By: Kevin Brady
In March of this year, the President signed the Families First Coronavirus Response Act (FFCRA) into law. The FFCRA represents the first major legislative response to the COVID-19 pandemic. In an effort to reduce the spread of COVID-19 and to protect the financial interests of those employees and families who are impacted by the COVID-19 pandemic, the FFCRA provides new and expanded leave entitlements under the Expanded Family and Medical Leave Act (EFMLA) and the Emergency Paid Sick Leave Act (EPSLA).
The EFMLA provides additional leave entitlements to employees who must take time off because they are unable to work (or telework) due to a need to care for a child in the event that the child’s school or place of child care has been closed or is unavailable due to the COVID-19 pandemic. Additionally, the Emergency Paid Sick Leave Act (EPSLA) requires employers to provide paid sick leave (up to 80 hours) to employees who are unable to work (or telework) for any of the following reasons:
Employers should note that the obligation to provide leave under the EFMLA and the EPSLA terminates at the end of the year. Although it is possible that these leave entitlements will be extended beyond December 31, 2020 there is no indication (as of right now) that they will be.
Although it may no longer be required, employers may consider voluntarily continuing these leave entitlements to their employees to mitigate the risk of potentially contagious individuals returning to work too soon. Another important consideration for employers who self-fund their medical plans is to confirm that their plan document is updated to reflect this change. If leave is allowed beyond the employer’s obligations and coverage is continued under the medical plan, the group will want to confirm that the stop loss carrier is aware of and approve the approach.
Following on the heels of their incredibly informative assessment of what to expect in 2021, The Phia Group will dives back into their pool of predictions in another free webinar. The team targets rules that will impact 2021, including the recently released transparent pricing rules. Additionally, they discuss some best practices developed and applied in 2020 and how those changes will assist plans in 2021. If success in 2021 is in your plans, check out this webinar and look forward to tomorrow.
Click Here to View Our Full Webinar
To obtain a copy of our webinar slides, please reach out to mpainten@phiagroup.com.
By: Jon Jablon, Esq.
There’s no question that most health plans can’t remain viable without a stop-loss policy in place. The plan and stop-loss carrier share a common goal, which of course is cost-containment. Since the two types of coverage provided are so different, however, the brand of cost-containment that each uses is often vastly different – and when two companies are trying to contain costs on the same claims, things can get ugly if they say different things.
Many stop-loss carriers have antiquated notions of what should constitute U&C. Common definitions include the old “usual charge in the area” language or some variation thereof, but many carriers have taken their policies into the modern age and use multiples of Medicare for their allowable amounts. In theory, this makes sense; just like a plan needs to determine what amounts are reasonable for it to pay for claims, so does a stop-loss carrier. However, plans should consider that their carrier’s idea of what is reasonable may not align with their own.
Admittedly, this is not the first time we have brought up this topic of so-called “gaps” in U&C language between a plan and a stop-loss carrier. That’s because this issue continues to be relevant, and what’s worse, payors are often surprised by stop-loss denials when they didn’t think they had any reason to worry.
The best example is when the plan is subject to a PPO contract, which most still are. The plan is contractually bound to pay the network rate, and cannot limit its payment based on a percent of Medicare or other factors; instead, it must pay providers the established contractual network rate. The stop-loss policy, however, doesn’t reference the PPO rate, instead saying that it will pay the lesser of (a) 200% of Medicare or (b) the usual charge in the area. Again – no mention of the PPO rate.
As is generally the case, and as is the impetus for the reference-based pricing boom, PPO discounts or DRG rates are far higher than what is considered reasonable by most payors, and are almost always higher than 200% of Medicare. The fact remains, however, that a plan subject to an applicable PPO agreement may be bound to pay those network rates, however unreasonable they may be considered. The carrier is not subject to the PPO agreement, however, and is free to disregard its terms – hence capping its own allowable based on Medicare or other factors.
So, what happens? The plan pays the network rate – billed charges less a meager percentage, usually – and the carrier adjudicates the claim without regard to the terms of the network contract, and allows its claim at 200% of Medicare. That leaves a hefty gap between what the carrier will reimburse and what the plan has paid – and in some instances the carrier’s opinion of the plan’s allowable amount may not even rise to the level of the specific deductible, rendering the claim denied in full since it hasn’t met the attachment point.
If this has never happened to you, good – but The Phia Group is in a prime position to have seen these issues pop up over and over again. In fact, one group even sued The Phia Group because the group’s stop-loss carrier denied a claim for this exact reason! It could be funny if it weren’t so sad.
Moral of the story? As we so often implore… read your contracts. Make sure you understand what your carrier is going to pay, and not pay, and how that aligns with the allowances in the SPD. It might surprise you what you find.
Feel free to contact us at PGCReferral@phiagroup.com if you’d like some assistance.
In this episode of Empowering Plans, Brady is joined by Attorney Andrew Silverio. They discuss current COVID-19 vaccine candidates and everything health plans and employers need to know about them. When can we expect the first vaccines to arrive? Do health plans have to cover them at full price? Can (or should) employers make this vaccine mandatory? Join us to find out.
Click here to check out the podcast! (Make sure you subscribe to our YouTube and iTunes Channels!)
By: Andrew Silverio, Esq.
We couldn’t possibly count the number of inquiries we have received over the years about extending coverage to “1099 Employees” under a self-funded ERISA health plan. So, it seems like a good idea to lay out some important concepts and issues that arise when discussing coverage under an ERISA plan for independent contractors. First, there is no such thing as a “1099 employee”. A 1099 worker is an independent contractor, which is by definition not an employee. This may seem like a distinction which is relatively meaningless and semantic, but the difference has significant practical consequences.
Whether a worker is properly classified as an independent contractor, who reports his or her income on a form 1099, or a true employee, who receives a W-2, is based on a multi-factor common law test. Importantly, this common law test and the resulting question of how a worker is properly classified is a legal and factual question – this is not something that can be decided by an employer by simply documenting someone as a contractor as opposed to employee, or negotiated between the parties. These factors include the amount of control the company has over the work, the financial relationship between the parties (beyond regular pay, who covers business expenses, provides necessary equipment, etc.), and the type of relationship. For example, is there a written contract governing the relationship? Is the relationship continuous or for a defined period or project? Does the worker receive benefits like vacation pay, health coverage, retirement benefits? This last point is important – whether or not a worker is provided benefits like health coverage is actually a factor in the common law test of how they should be classified, so if an employer is looking at providing health coverage to 1099 workers, it must be aware that doing so can actually tip the scales and render them common law employees (triggering all the related legal and tax considerations).
The ERISA plan sponsor wishing to extend coverage to independent contractors also has various hurdles to consider that an employer purchasing a fully-insured group policy does not – namely, how ERISA defines an “employee benefit plan.” Since independent contractors are not employees, covering them under an employee benefit plan, which exists for the benefit of employees and their dependents, can actually take the plan out of the realm of ERISA and into the realm of state law. This could occur because the plan, now covering its own employees as well as those of another employer (even if those persons are self-employed) may be considered a multiple employer welfare arrangement (MEWA), which is subject to state law and regulation by the local department of insurance. This would have serious repercussions for an ERISA plan, as one of the main benefits of that status is the broad protections from state law such plans enjoy.
While we always appreciate the desire to be more generous with benefits, in the self-funded world the issue becomes very tricky when it comes to non-employees. We would urge any plan sponsor to look carefully at all these different issues and consult with a local employment attorney with any questions about the proper classification of its workers.
For Immediate Release
11/21/2020
Canton, MA – The Boston Globe Names The Phia Group as a Top Place to Work for 2020.
It is with great honor and humility that The Phia Group announces it has been named by The Boston Globe as one of the Top Places to Work in Massachusetts. In its 13th annual employee-based survey, The Boston Globe – having assessed anonymous employee feedback, and details about the company – determined that The Phia Group provides one of the most rewarding, meaningful employment experiences in the Commonwealth of Massachusetts.
Each year, The Boston Globe publishes in its “Top Places to Work” issue, a list of employers it recognizes as being the most admired workplaces in the state, voted on by the people who know them best – their employees. The survey measures employee opinions about their company’s direction, execution, connection, management, work, pay and benefits, and engagement.
When the results were tallied and analysis was completed, The Phia Group was ranked #27 of the top 55 medium sized companies. “This was a particularly challenging year to be a great place to work, and the companies that made our list went above and beyond to keep their employees safe, engaged, and cared for,” said Katie Johnston, the Globe’s Top Places to Work editor. “From offering help with childcare to making the workplace more equitable, to holding virtual events, these employers showed that the best get better in crisis.”
The rankings are based on confidential survey information collected by Energage (formerly Workplace Dynamics), an independent company specializing in employee engagement and retention, from more than 80,000 individuals at hundreds of Massachusetts organizations. The winners share a few key traits, including offering progressive benefits, giving their employees a voice, and encouraging them to have some fun while they’re at it.
“This is one of the proudest days of my life.” The Phia Group’s CEO, Adam Russo, remarked. “I say this team is like family; but we don’t usually get to choose who is a part of our family. Our employees choose to be part of this family.
“Ensuring that people have access to the best health care at the lowest cost possible is our purpose. It’s what we provide to our clients, and it’s what we provide to our own staff.” Adam continued. “When your people are happy, your clients are happy. It’s not always the easiest or quickest path to success, but it is a lot more permanent.”
Additional information can be found at Globe.com/TopPlaces.
To learn more about The Phia Group, what it is doing to empower plans and enable all employers to be best places to work, please contact Garrick Hunt by email at ghunt@phiagroup.com or by phone at 781-535-5644.
About The Phia Group:
The Phia Group, LLC, headquartered in Canton, Massachusetts, and with offices in Hartford, Boise, and Louisville, is an experienced provider of health care cost containment techniques offering comprehensive claims recovery, plan document and consulting services designed to control health care costs and protect plan assets. By providing industry leading consultation, plan drafting, subrogation and other cost containment solutions, The Phia Group is truly Empowering Plans.
About Boston Globe Media Partners LLC:
Boston Globe Media Partners, LLC provides news and information, entertainment, opinion and analysis through its multimedia properties. BGMP includes The Boston Globe, Globe.com, Boston.com, STAT and Globe Direct.
The end (of 2020) is near, and we are anxiously looking forward to 2021. Between the Presidential Election, the COVID-19 Pandemic, and the ACA’s “Day in Court” before SCOTUS, any one of these ongoing topics would be enough to keep us busily planning for what is to come. Suggesting that 2021 is poised to be one of the busiest years in our industry’s history might be an understatement. At times, it may be overwhelming to keep up with everything that is impacting us – as employers, as service providers, and as human beings. That’s why The Phia Group is proud to invite you to enjoy another webinar, where we will be discussing these and other hot topics, forecasting what we expect to see in 2021, and giving you a head start as you – like we – plan, and look forward, to 2021.
By: Ron E. Peck
As I – like so many others – anxiously watched election day results on television, a commercial played more than once. The advertisement displayed a mask (not a fun Halloween mask, but rather, one of the protective masks with which we have all become familiar). The voice advises that this is a mask. It protects the wearer and others around them. It is not a political statement. It is a mask.
The advertisement struck me, but not for the reasons they likely intended. It moved me for two reasons. First, I was saddened that the message even needs to be sent. Second, I was even more saddened by the fact that the message was wrong. Love it or hate it, masks – like so many other things – have become a political statement.
This is one example of what I fear; the politicizing of health.
Many important decisions are made by politicians on a daily basis. Yet, there are some decisions that transcend politics. If a school is under siege by a shooter, police respond, rescuers do all that they can to save lives, and we all watch horror stricken. Yes, in the aftermath people will politicize every aspect of the tragedy; debating mental health, gun control, and the like. How did it happen? How can we prevent it? Yet, in the moment – as the emergency is unfolding – we set aside political rhetoric, unify, and act.
Today we are dealing with the COVID-19 pandemic. As with a school shooting, there is an emergency that is presently in effect. Some people question the numbers; how many people actually have the disease, how many fatalities are attributable to the disease, and so forth. Yet, everyone agrees that there is a disease, it is fatal for some, and there are certain behaviors we can alter temporarily to potentially reduce the risk. Whether you believe masks are effective or not, as an example, the cost of wearing one is small. In other words, if you think there is – at best – a 10% chance masks are effective, isn’t it worth it – even then? The point is that, when performing an objective cost-benefit analysis, the cost of engaging in some simple acts is so low, it’s worth engaging in those acts – even if you think the benefit is minimal.
Yet, once the act (or lack of action) is politicized, a thumb is applied to the scales and the cost is increased.
Masks and COVID-19 are one example. Looking at the bigger picture, health care in these United States of America is too expensive. Insurance premiums or contributions to self-funded health plans are too expensive – in part because they need to pay for the excessive medical bills, but also in part because premiums and contributions have become a privatized tax, whereby we all pool our money to cover costs arising from inefficiencies or losses elsewhere.
I absolutely believe payers can do more to reduce costs without negatively impacting the consumer experience. I absolutely believe providers can do more to reduce what they charge for care. I absolutely believe patients can do more to limit damages and through proactive measures reduce the burden they place on both payers and providers. Yet, as with masks, so too has health care – how it is accessed, administered, and paid – been politicized. Demanding that everyone assess their behavior, processes, and implement changes that will improve care, improve benefits, and reduce costs should not be a political issue. Yet, it has become one.
I have always believed that, before we fight over the pie, we should first identify ways to make the pie larger. Abraham Lincoln is credited with having said, “Discourage litigation. Persuade your neighbors to compromise whenever you can. As a peacemaker the lawyer has superior opportunity of being a good man.” Certainly providers will need to sacrifice some revenue, if the cost of care is to be reduced. How much profit can be salvaged, however, by first identifying and eliminating waste? Likewise, payers will reduce their incoming revenue when they cap premiums or contributions, however, they too can recoup those losses by adjusting their procedures, coordinating benefits with other payers, and delivering their services in a more focused, effective fashion. Lastly, patients need to be mindful of their own physical health, lest poor health should become financial crisis. Just as routine $50 oil changes avoid a $4,000 engine replacement, so too can patients take action to reduce the financial burden placed on the system.
Ultimately, the question of “how” we pay for health care should be subservient to the question of what health care should cost… and to answer that question, we need to first consider all that goes into determining what the price ought to be. The discussion of how we pay for health care may be political, just as deciding who will pay for dinner may be a matter for debate. Before my father and I argue over who can pick up the tab, however, let’s first ensure we were not charged for a cheesecake we most certainly didn’t order! That bit of common sense is certainly not political, nor should it be.
In this episode of the Empowering Plans Podcast, Ron Peck, Brady Bizarro, and Nick Bonds reunite to discuss their developing thoughts on the presidential election results. They speculate as to what moves a Biden administration can make on health care with a potentially Republican-controlled senate, and what effects those moves could have in the self-funded industry. They also discuss California v. Texas and try to anticipate how the Supreme Court might rule on the fate of the ACA. Lastly, they talk through the exciting news of a potentially viable coronavirus vaccine.
November 13, 2020
Canton, MA – In 2020, The Phia Group, LLC shocked the industry by announcing their intent to cover the entire cost of health benefits for their employees and families. Now, The Phia Group is pleased to announce that it will – in 2021 – continue to offer these no-cost benefits to employees and their families.
“This past year has been difficult for everyone. Between the pandemic, politics, and a complete lack of predictability, the one thing we don’t want our people to worry about is the cost of maintaining their own, and their families’ health,” remarked The Phia Group’s CEO, Adam V. Russo, Esq. “When we first implemented this program a year ago, our primary goal was to make health care more affordable for our team members – and we accomplished that mission; but that victory is almost outweighed by the residual benefits. Recruitment of the best talent has been substantially bolstered by this unrivaled benefit, retention of existing talent has never been better, and employee morale is up, despite the 2020 roller coaster. Not to mention how highly the company is now held in our employees’ spouses’ esteem – which is, of course, the true benchmark of success.”
Employees who have been in enrolled in The Phia Group’s self-funded health benefit plan for a fixed number of years will, upon renewing enrollment in 2021, have their contributions paid for by The Phia Group – including coverage for dependents. This remarkable achievement continues to be made possible thanks to the application and utilization of cost containment measures developed and provided by The Phia Group, combined with proactive efforts on the part of its own plan membership to be cost-conscious “consumers” of healthcare.
Ron E. Peck, Esq., Executive Vice President and General Counsel of The Phia Group explained, “2020 was going to be an experiment for us. We asked whether, by combining plan-based cost-containment efforts with member education, could we keep health care expenses at a level our plan could afford without shifting the burden onto our plan members and their families. The answer is ‘yes’.”
“We are very proud to be able to offer our employees and their families the types of benefits you’d be hard pressed to find anywhere else, and at the same time act as living proof that we can empower plans.” Adam concluded.
For more information regarding The Phia Group, it’s benefit plan, and the services that make these incredible results possible, please contact Garrick Hunt by email at ghunt@phiagroup.com or by phone at 781-535-5644. About The Phia Group: The Phia Group, LLC, headquartered in Canton, Massachusetts, and with offices in Hartford, Boise, and Louisville, is an experienced provider of health care cost containment techniques offering comprehensive claims recovery, plan document and consulting services designed to control health care costs and protect plan assets. By providing industry leading consultation, plan drafting, subrogation and other cost containment solutions, The Phia Group is truly Empowering Plans.