Phia Group Media


Phia Group Media

Jason Ruhl
Jason Ruhl
Jason Ruhl's Blog

Empowering Plans: P39 - Everything's Bigger In Texas!

On May 7, 2018

In this episode, our hosts interview Third Party Administrator, visionary, and industry expert – Caprock Healthplans’ own Executive Vice President, John Farnsley – as we review some of his recent talking points, cover where he thinks the industry is headed, and dissect the biggest issues he thinks will impact everyone involved.

Click here to check out the podcast!  (Make sure you subscribe to our YouTube and iTunes Channels!)

The Complications Surrounding Intermittent FMLA Leave

On May 7, 2018

By: Erin Hussey, Esq.


The Complications Surrounding Intermittent FMLA Leave


The Family Medical Leave Act (“FMLA”) is a federal law requiring certain employers (employers who employ 50 or more employees, for at least 20 workweeks in the current or preceding calendar year, in a 75 mile radius), to provide eligible employees an unpaid, job-protected leave of absence that continues the employee’s health benefits. It is offered for family and medical reasons and an eligible employee may take up to 12 workweeks of leave in a 12 month period. This timeline appears straightforward, but complications arise when employees take this leave in separate blocks of time, even an hour at a time (when it is medically necessary and for the same serious health condition). This is called intermittent FMLA leave.


Employers should ensure they are administering intermittent FMLA leave properly given the complications it can present:


1.            Recordkeeping: Complications can occur with tracking intermittent FMLA leave because an employee’s schedule could vary from week to week and the employer may have to measure FMLA in hourly increments or less. When these intermittent FMLA leaves occur, an employer must be diligent in tracking the leave to avoid liability of non-compliance with FMLA. For example, in Tillman v. Ohio Bell Tel. Co., 545 F. App'x 340 (6th Cir. 2013), an employee was out on intermittent FMLA leave and the employee did not provide information when asked by the employer for recertification of that leave. The employer subsequently terminated the employee. Since the employer kept thorough records of this, the court upheld the employee’s termination and the employer won the lawsuit.


2.            Communication: It is important for an employer to maintain communication with the employee who is out on intermittent FMLA leave. For example, in Walpool v. Frymaster, L.L.C., No. CV 17-0558, 2017 WL 5505396 (W.D. La. Nov. 16, 2017), the employee was terminated and he brought suit claiming interference with his intermittent FMLA leave and that his discharge was in retaliation of his right to take FMLA leave. The employer claimed that the employee did not follow normal policies and procedures for giving notice of an absence. However, the employee won the case. The bottom line here is that if the employer believes the employee has provided inadequate notice, the employer should maintain communication with the employee before taking any immediate adverse action.


3.            Paid v. Unpaid: In a recent Opinion Letter dated April 12, 2018, the Department of Labor’s Wage and Hour Division addressed a situation where an employee requested 15 minute breaks every hour under FMLA. This creates complications for employers because FMLA is unpaid and determining which 15 minute breaks are unpaid under FMLA, and which ones are paid, can be difficult for employers to track. This issue is discussed in the Opinion Letter.


The takeaway here is that employers should determine what their best practices will be for administering intermittent FMLA properly. Once the employer determines what their best practices are, the employer should implement them and administer their employees’ intermittent FMLA leaves accordingly.

North Cypress Medical Center: What Does it Mean for RBP?

On May 2, 2018

By: Jon Jablon, Esq.

If you’ve dabbled in reference-based pricing, or RBP, then you know about the legal and business challenges involved. From the inability to compel providers to bill reasonably to the difficulty in settling at a mutually-agreeable rate, RBP is tough. There’s a lot to it, and the law has always been on the side of the providers, making fighting the good fight just that much more difficult.

Recently, however, the Texas Supreme Court (in In Re North Cypress Medical Center Operating Co., Ltd., No. 16-0851, 2018 WL 1974376 [Tex. Apr. 27, 2018]) has ventured a change from its historical position, and has indicated that “…because of the way chargemaster pricing has evolved, the charges themselves are not dispositive of what is reasonable, irrespective of whether the patient being charged has insurance.” Historically, Texas courts have opined that the chargemaster is somehow the reasonable price of services.

This case indicates that evidence of accepted rates (from all payers) is in fact relevant to determining the reasonable value of medical services; although this case doesn’t actually determine the reasonable value or assign any relative weight to the amounts paid, it is a stepping stone that RBP plans can use to try to enforce their payment amounts and perhaps induce more reasonable settlements.

To be sure, the court indicated that “[t]he reimbursement rates sought, taken together, reflect the amounts the hospital is willing to accept from the vast majority of its patients as payment in full for such services. While not dispositive, such amounts are at least relevant to what constitutes a reasonable charge.” In other words, amounts the hospital accepts from all payers are relevant – but “not dispositive,” such that no one accepted amount is conclusively considered reasonable simply by virtue of having been accepted in the past. The Texas Supreme Court’s opinion that those amounts are even relevant, however, is a big step, and presents RBP plans with a valuable tool.

According to the court, “[w]e fail to see how the amounts a hospital accepts as payment from most of its patients are wholly irrelevant to the reasonableness of its charges to other patients for the same services.” We concur! This decision gives health plans some ammunition to counter the popular hospital opinion that Medicare rates are not relevant (since arguably they’re not “negotiated” but are instead forced upon the hospital by the government). We have always argued that no hospital is required to accept Medicare payments, but hospitals choose to because presumably those payments are valuable and worthwhile; we expect this case to help the argument that Medicare rates must be considered relevant when determining reasonable value – and the chargemaster rates themselves are all but meaningless.

The Fax Machine and a Lesson in Incentives

On April 30, 2018

By: Brady Bizarro, Esq.

Let’s face it: fax machines are horrible and outdated. From busy signals to unreadable printouts to incorrect destinations, it is no wonder most industries abandoned them last century. In our industry, which deals extensively with providers, it’s the primary way to communicate. Understanding why can give you a glimpse into the broader problems with healthcare policy in this country today; a misalignment of economic incentives.

Almost all providers have digitized their own patient records. This was done largely thanks to the Obama administration. In 2009, as part of the stimulus bill, the government passed the Health Information Technology for Economic and Clinical Health Act (the “HITECH Act”), which included nearly $30 billion to encourage providers to switch to electronic records. Statistics reveal that the number of hospital systems using electronic records went from nine percent in 2008 to eighty-three percent in 2015. So far so good. So, what went wrong? Why is the fax machine still the primary way doctor’s offices communicate?

The issue is not digitizing records: the issue is sharing them. When doctors want to retrieve patient records from another doctor’s office, they turn to the fax machine. They print out records, fax them over to the other provider, and that office scans them into their digital system. Needless to say, this is inefficient, and a misreading of economic incentives is to blame.

The government, at the time, assumed that providers would volunteer to share patient data amongst themselves. This data, however, is considered proprietary and an important business asset to most providers. If other hospital systems could easily access and share your medical record, you could more easily switch providers. Switching providers may be a good thing for a patient who is shopping for better value care, but most providers perceive this ability as a threat to steerage. After all, hospital systems compete with one another for steerage.

As in the case of other healthcare policy problems, chief among them out-of-control spending, doctors, nurses, patients, lawmakers, everyone is frustrated; yet, a solution has thus far been out of reach. The proposed solutions divide policymakers among ideological lines as is often the case with healthcare spending: some feel that more government regulation is needed; others feel that fewer regulations are needed. The Trump administration has so far proposed deregulation in this area and giving patients more control over their own medical records. This is one of the four priorities recently accounted by the Department of Health and Human Services (“HHS”). Time will tell if this approach will finally lead to the demise of one of the most despised pieces of technology in medicine.

Senate Health Committee Hones in on Mental Health Parity Enforcement

On April 26, 2018

By: Patrick Ouellete, Esq.

Though stakeholders in the self-funded health plan industry may not be following Mental Health Parity and Addiction Equity Act (MHPAEA) enforcement with the same vigor as perhaps the Affordable Care Act (ACA), these entities should be aware of recent efforts in Congress to strengthen mental health parity among plans.

Six members the Senate Health Committee recently sent a letter to Department of Health and Human Services (HHS) Secretary Alex Azar contending that the current administration has not enforced equal treatment of mental health disorders and substance abuse in insurance plans. Along with the uncertain status of the ACA, this bipartisan effort highlights the uneven regulatory ground in which MHPAEA currently stands.

Under MHPAEA, self-funded health plans are not required to offer coverage for mental health and substance abuse. If they do choose to offer coverage, however, the plan must cover mental health and substance abuse in parity with the major medical benefits, such as same copay or coinsurance. MHPAEA was a provision 21st Century Cures Act, which had required that HHS, the Department of Labor (DOL), and Department of Treasury develop an enhanced enforcement plan and guidance by December 13, 2017. From there, Congress was to use agency recommendations to continue to put more teeth into MHPAEA enforcement.

Since no plan has been issued to date, the Senate Health Committee members’ letter to HHS, DOL, and the Treasury focuses on what the agencies have done to improve parity by, for example, taking action on non-qualitative treatment limits as well as a timeline for ratcheting up enforcement activity. The committee requested a response by May 1, 2018.

The letter’s questions and commentary are significant for the self-funded industry because both Republicans and Democrats in the Senate have not forgotten about MHPAEA even though December 13, 2017 has passed. Plans that are subject to its requirements if they cover mental health and substance abuse should take note of Senate Health Committee. Looming in the background is the Government Accountability Office, which the committee stated will be following the agencies’ respective responses carefully.

Empowering Plans: P38 - A Labor of Love?

On April 24, 2018

In this episode, Adam, Ron, and Brady interview in-house specialist, VP of Consulting Attorney Jennifer McCormick, and discuss the many complicated issues surrounding surrogacy, and the costs for which benefit plans may be responsible.  What can be denied?  What must be paid?  Why is this a threat?  What can we do to avoid it, or at least minimize the risks?  Listen and find out!

Click here to check out the podcast!  (Make sure you subscribe to our YouTube and iTunes Channels!)

4 Horsemen of the Plan-pocalypse

On April 19, 2018

Nostradamus?  Miss Cleo?  The Phia Group?  In a psychic feat of foresight, The Phia Group’s team has gazed into their crystal ball and identified four issues that may not presently be keeping you up at night, but will certainly be disturbing your slumber very soon.  From being forced to pay for surrogate pregnancy and births, to the IRS actively issuing letters notifying employers of 2015 tax year penalties; from a new wave of fraud, errors, and abuse leading to heretofore unseen overpayments, to case law addressing the rights of plans to utilize reference based pricing – you’ve been warned!  We predict this complimentary webinar will open your eyes.  Miss this webinar at your own peril… You’ve been warned!

Click Here to View Our Full Webinar on YouTube

Click Here to Download Webinar Slides Only

Empowering Plans: P37 - Arresting the Financial Serial Killers

On April 18, 2018

Today Adam and Ron interview the industry, and nationally, renown Dr. Keith Smith of the Surgery Center of Oklahoma.  This pioneer of transparent pricing and forefather of the Free Market Medical Association waxes poetic regarding everything from issues with provider pricing, the status of medicine today, and his predictions for the future of health care.  If you don’t think surgeons can offer a clear and transparent price for care before they provide the treatment is provided, listen to this episode and prepare to be shocked!

Click here to check out the podcast!  (Make sure you subscribe to our YouTube and iTunes Channels!)

Stories from the Front Lines…

On April 17, 2018

By: Chris Aguiar, Esq.

I fight for the rights of my clients every single day.  Typically, though, the fight takes place while sitting in the confines of my office by way of telephone or email communication.  Recently, though, it has become increasingly more common for The Phia Group to have to actually appear in court in front of a judge or administrative board; such was the case last week.  An administrative worker’s compensation board in California who is constantly attempting to reduce its workload and eradicate the existence of worker’s compensation liens they so lovingly refer to “Zombie Liens”, or liens that have been bought/sold/assigned.  Simply, the board refuses to want to deal with those types of liens.  What a surprise to me, then, when several of my clients had their liens summarily dismissed without any due process or a hearing on the matter since, as we know, no assignment of rights occurs to the administrator or vendor in a traditional self-funded situation.  So, off to California I went on behalf of a client to explain to the board it’s fundamental misunderstanding of self-funding and how the interests of our clients have not been sold or assigned to The Phia Group or the claims administrator, rather, we are simply acting on their behalf in an effort to recoup funds that are rightly of the self-funded benefit plans and their beneficiaries.

Make no mistake, this was no easy task.  The Administrative Judge was hell bent on removing our client’s lien and though I don’t think I made any allies, I was able to effectively convince her that the lien should be reinstated because although she was confident that her reading of the law was clear, members of her own organization had ruled all over the map with regard to the law that was so abundantly clear it could not possibly be interpreted in a manner inconsistent with this judges opinion (…. Can you sense my sarcasm here?).

In the end, The Phia Group was able to get its 2nd lien in as many attempts reinstated.  We’ll keep fighting the good fight on behalf of our clients, and while I enjoy California very much, I hope to be able to win these from the comfort of our offices in Braintree from here on out.  Here’s hoping!

The Tangled Web of Eligibility

On April 11, 2018

By: Kelly Dempsey, Esq. 

In past blogs, we’ve looked at eligibility issues from the perspective of leaves of absence, continuation of coverage, and the subsequent gaps that can arise if the plan language is not clear. For this blog, we’ll back up a bit and look at the bigger picture.

Eligibility issues are typically very fact specific – meaning employers and TPAs have to look at the details of an individual’s situation in order to determine if someone can join the plan, modify enrollment, and/or leave the plan during the plan year. Joining the plan involves HIPAA special enrollment rights and plan obligations – the requirements are clearly defined. Special enrollment rules also come into play when an employee’s life situation changes and the employee seeks to add dependents to the plan. At first thought leaving the plan seems to be a no brainer situation – if the employee wants to leave, let them leave…right? Not so fast.

More often than not, health plan contributions are made pre-tax through a cafeteria plan. If a cafeteria plan is involved, the situation can get complicated with the additional consideration of permitted election change rules. Section 125 permitted election change rules can limit an employee’s ability to leave the plan or make other modifications to elections, such as changing the amount of an FSA contribution. To add one more layer, Section 125 is essentially a ceiling and not a floor – meaning it is up to the employers whether or not to include only some of the permitted election changes instead of all permitted election changes available under Section 125.

Now an employer and TPA not only have to review specific facts, but they have to apply two sets of rules and two plan documents (the medical plan and the cafeteria plan). For example, an employee asks the employer to drop health plan coverage saying that “it’s too expensive.” Without a change in status, cost change, or other situation outlined in the permitted election change rules, the employee could very well be stuck in the “web.”

It can be tricky to reconcile rules that overlap each other (side note, overlapping rules happen a lot in this industry…). If you need an extra set of eyes (since we aren’t spiders and don’t have 8), don’t hesitate to reach out to The Phia Group – our consulting team can help get you untangled.

Who knew eligibility could be so difficult?