ERISAclaim.com - ERISA for Hospital Reimbursement Turnaround

ERISA for Hospitals

Reimbursement Turnaround

by Jin Zhou, 07/29/2005

630-736-2974

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

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)

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

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

ERISA Provides Specific Protections for Medical Claim Denials and Appeals

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

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

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

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

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.)

ERISAclaim.com - Supreme Court Managed Care ERISA Watch

An Unanimous U.S. Supreme Court Ruling in

Managed Care and Medical Malpractice

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."

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:

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;

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;

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;

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).

Aetna + CIGNA Settlement
Demystified

Settlements = ERISA + 3 E. B.

(Click on each hyperlinks for details)

"Aetna and CIGNA Settlement Secrets"(www.aetna.com)

Aetna ERISA "Talking Points" (www.aetna.com)

ERISA stands for Employee Retirement Income Security Act
E. B. = External Boards (of Reviews) (§7.10-7.11): 1) Medical Necessity, 2) Billing & Coding and 3) Policy Coverage
Settlements Only for MCO/Provider Contract Disputes
Settlements Not for Patient Coverage/ERISA Disputes, (§7.10-7.11)
Patient Disputes = ERISA/Coverage/Medical Necessity/Bundling & Down Coding
Provider Disputes = PPO Discount/HMO Capitation/Provider Relationship (DOL FAQ A8)
Patient Disputes ≠ Provider Disputes, (DOL FAQ A8); Provider/MCO Contract (PPO/HMO) Disputes are not Triggered until Patient ERISA Disputes With the ERISA Plan Are 100% Resolved or Moot (DOL FAQ C12) (PASCACK VALLEY HOSPITAL, INC. v LOCAL 464A UFCW WELFARE REIMBURSEMENT PLAN (3rd Cir. 11/01/2004), Northeast Hosp. Authority v. Aetna Health Inc., (October 17, 2007)
External Reviews (3 E. B.) Are Not Available until Internal Reviews (ERISA) Completed, (GAO)
ERISA = Federal Law Mandate; External Reviews = State Law Mandate, (GAO)
No ERISA Compliance = No Rights for Any One

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

C-12: If a claimant submits medical bills to a plan for reimbursement or payment, and the plan, applying the plan’s limits on co-payment, deductibles, etc., pays less than 100% of the medical bills, must the plan treat its decision as an adverse benefit determination?

Under the regulation, an adverse benefit determination generally includes any denial, reduction, or termination of, or a failure to provide or make payment (in whole or in part) for, a benefit. In any instance where the plan pays less than the total amount of expenses submitted with regard to a claim, while the plan is paying out the benefits to which the claimant is entitled under its terms, the claimant is nonetheless receiving less than full reimbursement of the submitted expenses. Therefore, in order to permit the claimant to challenge the plan’s calculation of how much it is required to pay, the decision is treated as an adverse benefit determination under the regulation. Providing the claimant with the required notification of adverse benefit determination will give the claimant the information necessary to understand why the plan has not paid the unpaid portion of the expenses and to decide whether to challenge the denial, e.g., the failure to pay in full. This approach permits claimants to challenge whether, for example, the plan applied the wrong co-payment requirement or deductible amount. The fact that the plan believes that a claimant’s appeal will prove to be without merit does not mean that the claimant is not entitled to the procedural protections of the rule. This approach to informing claimants of their benefit entitlements with respect to specific claims, further, is consistent with current practice, in which Explanation of Benefits forms routinely describe both payable and non-payable portions of claim-related expenses. See § 2560.503-1(m)(4).

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

Federal Court Of Appeals:

No Other Way around ERISA, Regardless How Artfully and Creatively in Patient Lawsuit, ERISA Preempts All State Laws If You Want Money from ERISA Plans.

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

Statement of

Sharon J. Arkin, Partner, Robinson, Calcagnie & Robinson,

Newport Beach, California,

on behalf of Association of Trial Lawyers of America

Testimony Before the Subcommittee on Health

of the House Committee on Ways and Means

Hearing on Patient Protections in Managed Care

"H. Conclusion.

The ERISA "experiment" of total tort immunity is a dismal failure. People have suffered and died as a direct result. It is time to call a halt to this unwarranted and unprecedented immunity and to restore balance to the system.

Something must be done about ERISA's remedy limitations. And the need is not just the "superficial" one of fulfilling the fundamental principle of equity that "for every wrong there is a remedy." The need runs much deeper. As noted by Judge Young:

"A further cost of this near absolute immunity is its pernicious effect on our democratic system. Whenever Congress extinguishes a right which heretofore has been vindicated in the courts through citizen juries, there is a cost. It is not a monetary cost. It is a cost paid in rarer coin --the treasure of democracy self." (Andrews-Clarke, at p. 63, fn. 73.)

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.

From Doctors and Hospital Associations in California, without ERISA Education or Compliance in the Worst Healthcare Crisis

CMA Tells Supreme Court: Health Plans Must Not Be Allowed to Delegate Then Evade Payment Responsibility for Emergency Services

Click here to read CMA's letter to the California Supreme Court.

Click here to read CMA's amicus brief in this case.

Court Rules Health Plans Can Evade Payment
Responsibility for ER Services; CMA Weighs Appeal [Posted 09/19/03]

CMA Tells Court: Health Plan Must Pay for Emergency Services [Posted 10/24/02]

#######################################

April 2005 A Look at Managed Care Issues in 2005 California is among the .....(calhealth.org)

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

Medicare Secondary Payer: Improvements Needed to Enhance Debt, GAO Says (U.S. Government Accountability Office)

Excerpt: "Last year, employer-sponsored group health plans ... were responsible for most of the nearly $183 million in outstanding Medicare secondary payer (MSP) debt. MSP debts arise when Medicare inadvertently pays for services that are subsequently determined to be the financial responsibility of another. The Centers for Medicare & Medicaid Services ... administers Medicare with the assistance of about 50 contractors that, as part of their duties, are required to recover MSP debt."

Telecare Corp. v. Leavitt

(Fed. Cir. 2005)

"This case involves a dispute between Telecare Corp. (“Telecare”) and the government as to Telecare’s liability under the Medicare Secondary Payer statute, Social Security Act § 1862, codified at 42 U.S.C. § 1395y. The United States District Court for the Northern District of California held that Telecare was liable as a secondary payer. We affirm.

......

Therefore, we hold that the statute allows the United States to initiate an action against any employer that “sponsors or contributes to a group health plan,” where the group health plan “make[s] payment with respect to the same item or service (or any portion thereof) under a primary plan.” Such a construction gives reasonable meaning and effect to all the words in the statute, and is to be preferred over Telecare’s proposed interpretation, which would render parts of the statute inoperative. Telecare sponsors and contributes to the group health plan, and under the plain language of the statute it cannot prevail."

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.)

MEDICARE OVERPAYMENTS REACHED NEARLY $20 BILLION IN 2003, NEW SURVEY FINDS (PharmExec)

CMS ANNOUNCES IMPROVED EFFORTS TO REDUCE MEDICARE