety Code, and plaintiff's refusal to follow ERISA rules when given a chance in federal court, is preempted by ERISA and therefore completely dismissed.

 

In simplest English-language, if anyone is disputing or claiming any money payment, even one penny from an ERISA sponsored health plan, regardless its managed-care shape, HMO or PPO, or its severity, emergency or nonemergency, ERISA law controls your dispute and lawsuit, your state laws are completely preempted by ERISA.

 

If your claim is from health insurance through employment in private sector, it is an ERISA claim.

 

ERISA claim regulation provides for better protections for patients and physicians.

Once again, failure by providers and patients to follow ERISA claim regulation and to take legal action under ERISA will result in more damages to our entire healthcare system, by continuing to rely upon state laws to argue an ERISA claim and case.

Medicare Secondary Payer Overpayment Recoupment, ERISA Again? GAO-04-783 & Telecare Corp. v. Leavitt

ERISA Provides Specific Protections for Medical Claim Denials and Appeals

What You Should Know about Filing Your Health Benefits Claim

New Federal Claim Regulation, effective January 1, 2003, is the best and the most powerful protection for improper medical necessity denials:

1. "Plans must consult with appropriate health care professionals in deciding appealed claims involving medical judgment." [70268-70269, CFR § 2560.503-1(h)(3)(iii)]

2. "The term `health care professional' means a physician or other health care professional licensed, accredited, or certified to perform specified health services consistent with State law." [page 70271 CFR § 2560.503-1(m)(7)]  

3. A Full and Fair Review with new definitions and protection requires De Dovo reviews on two appeals by at least four (4) different people, two (2) different fiduciaries with ERISA plan, and two (2) different Health-care professionals independent to the ERISA plan. [Page 70252-70253, 70268-70269, CFR § 2560.503-1(h)(3)]

4. Plan must disclose all the "secrets" under new definitions of relevant documents with better disclosure obligations, no more medical necessity secrets, UCR fee schedules are no longer confidential. [Page 70252 & 70271, CFR § 2560.503-1(m)(8)  (DOL FAQ B-5, C17)]

Therefore, it is extremely important for Hospitals and health-care providers to distinguish pure policy exclusion from medical necessity denials, and to understand appropriate actions and steps to be taken to prevail benefits claims under ERISA, the federal governing Law for your reimbursement from any employer-sponsored health-care plans.

Hospital's correct coding and billing is only 1/3 of denial dispute, ERISA claims practice is the real challenging steps for Hospitals medical claims to be reimbursed legitimately under federal laws and specific health plan provisions.

No ERISA Appeals, No Acceptance of Scientific Papers and FDA Approvals

When F.D.A. Says Yes, but Health Insurers Say No to Medical Devices (The New York Times; one-time registration required)

 

"Charité needs to show substantial improvement in the patients' quality of life and clinical outcomes," said Michael Chee, a spokesman for Blue Cross Blue Shield of California, a unit of WellPoint that is one of many large Blue Cross insurers that has denied coverage for Charité."

 

"Johnson is hoping to gain more support after the publication on July 15 of two articles on the F.D.A. trial data in Spine, a peer-reviewed medical journal. "We expect that will lead to a new round of policy reviews," said John Argiro, director of reimbursement for DePuy Spine, the Johnson subsidiary that makes the disk."

And there is no other way around ERISA if any one is expected to get paid by an employer sponsored health plan, regardless of its shape, HMO, POS, PPO & P4P: CLEGHORN V BLUE SHIELD OF CALIFORNIA  and Aetna Health Inc. v. Davila, in accordance with unanimous US Supreme Court ruling.

ERISA Pre-Service Claim Regulation Provides The Best Protections for Any Claims with Requirement of Pre-Certifications, Prior-Authorizations or Any Prior-Approvals

What percentage of hospital procedures for nonemergency or urgent care will not need prior authorization or preapproval from health plans?

ERISA Claims Procedure.§2560.503-1(m)(2)

"(2) The term “pre-service claim” means any claim for a benefit under a group health plan with respect to which the terms of the plan condition receipt of the benefit, in whole or in part, on approval of the benefit in advance of obtaining medical care."

Therefore, if a surgery is required by the plan to obtain a prior-approval, and such request is denied, the patient and doctor can appeal the denial even if the surgery was never performed yet, because it is a pre-service claim under ERISA, ("no money-down appeal", as Dr, Zhou calls it). A pre-service claim under ERISA is also entitled to "ERISA Prompt Pay" protections.

ERISA “Prompt Pay” Time Limits  © 2003 - 2004  Jin Zhou, ERISAclaim.com   ERISA §2560.503-1 Claims Procedure   New Rules  Effective on 01/01/2003 for all ERISA plans   self-insured and fully-insured, §2560.503-1(a) Old Rules Urgent Care Claim Preservice Claim Post-Service Claim Disability Claims ERISA Claims Claim Beginning Time Beginning at a Time a Claim Is Filed, Regardless of Clean Claim or Not, In Accordance With Plan Procedures, § 2560.503-1(f)(4) Decision Maximal Time Limits In No Event Exceeding 90 Days Period, §2560.503-1(f) < 180 days "Not Clean" Notification Time 24 hours 5 days N/A N/A N/A Claimant Claim Cleanup Time 48 hours 45 days 45 days 45 days N/A Plan Initial Determination ASAP, <48 hours (clean claim) < 72 hours (cleaned up claims)   15 days 30 days 45 days 90 days   Claimant Appeal Deadline 180 days 180 days 180 days 180 days 60 days Plan 1st Level Appeal Response Time 72 hours 15 days 30 days 45 days 60 days Plan 2nd-Level Appeal Response Time 15 days 30 days 90 days 120 days with extensions Plan Extension Time 48 hours 15 days 15 days 75 days 120 days Review/Appeal Maximal Limit 72 hours 30 days (one Appeal) 15 days (two appeals) 30 days (two appeals) 60 days (one Appeal) 105 days 180 days Initial Determination/EOB by: "The Plan Administrator", § 2560.503-1(g) Appeal Delay & Denial to: "An Appropriate Named Fiduciary of the Plan", § 2560.503-1(h) Review/Appeal Decision by: "The Plan Administrator", § 2560.503-1(j)

Medical Necessity for The Federal Employees Health Benefit Plan (FEHBP)

Under5 U.S.C. § 8901, the Federal Employees Health Benefit Plan (FEHBP) provides health care coverage to more than nine million Federal employees and their dependents. The U.S. Office of Personnel Management (OPM) is enforcement Federal agency for administration of benefits claims, but OPM contracts with health plans to serve Federal employees, administers the FEHBP.

There is no specific definition for "medical necessity" or medical necessity review standards for both initial and administrative appeal process in both federal statute and administrative regulations, except for "FEHB Plan Brochures" drafted by health plans or insurers but published by OPM.

Federal Employees Health Benefit Plan does offer appeal process similar to ERISA appeal process although ERISA regulation does not directly regulate federal employee benefit plans.

OPM does retain level to appeal jurisdiction but delegates discretionary authority to each individual health plan contractor.

Most health-care plan contractors voluntarily adopt ERISA claim regulation and state law regulated utilization review and ex-con review programs even though neither ERISA or state law directly apply to the federal employee health pogrom.

After exhausting to levels of appeal with OPM, and a claimant may commence lawsuit only in federal court and against OPM, Federal Government, instead of health plan and its contractors for a possible recovery similar to ERISA remedies, no punitive damage.

For OPM appeal process and each individual plan brochures, the following hyperlinks will be extremely authoritative and helpful, especially each individual plans appeal process and OPM second-level appeal guidelines.

For better understanding of relevant federal law on medical necessities, the following information from HHS web site will be extremely helpful:

Traditional "squeaky wheel" approaches by Hospitals are insufficient and practically flawed under new health-care crisis, partially blamed by critics on new technology costs.

We offer educational assistant programs to medical device makers and health-care providers on strategy, prevention of denials, and how to effectively use and comply with ERISA claim regulation to achieve maximum reimbursement for what their patients are legally entitled to in accordance with applicable Federal ERISA law, state utilization review and external review laws.

ERISA Compliance/Approval must be integral and final step of any revenue and financial management for Hospitals and health-care providers.

Hospitals must include ERISA claim compliance and appeals in their standard marketing programs to health-care providers in order for their patients to receive benefits reimbursement that each patient is legally entitled to under federal law and specific benefits plan provisions.

Traditional approach by Hospitals are insufficient and practically flawed under new health-care crisis, partially blamed by critics on new technology costs.

We offer educational assistant programs to Hospitals and health-care providers on strategy, prevention of denials, and how to effectively use and comply with ERISA claim regulation to achieve maximum reimbursement for what their patients are legally entitled to in accordance with applicable Federal ERISA law, state utilization review and external review laws.

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