Phia GroupPhia Group Mediahttps://www.phiagroup.com/Media/PostsMinor Members and Third Party Settlementshttps://www.phiagroup.com/Media/Posts/PostId/1291/minor-members-and-third-party-settlementsBlog,ERISAMon, 27 Nov 2023 15:05:00 GMT<p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">By: Cindy Merrell, Esq. </span></span><br /> <b><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"><span style="color:#0070c0"><br /> Does a self-funded ERISA plan have a right of recovery from a minor’s third-party liability claim? </span></span></span></b><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"></span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">The answer is yes. However, there are various factors that can influence the Plan’s recovery in these circumstances. Federal courts across the country have recently considered a few challenges to a health plan’s right of recovery and clarified an ERISA plan’s right of recovery through reimbursement. What is abundantly clear is good plan language is vital to a health plan’s recovery. </span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><b><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"><span style="color:#4472c4">Who? What? When? Where?</span></span></span></b><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"></span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">Any subrogation professional is aware that good plan language is important to a plan’s successful recovery from the proceeds of a third-party settlement. <i>See </i><i>U.S. Airways, Inc. v. McCutchen</i>, 569 U.S. 88, 133 S. Ct. 1537 (2013). The Plan document must be crystal clear on the who, what, when, and where. The who can be answered in the plan document by defining the word “dependent” or “covered persons.” Next, the plan document must have strong subrogation and reimbursement language that addresses the remaining questions of what, where, and when. </span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">What rights does the plan have? Subrogation and reimbursement waters were muddied in certain jurisdictions by a decision that the plaintiff’s bar argument prohibited a plan from pursuing subrogation in third-party liability recoveries. <i>See Janssen v. Minneapolis Auto Dealers Benefit Fund</i>, 447 F.3d 1109 (8th Cir. 2006) (8th Cir. 2006). However, in a recent unpublished decision the 8<sup>th</sup> Circuit clarified that a plan with the appropriate reimbursement language can pursue a recovery through reimbursement from the proceeds of a third-party settlement. <i>See</i> <i>Vercellino v. Optum Insight, Inc.</i>, No. 20-3524 (8th Cir. Feb. 14, 2022). The court clarified that subrogation is not reimbursement and that they are two different rights. Reimbursement is a much broader right of recovery. <i>See id. </i>The difference is when does each right become effective? Subrogation allows the plan to step into the shoes of the member and assert a claim against the responsible party while reimbursement is a right of recovery from the settlement funds. </span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">Where can a self-funded ERISA plan enforce its right of recovery? In nearly all state jurisdictions a state court must approve a minor’s settlement through the state’s probate court. This process is designed to protect the minor’s interest. Typically, once the court approves the distribution of the settlement including the portion of the funds owed back to a health plan, the funds are placed in a blocked account to be released once the minor turns 18. On its face, it appears that the state court through the probate process is where the plan’s portion of the settlement is determined. However, a federal court in Florida confirmed it has the exclusive jurisdiction of a self-funded ERISA plan’s claims for a reimbursement or equitable lien by agreement. <i>Publix Super Markets, Inc. v. Figareau</i>, Case No: 8:19-cv-545-T-27AEP (M.D. Fla. Mar. 17, 2020). </span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"></span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"></span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"></span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><b><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif"><span style="color:#4472c4">How to enforce the Plan’s right of recovery?</span></span></span></b></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">Even with the strongest language a probate court may not be aware of the strong right of recovery of a self-funded ERISA plan. If an agreement cannot be made with the minor member’s attorney regarding the reimbursement amount to the Plan, it may become necessary for the health plan to retain local counsel to represent the health plan’s interest at a probate court. Another possibility is if the employee is still on the health plan, the plan could consider offsetting the member’s future benefits so long as the plan language supports this option. </span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">In conclusion, a self-funded ERISA plan can seek recovery from settlement funds with the appropriate plan language. The Phia Group has set the gold standard for strong recovery language. Please contact The Phia Group if your health plan needs any assistance with a minor’s subrogation or reimbursement matters. </span></span></span></span></span></p> <p style="text-align:justify; margin:0in 0in 8pt"><span style="font-size:11pt"><span style="line-height:normal"><span style="font-family:"Calibri",sans-serif"><span style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">Please note this article is not intended to be a comprehensive review of all health plans’ rights of recovery as various factors could impact the applicability of the above statements.  For a more detailed analysis of a specific matter please contact The Phia Group.  </span></span></span></span></span></p> 1291Empowering Plans: P102 – CYA: Cover Your Assetshttps://www.phiagroup.com/Media/Posts/PostId/1042/empowering-plans-p102-cya-cover-your-assetsPodcastsFri, 12 Feb 2021 13:54:30 GMT<p><iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/OcUDb5T09hk" width="560"></iframe></p> <p style="text-align: justify;">In this episode of the Empowering Plans podcast, Nick and Brady talk through some developing trends in ERISA litigation. Do fiduciary duties apply to the protection of plan data? Could a data breach lead to claims under ERISA and HIPAA? What steps do ERISA fiduciaries need to take? Listen in as we explore where things stand, and where they might be heading.</p> <p style="text-align: justify;"><a href="https://youtu.be/OcUDb5T09hk">Click here to check out the podcast!</a>  (Make sure you subscribe to our <a href="https://youtu.be/OcUDb5T09hk">YouTube</a> and <a href="https://itunes.apple.com/us/podcast/the-phia-groups-podcast/id1246462552?mt=2">iTunes </a>Channels!)</p> 1042Independent Consultation & Evaluationhttps://www.phiagroup.com/Media/Posts/PostId/388/independent-consultation-evaluationPress ReleasesTue, 22 Nov 2016 13:43:17 GMT<span style="font-size: 18px;"><strong>The Phia Group, LLC Officially Announces the Release of its New &ldquo;Independent Consultation &amp; Evaluation&rdquo; (ICE) Service</strong><br /> <br /> Braintree, MA &ndash; The Phia Group has for more than a decade been a source of document review, claim analysis, and regulatory compliance consultation for the health benefits industry. Today, statutory changes are occurring with greater frequency, and the industry needs objective analysis and expert consultation now more than ever before. <br /> <br /> Unfortunately, hourly billing (the method by which most legal consultants charge clients) tends to be difficult to budget, predict, and afford. Rather than force clients to choose between dealing with open ended invoices and addressing difficult situations without assistance, The Phia Group now offers a consultation service featuring a per-employee per-month subscription fee.<br /> <br /> &ldquo;From business development and third party contract review to the application of ambiguous plan exclusions in unusual circumstances, you need legal consultation. To address regulatory compliance concerns, claim processing queries, and to collaborate on difficult administrative tasks, having an experienced team of attorneys and industry experts on call is a must have,&rdquo; remarked The Phia Group&rsquo;s CEO, Adam V. Russo, &ldquo;The Phia Group understands, however, that the cost can be prohibitive &ndash; until now.&rdquo;<br /> <br /> The Phia Group&rsquo;s Senior Vice President and General Counsel, Ron E. Peck, remarked, &ldquo;We believe that we are all ethically obligated to seek out objective, professional feedback in response to difficult situations. When the cost of such aid increases as the time spent on the matter extends, those who bill by the hour are rewarded for delays, and clients are punished for seeking out thorough review. The Phia Group opposes that inherent conflict of interest.&rdquo;<br /> <br /> With an ICE subscription fee, clients can preemptively budget for and share the cost of this invaluable resource &ndash; allowing The Phia Group and their clients to focus on what is really important &ndash; results.<br /> <br /> For more information regarding ICE and The Phia Group&rsquo;s many other services, please contact The Phia Group&rsquo;s Sales Executive, Garrick Hunt, by email at <strong><a class="ApplyClass" href="mailto:ghunt@phiagroup.com?subject=Independent Consultation &amp; Evaluation Service">ghunt@phiagroup.com</a></strong> or by phone at <strong>781-535-5644</strong>.<br /> <br /> </span>388Independent Consultation & Evaluation: ICE, ICE, Baby!https://www.phiagroup.com/Media/Posts/PostId/384/independent-consultation-evaluation-ice-ice-babyWebinarsThu, 22 Sep 2016 20:16:17 GMTOur industry is plagued by issues related to compliance, contracts, and cost-containment &ndash; and a myriad of other legal issues as well. Engaging an expert for a second set of eyes is a chore in itself, requiring approval from management or an individual group as well as a cost-benefit analysis of the expert&rsquo;s fees &ndash; sometimes resulting in the decision not to consult a neutral third-party at all.<br /> <br /> The Phia Group has been providing consulting services since its inception seventeen years ago. We have seen thousands of problems that could have been mitigated or avoided entirely by consulting an expert. As a result, we have created the ICE service &ndash; short for Independent Consultation and Evaluation.<br /> <br /> Thank you for joining The Phia Group&rsquo;s legal team on September 22, 2016 at 1:00pm (EST) as they discussed some of the problems facing the self-funded industry today, provided examples of situations where being proactive rather than reactive would have been beneficial, and presented the value that ICE can hold for TPAs and health plans.<br /> <br /> <a target="_blank" href="/Portals/phiagroup/webinars/Sept2016/ThePhiaGroup - ICE ICE Baby - 9-22-16.pdf">Click here to download the slides.</a><br /> <a href="/Portals/phiagroup/webinars/Sept2016/ThePhiaGroup - ICE ICE Baby - 9-22-16.mp3">Click here to download the audio.</a><br /> <a href="/Portals/phiagroup/webinars/Sept2016/ThePhiaGroup - ICE ICE Baby - 9-22-16.mp4">Click here to download the video.</a><br />384Back to Basics: Plan Documents 101 (Part 2)https://www.phiagroup.com/Media/Posts/PostId/381/back-to-basics-plan-documents-101-part-2WebinarsWed, 13 Jul 2016 14:37:17 GMTWhen we think of hot topics in the self-funded industry, plan document drafting is hardly the first thing that come to mind. Instead, issues such as fiduciary duties, reference-based pricing, transgender coverage, employee incentives, and provider abuse are on the tip of everybody's tongues. All these topics, however, share a common feature: they're all reflected, in some way or another, within the plan document. Without compliant and effective plan document language, a plan can't offer robust benefit programs while containing costs.<br /> &nbsp;<br /> Thank you for joining The Phia Group's legal team (including Jen McCormick) on Wednesday, July 13th, 2016, at 1:00pm (EST), as we presented Part 2 of our "Back to Basics: Plan Documents 101" presentation. We discussed some more of the best and worst practices for plan drafting, to help you make the most of every page of your plan document.<br /> <br /> <a target="_blank" href="/LinkClick.aspx?fileticket=cbsLfKJ3yG8%3d&amp;portalid=586">Click here to download slides.</a><br /> <a href="/Portals/phiagroup/webinars/Jul2016/ThePhiaGroup - Back to Basics - Plan Language 101 - Part 2.mp4">Click here to download video.</a><br /> <a href="/Portals/phiagroup/webinars/Jul2016/ThePhiaGroup - Back to Basics - Plan Language 101 - Part 2.mp3">Click here to download audio.</a>381Back to Basics: Plan Language 101https://www.phiagroup.com/Media/Posts/PostId/378/back-to-basics-plan-language-101WebinarsWed, 15 Jun 2016 18:51:56 GMTMost situations that involve self-funded benefit plans revolve around language within the plan document. Whether deciding if a service is experimental, or figuring out whether a dependent is actually covered, or deciding whether a leave of absence will extend coverage, the plan document controls in just about all situations. For that reason, it's all the more disastrous when poor plan language handicaps plans and TPAs. Like we always say, your rights are only as good as your language.<br /> <br /> Back by popular demand, The Phia Group's very own Jen McCormick was the star of this webinar, since nobody knows plan documents like Jen.<br /> <br /> Thank you for joining The Phia Group's legal team - and Jen McCormick - for an hour on Wednesday, June 15th, 2016, at 1:00pm (EST), as we went "back to basics" and discussed some best and worst practices for plan drafting, to help make sure your plans don't lose their rights by failing to claim them in the first place.<br /> <strong><br /> <a target="_blank" href="/Portals/phiagroup/webinars/June2016/The Phia Group_s June 2016 Webinar - Back to Basics - Plan Language 101.pdf">Download the Slides</a><br /> <a target="_blank" href="/Portals/phiagroup/webinars/June2016/The Phia Group_s June 2016 Webinar - Back to Basics - Plan Language 101.mp3">Download the Audio</a><br /> <a target="_blank" href="/Portals/phiagroup/webinars/June2016/The Phia Group_s June 2016 Webinar - Back to Basics - Plan Language 101.avi">Download the Video</a></strong>378