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Phia Group Media


The Stacks – 2nd Quarter 2020

On March 19, 2020

A Case Study In Savings: How The Phia Group is Offering Employees Free Healthcare

By: Philip Qualo, J.D.

 

The Founder and Chief Executive Officer (CEO) of The Phia Group, LLC, Adam V. Russo, Esq., made an announcement at our most recent Christmas party that caused a reaction that could be heard all throughout the New England region. An overwhelming explosion of applauses, screams, and in some cases, tears and sobs, shook the entire venue as the CEO described a major milestone that made Phia history. What was this groundbreaking announcement? The Phia Group has joined the ranks of only a handful of employers in the United States that offers free healthcare… yes… FREE… healthcare coverage to their employees! Despite astronomical increases in healthcare and prescription drug costs throughout the nation, and soaring insurance premiums, Phia now offers free healthcare coverage to all employees who have been enrolled in the group health plan for a period time. We did this without raising out-of-pocket costs or employee contributions!

Six months before this announcement, when the CEO first considered offering free healthcare, I was tasked with identifying other employers that offer free healthcare, and more importantly, how they did it. Although identifying employers that offered some variation of free healthcare was an easy task, since there are approximately only ten or eleven employers currently doing this, what we could not find was information on how they did it. Consistent with our stated mission to reduce the cost of healthcare through innovative technologies, legal expertise, and focused, flexible customer service, we have decided to break away with this tradition of mystery and intrigue and share with the world how we accomplished this milestone. This is how we did it…

To Insure … or Self-Insure?

Our journey started many years ago when we decided to self-insure our employer-sponsored group health plan. We realized early on that choosing the right type of health insurance would be an essential part of the growth and long-term success of our company. The Phia Group started with a handful of employees twenty years ago, and now, we have several offices throughout the country. But when Phia was still a seedling, we knew that the key to our success hinged on not only attracting top talent to our workforce, but more importantly, retaining them. As healthcare is one of the top factors employees consider when they assess their employment satisfaction, we knew the key would be to offer a robust health plan that would appeal to a wide demographic of diverse individuals. With healthcare costs skyrocketing, however, we weren’t sure how to accomplish this without annihilating our budget.

Ultimately, we decided to take the risk and self-insure our group health plan. We realized that by self-insuring our own group health plan, we could avoid the off-the-shelf price tag sticker shock of a fully-insured plan, and have the flexibility to customize our benefits to meet the specific needs of our growing employee population. Unlike traditional health insurance plans which require employers to pre-pay for potential claims through monthly premiums, self-insuring our health plan provided us with a wide range of saving opportunities as we were only required to pay claims as services were rendered. By choosing a benchmark that met the needs of our workforce, we were able to cut out the wasteful benefits we do not need to keep our costs low. The savings allowed us to add more desirable benefits to our health plans that kept our employees not only healthy, but more importantly, happy. Healthy and happy employees are more likely to be more productive and stay with their employer even in the most competitive of job markets.

Maximize Savings

So we decided to self-insure … what next? Since our goal was to enhance our savings potential, with the hope of one-day passing along the savings to our workforce, our next step was to develop the most effective and clear plan language that would minimize our risk and liability while keeping our expenditures low. We wanted to accomplish this, however, without stripping our plan of the benefits are employees have grown to enjoy. To meet this goal, we developed our own plan design and incorporated the most innovative cost-containment techniques, working within the boundaries of our network agreement, and integrated them into our group health plan in easy to understand language aimed at educating our participants to ensure they utilize the high quality lower cost healthcare options. For example, our plan rewards employees for making cost-effective decisions by waiving co-pays when utilizing the reasonably priced yet effective facilities, generic prescription drugs and other low cost alternatives. Finally, to avoid the financial pitfalls of excess or erroneous payments, we created and adopted some of the strongest subrogation plan language in the country that further empowered our plan to identify more claim recovery opportunities as well as maximize our those recoveries.

Empower the Plan … Empower the Employees

Another benefit of self-insuring that played a role in our ability keep our costs low was access to our claims data. In the fully-insured world, carriers traditionally raise rates annually with little to no explanation. Since carriers are not required to provide employers with claims data, fully-insured employers are basically left powerless to develop strategies to keeping their premiums low. Information is power. Because we self-insure, we enjoy complete access to our claims data and rely on this vital information to identify wastes, high expenditures, and develop innovative and unique ways to save costs on an annual basis. However, we were still not satisfied.

As an industry expert in the self-insured arena, we knew there was more we could do as a plan sponsor to maximize our savings even more, but we knew we could not do this alone. We realized that without the support of our employees, our efforts to enhance our group health plan savings could only go so far. Without employees, a group health plan is nothing but a Plan Document/Summary Plan Description. So how do we get employees interested in, and more importantly, excited about keeping plan expenses low by opting for high quality low cost options? We wanted to be able to maximize options for our employees without dictating their healthcare needs or placing restrictions on our health plan.

The lightbulb went on – rather than dictate or limit healthcare options – we decided to incentivize our employees towards high quality low cost care options. We developed a broad range of employer cost-containment incentives aimed at educating our employees about their healthcare options with an irresistible incentive – a percentage of the savings! For example, by simply consulting with our Human Resources department before selecting a provider for certain procedures, a participant is eligible to receive a percentage of the savings that may result from the consultation. We also created a plan option with a Direct Primary Care (DPC) feature that is paid for company and completely free to our employees – no copays and no out-of-pocket when utilizing our DPC – ever! As an employer invested in our workforce, we always strived to keep our employee contributions low. However, by incentivizing employees to make cost-effective decisions about their healthcare needs and keeping their contributions low, employees not only became interested in keeping our health plan costs low … they became obsessed! In their mind, they were in it for the incentives – extra cash for picking the best care at the lowest cost? Why not?

Passing It On

What our employees did not realize until our most recent Christmas party, however, is that by utilizing our cost-containment incentives we covertly evolved into a work culture with a shared commitment – keeping our health plan costs low. To our employees, our incentives were just opportunities to get some extra funds or save some money while still accessing the best healthcare. With a strong group health plan, and plan participant’s eager to reap the rewards of our cost-containment incentives, our dream became a reality. Our group health plan savings had maximized to a point that we are now able to offer our employees a benefit that few companies provide … free healthcare coverage.

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Utah Goes to Mexico – A First for Drug Importation

By: Brady Bizarro, Esq.

 

Much ink has been spilled about prescription drug importation as a strategy for combating America’s exorbitant drug prices. Despite this practice being technically illegal, many self-funded plans have engaged in it for years without facing any repercussions. With Congress and the Trump administration still unable to agree on a drug pricing reform bill, these programs will almost certainly become more widespread. As they proliferate, they are likely to attract more scrutiny from the Food and Drug Administration (“FDA”), which, although it has rarely enforced the law in this area, has recently taken action against vendors engaged in drug importation. One large insurer, the state of Utah, has become the first to deliberately adopt a type of drug importation program which is much less likely to attract the attention of the FDA and might serve as a roadmap for other self-funded plans in search of relief.

The Legality

There are two traditional types of drug importation: mail order and pharmacy tourism. By and large, most self-funded plans engage in mail order drug importation: that is, they partner (directly or indirectly) with a vendor that assists plan participants in obtaining a drug from outside of the country by U.S. mail. All forms of drug importation are illegal under federal law. The Food, Drug, and Cosmetic Act (“FDCA”), codified as 21 U.S.C. §§ 301 et seq., broadly prohibits the importation of prescription drugs. The statute specifically prohibits the importation or introduction of any “new drug” into interstate commerce which has not been approved by the FDA, any prescription drug not labeled as required by federal law, or any prescription drug dispensed without a valid prescription written by a licensed American practitioner. See 21 U.S.C. § 355; 21 U.S.C. § 352, 353; 21 U.S.C. § 353(b).

Federal law considers a drug to be misbranded if, at any time prior to dispensing, the label of the drug fails to include the symbol “Rx only.” See 21 U.S.C. § 353(b)(4)(A). Drugs that are dispensed by international pharmacies do not bear this label. For example, Canadian pharmacies label their drugs with the tag “Pr,” as opposed to “Rx only,” and federal law does not consider these labels to be functionally equivalent. Therefore, even drugs that are manufactured abroad with the same chemical composition as their U.S. counterparts are considered illegal to import because of these strict labeling requirements.

Selective Enforcement

Although the practice is technically illegal, it appears that enforcement is selective, particularly when small amounts of prescription drugs imported for personal use are involved, either via U.S. mail or in baggage. According to the FDA’s own website, it does not typically object to the personal importation of unapproved drugs when all of the following conditions are met: the drug is for use for a serious condition for which effective treatment is not available in the United States; there is no commercialization or promotion of the drug to U.S. residents; the drug does not represent an unreasonable risk; the individual importing the drug verifies in writing that it is for his or her own use and provides contact information for the treating physician or shows that the product is for the continuation of treatment begun in a foreign country; and, generally, no more than a three-month supply of the drug is imported. See http://www.fda.gov/AboutFDA/Transparency/Basics/ucm194904.htm.

While individual consumers may reasonably rely on the FDA’s selective enforcement in this context, a company maintaining a business model or a self-funded plan utilizing a drug importation program might not. When the FDA has acted, it has been against companies engaged in or assisting with the importation of drugs through the U.S. mail. For example, on February 26, 2019, the FDA issued a “Warning Letter” to CanaRx, a vendor which administers a popular drug importation program to self-funded employers and their covered participants. See https://www.fda.gov/ICECI/EnforcementActions/WarningLetters/ucm632061.htm.

Though this mail order program, the vendor essentially acts as an agent connecting patients to foreign pharmacies in “Tier 1” countries - those which meet certain standards in drug regulation - which ship the foreign version of a prescription drug directly to the patient. The patient’s health plan is then invoiced for the cost. The FDA’s warning letter asserts that this mail order program violates numerous provisions of federal law. While CanaRx responded to the warning letter defending the legality of its program, the position taken by the FDA with respect to mail order drug importation is consistent with similar enforcement actions the FDA has taken in the past. 

Utah’s Pharmacy Tourism Program

In contrast with using mail order drug importation programs, the state of Utah has become the first large health insurer to utilize a pharmacy tourism drug importation program. Implemented in 2019, the program has already saved the state nearly $250,000, according to the plan’s managing director. Due to the program’s avoidance of the U.S. mail system, carefully crafted policies and procedures, and narrow criteria for eligibility, it appears far less likely to attract the attention of the FDA than typical mail order programs.

Utah’s Public Employee Health Plan is self-funded and self-administered, covering roughly 160,000 individuals. The state had been considering various options to deal with skyrocketing drug costs. It decided against using a mail order program and instead opted for a pharmacy tourism model. In 2019, it implemented a voluntary Pharmacy Tourism Program which is offered to patients taking one or more of thirteen specialty drugs, dealing mostly with rheumatoid arthritis, multiple sclerosis, and other serious, chronic conditions. The program currently covers approximately 400 people.

As part of the program, the plan pays its plan participants to fly to either San Diego, California or Vancouver, Canada. If they are headed to Mexico, the plan pays to drive them to a specified hospital in Tijuana to pick up a 90-day supply of medicine. A representative from a specialty pharmacy escorts the plan participant across the border and stays with the individual at all times. If necessary, the plan also covers lodging costs. Plan participants still pay their usual copayments and are incentivized to participate in the program through a $500 cash incentive. The plan works with a designated hospital to coordinate travel and arrange for the purchase of the drugs. Throughout this process, the plan tracks the medications from the manufacturer to the pharmacy to the patient, increasing the likelihood that the integrity of the chain of custody is maintained.

In reviewing the FDA’s previous enforcement actions, it is clear that the integrity of the chain of custody is one important factor in determining whether the agency will scrutinize any particular drug importation program. The agency seems more concerned about programs that involve introducing foreign drugs into the U.S. mail system than it is about individuals acquiring foreign drugs at the point of sale and carrying them across the border. With mail order programs, such as the one introduced by the state of Maine a few years back, there could be many entities mailing foreign drugs to individuals in the U.S. It would be very difficult for the FDA to track those entities and to ensure the integrity of the chain of command.

By contrast, with Utah’s program, an individual is completing the transaction in person at a designated facility and is accompanied by a representative from a specialty pharmacy. There is no middleman involved in transporting the foreign drug from the pharmacy to the individual, which significantly lessens the commercialization of the process. Also, scale matters in this context and for pharmacy tourism programs, utilization is lower than it would be for mail order programs (so far only ten plan participants have traveled to Mexico under Utah’s program).

As explained, all drug importation programs are technically illegal in the United States. There are no guaranteed approaches to avoiding FDA enforcement of federal law. Still, the FDA applies enforcement discretion and very seldom seizes incoming drugs or prosecutes individuals when the importation is conducted under the right circumstances. Politicians in Utah estimate that its pharmacy tourism program could save the state’s self-funded plan north of $1 million if more eligible individuals sign up. So long as bipartisan legislative reform remains just out of reach, self-funded plans will continue to pursue alternative approaches as cost-saving measures. If nothing else, these approaches are a constant reminder of a broken system in desperate need of repair.

The Phia Group's 1st Quarter 2020 Newsletter

On January 16, 2020


Phone: 781-535-5600 | www.phiagroup.com



The Book of Russo:
From the Desk of the CEO

 

Happy New Year everyone! 2020 marks the 20th anniversary of The Phia Group and it made me realize just how much we have accomplished and how far we have come. I am not going to sit here and tell you that this was the dream - to have a leading cost containment firm in the self-funding industry with over 200 employees. I just wanted to create something, anything that would change the status quo. I had no concept of the size of Phia, the revenues, the expertise, the reputation, the services, or the technology we have created.

I just had a passion to offer more than what was being offered at that time. I was 26, living in my mother’s basement, and basically had nothing to lose. We never got a loan, never had investors, never hired top talent - we couldn’t afford anyone!  What we had was a determination to have fun, disrupt and innovate. What we created after 20 years still boggles my mind.  I want all of you to know how much I appreciate the friendships, the loyalty and the collaboration we have built together. I will never forget where I came from or how I got here - thank you. Happy reading and I hope you all have an amazing 2020.  I know we will. 


Service Focus of the Quarter: Plan Appointed Claim Evaluator® (PACE)
Phia Group Case Study
Phia Fit to Print
From the Blogosphere
Webinars
Podcasts
The Phia Group’s 2020 Charity
The Stacks
Phia’s Speaking Events
Employees of the Quarter & Year
Phia News

 

We Are Proud to Announce: Free Health Benefits for Phia Employees & Their Families

The Phia Group, LLC is pleased to announce that with the ringing in of the new year, it will be offering FREE HEALTH BENEFITS to employees and their families.  Specifically, plan participants that have been enrolled in the plan for five or more years will be enrolled in January of 2020 and have zero contribution or premium; 100% of the cost of their and their families’ membership is paid for by The Phia Group. Further, no plan participant’s contribution rate will increase in 2020.

This remarkable achievement is made possible thanks to the application and utilization of cost containment measures developed and provided by The Phia Group to the self-funded health benefits community, and proactive efforts on the part of its own plan membership to be educated, and cost-conscious “consumers” of healthcare.

Adam V. Russo, remarked – in response to those that believe cost-shifting the burden of rising healthcare costs onto employees is inevitable – that, with the right tactics in place, health benefits can be affordable and employees do not need to bear the burden of an inefficient health plan.  “If our approach to health benefits didn’t work,” Adam continued,“… could we afford to maintain our contribution levels, year after year?  Could we continue to offer benefits with no co-pays or deductible?  The answer is no.”

Ron E. Peck, explained, “Our mission is to ensure health benefits are robust and affordable for hard-working Americans.  Very few people work as hard as our own employees, so providing them with the best, most affordable benefits is us living our mission.”

“We are very proud to be able to offer our employees and their families the types of benefits they’d only see at a very small number of businesses, nationwide;” Adam concluded.

 

Service Focus of the Quarter: Plan Appointed Claim Evaluator® (PACE)

Some years ago, in response to growing industry concerns over fiduciary duties and appeals, The Phia Group created its Plan Appointed Claim Evaluator (PACE) service. PACE is a risk-sharing service for final-level internal appeals. It is designed to help ensure Plans and their TPAs made correct determinations in response to appeals, thereby insulating the health plan from liability and allowing the Plan Administrator to focus on its core business rather than difficult fiduciary determinations.

PACE includes:

• Plan Document and stop-loss policy “Gap Reviews” ensure compliance, eliminate coverage gaps, and ensure PACE readiness;

• Advanced-level webinars exclusively for PACE clients;

• Assessment of eligible final internal appeals resulting in a written directive; and,

• Unsurpassed legal analysis, clinical review, and access to URAC-accredited IROs (and PACE covers all external review costs).

We also now offer complimentary PACE Certification – with which your organization can enhance your PACE business, improve your internal appeals processes, ensure regulatory compliance, and improve your operation as a whole.

Chapter One of PACE Certification explores the ins and outs of self-funding; Chapter Two takes a deeper dive into the laws and regulations applicable to self-funded health plans; Chapter Three explains what PACE is, how it works, and how it can best be utilized.

To learn more, contact Michael Vaz at mvaz@phiagroup.com or 781-884-4971.

 

Phia Case Study: Claim Negotiation & Signoff (CNS) 

The Phia Group was asked to negotiate a high-dollar claim on behalf of a self-funded health plan sponsored by a non-profit religious order. The charges totaled just over $100,000.00, and repricing yielded a Medicare rate of only $7,500.00 (a mark-up of over 1300% over Medicare). To compound the situation, the plan document had not been updated since the early 1990s, and had very weak language governing payment for out-of-network claims.

One of The Phia Group’s negotiators noted that the hospital bore the same name of the religious order of which the patient was an ordained member. After some investigation, Phia learned that this religious order was the very same that founded the hospital nearly a century ago.

In the initial outreach to the provider, we explained the claim’s metrics and equivalent Medicare rate; it was our hope that even without strong plan language or unloading our newfound argument regarding the member’s relationship to the hospital, the hospital would recognize the importance of settlement. Unfortunately, the provider was largely unresponsive to our efforts. After over a month of constant persistence in the form of calls, e-mails, and faxes, we finally received an offer from the provider to accept 35% off of billed charges. While not the smallest discount, that payment still would have constituted almost 900% of the applicable Medicare rate, and our client was not inclined to accept the offer.

In crafting a response, we got a little creative, and quoted some language directly from the “history” section of the hospital’s website. This patient, we noted, is a member of the religious order that founded this hospital back in 1922, and which transformed it into a hospital for children in 1936. That the hospital was now seeking almost 900% of the applicable Medicare rate from one of its founders seemed unreasonable and disingenuous. We also quoted a study that found that the average charge for an out-of-network claim in the state was 176% of Medicare; through this figure, we were able to base our client’s counteroffer in a concrete metric, even though the plan’s cost-containment language left much to be desired.

Ultimately, the provider agreed to accept our offer of 176% of the Medicare rate, and close its file. By going the extra mile, The Phia Group was able to save its client over $88,000; since the Plan Document didn’t have strong cost-containment language, the Plan would have legally been on the hook for the vast majority of it, had this settlement not been achieved.




 

Fiduciary Burden of the Quarter: New Denial Reasons on Appeal

It’s not uncommon for health plans to realize, while adjudicating a claimant’s appeal, that the initial denial reason was incorrect or incomplete. That’s one major function of appeals – to let a claimant identify that the denial reason is inapplicable. For instance, if the initial Adverse Benefit Determination denies a claim on the basis that the service is experimental, the claimant may appeal and present evidence that the claim is not in fact experimental. The fiduciary, when reviewing the appeal, may realize “whoops – this claim should have been denied for lack of medical necessity, but we used an experimental code by mistake!”

The result is generally that the fiduciary will still deny the appeal, but write that the claim is denied for medical necessity, rather than being experimental. The appeal is a request for additional benefits, but if additional benefits are not payable for some other reason that was not written in the initial denial, then the appeal should still be denied. Health plans often do not consider this to be a “separate” or “new” denial – but legally, it is.

Considering appeals to have been exhausted despite having provided a new denial reason effectively leaves the claimant with no opportunity to appeal that new denial for medical necessity. Courts have iterated that this is contrary to the intent and requirements of ERISA, which are designed to ensure that claimants are afforded the opportunity to appeal an adverse benefit determination. An appeal denial with a reason not previously given for that particular claim’s denial is therefore considered to be an initial adverse benefit determination all over again, even if given as part of a second-level appeal.

In short, any time a new denial reason is given for an existing claim, the claimant has the right to appeal that denial reason.

This could in theory create an absurd situation where the plan must accept many different appeals for the same claim – but to avoid that, we would suggest that the plan list all its denial reasons in the initial denial, when possible. That way, the plan can ensure that it does not need to respond to multiple unnecessary appeals, and also that a claimant is not strung along with the undue burden to appeal multiple times to try to get a straight answer out of her health plan.

 

Success Story of the Quarter: Balance-Billing at its Best!

The Phia Group was presented with a balance-billing claim from a client of Payer Compass’ INNOVATE360 service, for which The Phia Group provides back-end balance-billing support. This particular claim was billed at $1.57 million; the health plan allowed 150% of Medicare, which was about $289,000. The balance, billed in full to the patient, was nearly $1.3 million.

The TPA had been told prior to The Phia Group’s involvement that the maximum “discount” the provider would allow was 15%. Understandably, this payor would not accept that, and instead engaged The Phia Group to try to resolve this claim to alleviate the balance-billing. The payor was potentially willing to pay additional money to settle the claim, but certainly not the amount the provider was demanding.

The Phia Group engaged the provider, and right off the bat, attorney Rob Martinez unloaded all the arguments he had in his arsenal. They included arguments based on the ID card, the plan document, the hospital’s financial assistance policy, detrimental reliance, and more – and on a more personal note, the fact that this hospital was sending bills to its supposedly valued patient for $1.3 million.

Amazingly, the hospital conceded that Rob’s arguments were sufficient to extinguish the balance. The account was awarded a zero balance, and poof – just like that – Rob “the Magician” Martinez made a $1.3 million balance-bill disappear.

New Service Offered by Phia: Patient Defender

The Phia Group is proud to introduce its “Patient Defender” program. For a small PEPM fee, every plan participant has access to legal representation against lawsuits targeting patients, or crippling balances being sent to collections, when efforts to amicably resolve these disputes fail, Patient Defender is the ultimate weapon in the battle against abusive balance billing tactics. Best of all, Patient Defender can be coupled with any type of health benefit plan – from reference-based pricing plans to traditional network plans; if and when a patient is threatened by these increasingly aggressive tactics, Patient Defender will be there.

Patient Defender finally plugs the gap that has existed across the industry in relation to reference-based pricing programs and balance billing concerns. With Patient Defender, a small PEPM rate ensures that a trusted law firm is placed on retainer, ready and willing to assist the patient when balance-billing occurs. Health plans, TPAs, and brokers can now contain costs while knowing that patients have a legal advocate standing by.

To learn more about Patient Defender or any of The Phia Group’s services, please contact our Vice President of Sales and Marketing, Tim Callender, Esq., at 781-535-5631 or tcallender@phiagroup.com.

 


 

Phia Fit to Print:

• BenefitsPro – COBRA can be complicated: What to watch for – December 4, 2019

• Self-Insurers Publishing Corp. – ACA Enrollment By The Numbers! Administration's Attempts To Stall The ACA At Work? – December 1, 2019

• BenefitsPro – Trending therapy options: Gene and stem cell therapy for self-funded plans – November 22, 2019

• Self-Insurers Publishing Corp. – ACA Round-Up for 2020: Items Affecting Employer-Sponsored Group Health Plans – November 5, 2019

• Self-Insurers Publishing Corp. – The Tower of Babel-Talking Heads Talking Past Each Other – October 4, 2019



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From the Blogosphere:

Washington’s “Surprise” Billing Law Goes Into Effect – January 2020. One less surprise you’ll have to worry about.

New Transparency Rules Released, But Will They Last? A proposed rule to bring transparency to hospitals near you.

Theories v. Practicality: The Simplest Answer is Often the Best! The easiest path to third party recovery.

Happy (Almost) New Plan Year! Preparing your plan documents for 2020!

Battle Lines Drawn over Medicare for All in the Latest Democratic Debate. Is there truly a cure for our healthcare system?

To stay up to date on other industry news, please visit our blog.



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Webinars

 

• On December 17, 2019, The Phia Group presented, “A Perfect Vision for 2020,” where we review the issues, topics, and innovations of 2019 that we believe will impact 2020, as well as the strategies you need to implement now to conquer the coming year.

• On November 13, 2019, The Phia Group presented, “Plan Language, Rx, and Lawsuits to Watch (and File): Innovation for a Changing Industry,” where we discuss innovative programs to manage vendor fees, balance-bill litigation, Rx manufacturer assistance, and other ideas being proposed by players in the industry.

• On October 17, 2019, The Phia Group presented, “2020 Forecast - Storm Clouds, Clear Skies, and the Issues that will Dominate Next Year,” where we discuss the issues that impacted 2019, and are poised to dominate 2020, including (but not limited to) Mental Health Parity, Paid Leave, Health Insurance Taxes, Drug Prices, Regulations, and Coupons.

Be sure to check out all of our past webinars!



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Podcasts:

Empowering Plans

• On December 19, 2019, The Phia Group presented, “Medicare Podcast for All” where our hosts, Ron Peck and Brady Bizarro, pick apart Elizabeth Warren’s Medicare-for-All proposal, and the concept as a whole; the good, the bad, and the really bad.

• On December 11, 2019, The Phia Group presented, “Preparing Your Plan Document for 2020,” where The Phia Group’s Executive Vice President and General Counsel, Ron E. Peck, and Senior Vice President of Consulting, Jen McCormick, sit down to discuss the top-rated topic chosen by Phia’s webinar listeners. Make sure you tune in to find out what Ron and Jen have to say about plan documents and learn the do’s and don’ts when it comes to reviewing and updating your plan document in 2020!

• On November 21, 2019, The Phia Group presented, “The Young & The Restless,” where our hosts, Adam Russo and Brady Bizarro sit down with Craig Clemente, Chief Operations Officer at Specialty Care Management and outgoing Chairman of the SIIA Future Leaders Committee, to discuss the future of the committee and the many ways they intend on engaging the younger generation.

 

Face of Phia

• On November 15, 2019, The Phia Group presented, “Shauna Makes a Comeback,” where our hosts, Adam Russo and Ron Peck, sits down with Shauna Mackey, The Phia Group’s Associate General Counsel. Tune in to learn more about Shauna and her experience with both public and private healthcare throughout her pregnancy and delivery.

• On November 4, 2019, The Phia Group presented, “Battling Balance-Billing,” where our hosts, Adam and Ron, interview Lyneka Hubbert, a Medical Claim Negotiator here at The Phia Group.

• On October 16, 2019, The Phia Group presented, “Reminiscing on Memories with Mrs. Marsh,” where our hosts, Adam and Ron, interview Jen Marsh, our Client Satisfaction & Quality Control Manager.

 

Tales From the Plan

• On October 24, 2019, The Phia Group presented, “Translating Phia’s Benefit Plan,” where our hosts, Adam Russo and Ron Peck, interview The Phia Group’s Human Resources Manager, Linda Pestana. Learn how Linda was able to navigate our health plan and negotiate with a provider to make her son’s hearing aids affordable.

Be sure to check out all of our latest podcasts!

 

 



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The Phia Group’s 2020 Charity

At The Phia Group, we value our community and everyone in it. As we grow and shape our company, we hope to do the same for the people around us.

The Phia Group's 2020 charity is the Boys & Girls Club of Metro South.

The mission of The Boys & Girls Club is to nurture strong minds, healthy bodies, and community spirit through youth-driven quality programming in a safe and fun environment.

The Boys & Girls Club of Metro South (BGCMS) was founded in 1990 to create a positive place for the youth of Brockton, Massachusetts. It immediately met a need in the community; in the first year alone, 500 youths, ages 8-18, signed up as club members. In the 25 years since, the club has expanded its scope exponentially by offering a mix of Boys & Girls Clubs of America (BGCA) nationally developed programs and activities unique to this club.

Since their founding, more than 20,000 Brockton youths have been welcomed through their doors. Currently, they serve more than 1,000 boys and girls ages 5-18 annually through the academic year and summertime programming.

 

Angel Tree

Each year employees of The Phia Group pick nametags from the Angel Tree that sits in our main lobby. On those tags are names, ages and the wish lists of children from The Salvation Army. This year we had over 130 nametags! The Phia family loves to give back to the community; our greatest joy is providing these children with all of their holiday wishes.

 

Christmas Came Early

The Phia Group had the pleasure of bringing Christmas joy to the Boys & Girls Club of Metro South. Adam Russo and his helpers passed out hundreds of gifts to over 130 children. We hope these children enjoy their new toys as much as they enjoyed spending time with Santa!

 

 

2019 Kennedy Service Award

Adam and Kelly Russo were honored with the 2019 Kennedy Service Award last week at the 2019 Great Futures Gala hosted by The Boys & Girls Clubs of Metro South. Check out the link below to see highlights from this unforgettable night! To learn more about this award, please visit

 

Thanksgiving Dinner Delivery

The Phia Family was out and about the week of Thanksgiving, delivering Thanksgiving dinners to the families of The Boys and Girls Club of Metro South! Additionally, our Phia Family in Idaho was out and about spreading the same cheer to five families in the Boise area. Check out the great picture we were able to get from that special night! We hope everyone had a wonderful Thanksgiving!

 



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The Stacks

ACA Enrollment By The Numbers! Administration's Attempts To Stall The ACA At Work?

By: Chris Aguiar, Esq. – December 2019 – Self-Insurers Publishing Corp.

With headlines focused on collusion, corruption, impeachment, and a wall being erected in Colorado, much of the political discourse in 2019 has avoided Healthcare Reform. In contrast, 2017 and 2018 featured many headlines with the current Administration doing everything within Its power to make good on a touchstone of Its 2016 campaign platform; President Trump and the Republican Party pushed for repeal and replacement of Barak Obama’s crowning achievement, the Affordable Care Act. When they were unable to garner the votes, the President utilized powers outside the control of Congress to weaken key parts of the Law designed to ensure the viability of the Insurance Marketplace, as well as keeping the American public in the dark regarding enrollment by virtually defunding marketing efforts. Many feared these tactics would encourage disengagement of the young and healthy, demographics crucial to maintaining a balanced risk pool covered by the Marketplace. Did it work?

Click here to read the rest of this article  


ACA Round-Up for 2020: Items Affecting Employer-Sponsored Group Health Plans

By: Corrie Cripps – November 2019 – Self-Insurers Publishing Corp.

During this open enrollment season, plan sponsors of group health plans should be aware of any Affordable Care Act (ACA) changes that may affect the design and administration of their plans.

The case Texas v. United States is the ongoing litigation challenging the constitutionality of the ACA. A decision on this case is expected at any time from the Fifth Circuit Court of Appeals (“Fifth Circuit”). Any decision appears likely to be appealed to the Supreme Court. Whether or not the Supreme Court will take the case depends on how the Fifth Circuit rules. If the Supreme Court does not take the case, the Fifth Circuit’s decision will remain the law; however, the agencies will most likely need to issue regulatory guidance on how they interpret the decision.

Click here to read the rest of this article

 

The Tower of Babel-Talking Heads Talking Past Each Other

By: Ron E. Peck, Esq. – October 2019 – Self-Insurers Publishing Corp.

As the 2020 Presidential Election draws closer, the topic of healthcare continues to dominate the airwaves. Be it media or debate, this is one of the (if not the) issue about which everyone is talking; but pay close attention and you’ll notice they aren’t all speaking the same language.

One word everyone can agree upon is “affordability.” The issue, however, is that depending upon whom you ask, what it is that ought to be “affordable” differs. Some people throw the term “access” around, while others seek affordable “care,” whilst still others focus (candidly) on affordable insurance.

Click here to read the rest of this article

 

To stay up to date on other industry news, please visit our blog.

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Phia’s 2019 Speaking Engagements:

• 1/9/2019 – FMMA Conference – Austin, TX

• 2/27/2019 – Sunlife 2019 MVP Academy – Denver, CO

• 3/8/2019 – UnitedAg Conference – Anaheim, CA

• 3/19/2019 – SIIA Self-Insured Health Plan Executive Forum – Charlotte, NC

• 3/21/2019 – CGI Business Solutions Seminar – Woburn, MA

• 3/26/2019 – HFTPA Broker Meeting – Tyler, TX

• 4/3/2019 – BenefitsPRO Broker Expo – Miami, FL

• 4/5/2019 – Pareto Conference – Nashville, TN

• 4/7/2019 – Captive Symposium – Cayman Islands

• 4/8/2019 – National Beer Wholesalers Association Legislative Conference – Washington DC

• 4/12/2019 – FMMA 2019 Annual Conference – Dallas, TX

• 4/23/2019 – Johns Hopkins Industry Education Series – Baltimore, MD

• 4/24/2019 – Sunlife 2019 MVP Academy – Kansas City, MO

• 4/25/2019 – BevCap’s Best Practices Workshop – Orlando, FL

• 4/26/2019 – Society of Professional Benefit Administrators Annual Conference – Washington, D.C.

• 5/2/2019 – MassAHU Benefest 2019 Conference – Westborough, MA

• 5/14/2019 – Cypress Unversity – Las Vegas, NV

• 5/30/2019 – Contrarian Captive – Austin, TX

• 6/11/2019 – Leavitt Conference – Big Sky, MT

• 7/16/2019 – HCAA TPA Summit – Dallas, TX

• 7/31/2019 – 2019 MVP Academy – Wellesley, MA

• 8/20/2019 – Pritchard & Jerden Employee Benefits Forum – Brookhaven, GA

• 9/17/2019 – WebTPA Annual Confernece – Dallas, TX

• 9/19/2019 – Employee Benefits Planning Association Conerence – Seattle, WA

• 9/30/2019 – SIIA National Educational Conference & Expo – San Francisco, CA

• 10/27/2019 – 2019 Annual NASP Conference – Washington DC

 

Phia’s 2020 Speaking Engagements:

• 1/30/2020 – SunLife MVP Academy – San Diego, CA

• 1/31/2020 – 2020 Kairos Risk Management Summit – Phoenix, AZ

• 2/13/2020 – Artex Risk Solutions Conference – Orlando, FL

• 2/18/2020 – HMIG Producer Advisory Counsil – Amelia Island, FL

• 3/9/2020 – CICA Captive Conference – Palm Springs, CA

• 3/12/2020 – SunLife MVP Academy – Kansas City, MO

• 3/26/2020 – TABA Spring Conference – Woodlands, TX

• 4/26/2020 – Berkley Captive Symposium – Caymen Islands

• 6/10/2020 – Leavitt Conference – Big Sky, MT

• 6/18/2020 – SunLife MVP Academy – Kansas City, MO

• 7/14/2020 – HCAA TPA Summit – St. Louis, MO

 

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Get to Know Our Employees of the Quarter:
Igor Senic & Desireé Erskine

Desireé is always going above & beyond to help everyone in the company. From trying to fix the fax machines & printers, sending out all of the mail when we are short-staffed at the front desk, to setting up a computer at a coworker’s home & driving them to and from work. She does all of these extra things while being the main component of the OP department. Desireé is an extremely hard worker who has passion and truly cares about this company.

Igor has worked so diligently over the past year in Accounting and it is well deserved. He has come up with multiple enhancements to improve and benefit the Accounting department.

A few examples:

(1) He has stepped up and has become someone on the team that the others can come to for assistance, ask questions, and resolve issues. (2) He set up training for the new Kentucky claims recovery specialists to make sure they are more comfortable with the Accounting payment process, along with trainings for the other accounting team members. (3) His knowledge of OP has helped make the OP payment processing more efficient & he was part of updating the OP payment process from processing payments individually to being able to process multiple payments at one time.

 

Congratulations Desireé (pictured above) and Igor, and thank you for your many current and future contributions.

 

Get to Know Our Employees of the Year:
Megan Colter & Joanna Wilmot

Megan joined our team as a Consultant in 2018. Since that time Megan’s duties have expanded to include final reviews of plan document checklists, assessments and SBC services. Megan has also been very helpful in training and mentoring new employees. Megan always makes sure the client’s expectations and deadlines are met. She has been staying late and/or working from home and her effort is appreciated. Megan is a pleasure to work with and we are happy she is part of our team!

Joanna is an exceptional example of a model employee. Her kindness, loyalty, enthusiasm, and dedication are only a few of the reasons why she deserves an employee of the year title. She is never short of energy which she selflessly offers to the team, her work product, and our clients.

She is dedicated and hardworking. Over the course of this year she reviewed, audited and revised each process to maximize efficiency and productivity. Specifically, our clients continue to ask for customized approaches, reports, and notifications. Most recently a TPA client requested a tailored notification process for when a mutual client was being onboarded by a partner vendor. Joanna not only went out of her way to build a notification process for this TPA but she also immediately implemented this process for all clients. This is an example of the personal touch and consistency she exemplifies every day. Building a sense of community is important to Joanna as well. For Thanksgiving she organized a team-building and community give back opportunity for PACE. This shows she not only cares about her team, but about her community and the team’s contribution to the community.

 

Congratulations Joanna & Megan, and thank you for your many current and future contributions.

 


Phia News

 

PACE® Certification Is Making Waves

The PACE Certification program will educate you using 3 distinct chapters of information:

Chapter One

Explore the ins and outs of self-funding while learning about its risks and rewards. This chapter will transform any individual into a self-funding pro.

Chapter Two

Take a deeper dive into the laws that apply to self-funded plans. We cover it all, from federal preemption to adverse benefit determinations and appeals.

Chapter Three

Explains what PACE is, what PACE does, and how it's obtained, implemented, and utilized. The PACE Certification program is free of charge and will create immense value for your organization. By going through the Certification program, you, or a select person, or team, within your organization, can become PACE Certified. Once PACE Certified, the Program participant(s) will become highly educated PACE business owners and will serve to assist your organization in growing your PACE business, enhancing your PACE revenue, and assuring your appeals processes are the most compliant and best in the industry. Those who complete the Certification will also receive a PACE Certification Fact Sheet, providing an easy to understand summary of the content and best practices covered, which will allow you to maximize the lessons learned within your business.

Additionally, the PACE Certification program provides education on self-funding in general, claims and appeals regulatory education, and overall best practices surrounding fiduciary duties, claims, and appeals.

Please see the PACE Certification flyer, as well as this video for more information.

Please contact Michael Vaz (mvaz@phiagroup.com) for more information.

 

Ugly Sweater Contest

The Phia family held its famous ugly sweater contest the week before Christmas, and we had a great turnout this year! With all of the great sweaters, it was a close race for finding the person with the ugliest sweater, but once we tallied up all of the votes, we found a winner. Congratulations to Rob Jolly, who is pictured below in the brown bear getup!

 

 

Halloween at Phia

Phia had its annual Halloween costume competition in late October. There were a lot of great costumes on display, but we could only choose one winner. Congrats to Ben Mooney, the homeless man with a passion for healthcare!

 

 

Candy Corn Contest

We set up a little contest at the front desk and asked everyone to guess how many candy corn! The winner was Andrew Fine, and the total count was 408. Andrew guessed that there were 402 pieces of candy corn. It’s hard to believe that all of those pieces of candy fit into that tiny jar!

 


 

Job Opportunities:

• PACE Specialist

• Administrative Assistant

• Staff Attorney – PGC

• Health Plan Documentation Specialist

• Claims Specialist, Provider Relations

• Manager, Talent Acquisition

• Case Investigator I

• Data / ETL Analyst

• Provider Relations Client Concierge

• Vice President of Client Solutions and Account Management

• Human Resources Compliance Specialist

See the latest job opportunities, here: https://www.phiagroup.com/About-Us/Careers
 

Promotions

• Bethany LaChance has been promoted from Case Investigator to Claim Recovery Specialist III

• Dylan Fry has been promoted from Case Investigator to Senior Claim Recovery Specialist

• Allison Britton has been promoted from Case Investigator to Legal Assistant

• Brenna Jackson has been promoted from Legal Assistant to Senior Claim Recovery Specialist

• Jiyra Martinez has been promoted from Customer Service Representative to Senior Claim Recovery Specialist

 

New Hires

• Diane Mcauley was hired as an Executive Assistant

• Arianna Hibbard was hired as an Executive Assistant

• Robert Jolly was hired as a Claim And Case Support Analyst

• Jessica Grande was hired as an Intake Specialist

• Alyssa Campbell was hired as a Case Investigator

• Elizabeth Painten was hired as a Human Resources Assistant

• Corey Crigger was hired as a Provider Relations Attorney

• Joshua Farley was hired as a Provider Relations Attorney

• Cole Wagner was hired as an Accounting Assistant



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info@phiagroup.com
781-535-5600

The Stacks – 1st Quarter 2020

On January 14, 2020

ACA Enrollment By The Numbers! Administration’s attempts to stall the ACA At Work?

By: Christopher Aguiar, Esq.

With headlines focused on collusion, corruption, impeachment, and a wall being erected in Colorado, much of the political discourse in 2019 has avoided Healthcare Reform. In contrast, 2017 and 2018 featured many headlines with the current Administration doing everything within Its power to make good on a touchstone of Its 2016 campaign platform; President Trump and the Republican Party pushed for repeal and replacement of Barak Obama’s crowning achievement, the Affordable Care Act. When they were unable to garner the votes, the President utilized powers outside the control of Congress to weaken key parts of the Law designed to ensure the viability of the Insurance Marketplace, as well as keeping the American public in the dark regarding enrollment by virtually defunding marketing efforts. Many feared these tactics would encourage disengagement of the young and healthy, demographics crucial to maintaining a balanced risk pool covered by the Marketplace. Did it work?

It all came to a head when, in rather theatrical fashion, the late Senator John McCain stood on the Senate floor and casted his vote with a momentous thumbs down, as though he was a dictator in Ancient Rome deciding the fate of a gladiator on the heels of a losing battle. This iconic moment marked the end of a legislative war of words, highlighted to that point by Twitter attacks from the President, himself, where the Republican Party was unable to garner the 50 votes necessary under the Budget Reconciliation Act to pass the Better Care Reconciliation Act. What followed was a tactical maneuvering by President Trump to undermine of key features of the ACA through his control of federal agencies and national purse strings.

First came a backhanded legislative maneuver wherein the Administration built Reform provisions into a tax bill. In December of 2017, President Trump signed the Tax Cuts and Jobs Act (“TCJA”). Among many other provisions, the Bill effectively directed the Internal Revenue Service to cease enforcing the Individual Mandate. In so doing, the Government would no longer penalize Americans who chose not to purchase health insurance. So, even though the Affordable Care Act was still the Law of the Land, one of the key provisions intended to protect the health of the risk pool by ensuring it was balanced and included not only the old and sick but also the young and healthy, now had no teeth. Many posited this lack of enforcement could hamstring the Law by encouraging the very malady it was designed to avoid, adverse selection. Without the tax to be levied upon non-compliant Americans, another important challenge to the Law was also set in motion, Its constitutionality.

When now Chief Justice Roberts upheld the constitutionality of the Affordable Care Act in an historic 2012 Supreme Court decision, it was upon enforcement of this provision that he relied. Specifically, Roberts held in National Federation of Independent Business v. Sebelius, 567 U.S. 519 (2012) that the Law was constitutional because the Federal Government was empowered to generate revenue. This penalty, as it was initially labeled, to be levied against Americans who chose not to purchase health insurance, then, was actually a tax, a permissible exercise of the Government’s power of taxation. So, too, was the Affordable Care Act considered constitutional. With the Administration’s removal of enforcement of this tax, without repealing the Law or provision itself, the constitutionality of the Affordable Care Act is again called into question because where no revenue is generated, the Individual Mandate is now arguably invalid. Such is the question to be answered by The Supreme Court when it issues a ruling Texas v. US, 809 F. 3d 134 (2015). Though oral arguments took place in July of 2019, no ruling has been issued.

The final act taken by the Administration was an exercise of the Executive Branch’s control of money. Specifically, it is within the power of the president to control how certain federal funds are spent, a power which allowed President Trump to slash the Affordable Care Act’s marketing budget by 90%. The fear? With significantly less advertising of open enrollment, would American’s be aware of the Open Enrollment period and how they could go about purchasing coverage on the Exchange?

Though not significant, the efforts may have had some impact on the enrollment which occurred from November 1 through December 15, 2018. According to Kaiser Family Foundation as well as the Centers for Medicare & Medicaid Services (“CMS”), enrollment through Healthcare.gov was down 4% in 2018 as compared to 2017. Overall, enrollment was down 3% in 2018 as compared to 2017. Those numbers seem insignificant when you consider the significant budgetary limitations that were placed on advertising, but perhaps the more telling and concerning data lies in the decline of new enrollees and percentage of those who qualified for subsidies. With respect to enrollees, 39% of enrollees were new in 2016. That number in 2017 had fallen to 31%, and even further in 2018 to 24%.

Perhaps the most concerning data point, however, is the percentage of new enrollees who qualify for premium subsides/tax credits. Those who qualify for these subsidies do so because they are individuals or families with low to moderate income levels. In 2017, 83% of new enrollees qualified for these subsidies. In 2018, that number grew to 87%. This indicates that lower income individuals and families are flocking to the health insurance exchanges at significantly higher rates than their wealthier (and perhaps, healthier) counterparts. Historically, data suggests that lower income individuals also tend to be less healthy. Accordingly, it appears the fear of adverse selection may indeed be manifesting itself as the young and healthy seem to be avoiding entering the Marketplace, either due to obtaining benefits through employee sponsored plans, or their willingness to gamble on their youth to save a buck.

It is difficult to ascertain with certainty whether the policy decisions made by the current Administration truly have a causal link to the drop indicated above, or if the connection is simply correlative. The numbers themselves speak to a very ominous reality. The number of new enrollees is declining each year. Additionally, the Marketplace appears to be obtaining a higher rate of enrollees annually in the low to moderate income demographic. Finally, 1/3 of new enrollees, annually, appear to be over the age of 55 and 64% are over the age of 35. As we head into 2020 and what should be another year of significant reform rhetoric, a Supreme Court decision that could leave the Country without a healthcare system on the books, and Healthcare once again top of mind in a presidential election cycle, the Administration will continue to attempt to repeal the Affordable Care Act, or endeavor to limit its efficacy. If adverse selection is in fact coming to fruition as the data seems to support, the Affordable Care Act may be headed for its demise either organically or though direct legislative attacks. It will certainly not be aided by an administration that will actively undermine the parts of a healthcare system that were intended to ensure its success; a flawed system that often leaves Americans footing a significant bill. Even with these attempts, the Republican Party has failed to clearly put forth a viable replacement. Be it with the ACA in some form, a Republican alternative, or the “Medicare for All” approach being touted by the large contingent Democratic candidates, Healthcare discussion is here to stay.

____________________________________________________________________________________________________

ACA Round-Up for 2020: Items Affecting Employer-Sponsored Group Health Plans

By: Corrie Cripps

During this open enrollment season, plan sponsors of group health plans should be aware of any Affordable Care Act (ACA) changes that may affect the design and administration of their plans.

The case Texas v. United States1 is the ongoing litigation challenging the constitutionality of the ACA. A decision on this case is expected at any time from the Fifth Circuit Court of Appeals (“Fifth Circuit”). Any decision appears likely to be appealed to the Supreme Court. Whether or not the Supreme Court will take the case depends on how the Fifth Circuit rules. If the Supreme Court does not take the case, the Fifth Circuit’s decision will remain the law; however, the agencies will most likely need to issue regulatory guidance on how they interpret the decision.

As of the date of this article, the Trump administration is continuing to enforce the ACA. As such, plans will need to ensure they are maintaining compliance with the ACA provisions. The following is a summary of the recent regulatory actions that will affect self-insured plans in 2020.

ACA Contraceptive Mandate

Update on the Obama-Era Rules

On June 5, 2019, U.S. District Judge Reed O’Conner of the Northern District of Texas issued a nationwide injunction2 against the Affordable Care Act’s (ACA’s) contraceptive mandate and its accommodation process, stating the mandate can no longer be enforced against employers who object to contraceptive coverage as it violates the Religious Freedom Restoration Act (RFRA). The injunction applies to all employers and individuals who object to contraceptive coverage based on sincerely held religious beliefs.

The case, DeOtte v. Azar3, was filed in October 2018 on the grounds that the plaintiffs (two Christian couples and one business whose owner is a Christian [Braidwood Management Inc.]) are forced to choose between purchasing health insurance that includes contraceptive coverage or not having insurance. The basis of the claim is having to choose between covering contraceptives under its group health plan, complying with the accommodation process of the contraceptive mandate, or paying a penalty for noncompliance. The court ruled that requiring employers with religious objections to use the contraceptive mandate’s accommodation violates RFRA, as does requiring individuals to obtain coverage with contraceptives.

This decision will apply to all employers that object to the contraceptive mandate, based on sincerely held religious beliefs, regardless of size or status as a nonprofit or for-profit entity. Since these employers are now exempt from the accommodation process, employees under these employer group health plans will no longer have coverage for some or all contraceptive services.

As for individuals, this decision allows individuals who object to some or all contraceptive services based on sincerely held religious beliefs to “…purchase or obtain health insurance that excludes coverage or payments for some or all contraceptive services from a health insurance issuer, or from a plan sponsor of a group plan, who is willing to offer a separate benefit package option, or a separate policy, certificate, or contract of insurance that excludes coverage or payments for some or all contraceptive services.” Based on this injunction, it is not clear if self-funded plans will need to offer a separate plan that does not include contraceptive coverage for employees who are religious objectors.

There is a safe harbor for officials who enforce the contraceptive mandate. Under the safe harbor, the federal government can ask whether an employer or individual that fails to comply with the contraceptive mandate is a sincere religious objector and file notice in court “…if the defendants reasonably and in good faith doubt the sincerity of that employer or individual’s asserted religious objections”. Federal regulators can also enforce the mandate against those who are found by a court to not be sincere religious objectors.

Update on the Trump Administration Rules

There are at least three lawsuits—brought in California, Massachusetts, and Pennsylvania—challenging the Trump administration’s final rules on religious and moral objections to the contraceptive mandate.4,5 Those rules were set to go into effect in January 2019 until they were enjoined by federal district court judges in Pennsylvania and California.

The rulings in Pennsylvania and California do not permanently block the new rules on the contraceptive coverage exemptions; however, the rulings stop the rules from going into effect while legal challenges are pursued.

Those employers who are potentially eligible for the expanded exemptions of the Trump administration’s final rules and wish to utilize an exemption in the future will need to closely monitor the latest developments.

Out-of-Pocket Limits for Non-Grandfathered Plans

2020 Out-of-Pocket Maximums

For non-HDHPs:

The Health and Human Services Department issued a Final Rule on its Notice of Benefit and Payment Parameters for 2020 (2020 NBPP Final Rule).6 The ACA 2020 maximum annual limitation on cost-sharing is $8,150 for individual coverage and $16,300 cumulative for family coverage. (Note that the ACA’s embedded self-only limitation is $8,150 for family plans).

For HSA-compatible HDHPs:

In Revenue Procedure 2019-25, the Internal Revenue Service (IRS) provided the inflation-adjusted Health Savings Account (HSA) contribution limits effective for calendar year 2020, along with minimum deductible and maximum out-of-pocket expenses for the high-deductible health plans (HDHPs) that HSAs are coupled with.7 For HDHP self-only coverage, the minimum deductible amount cannot be less than $1,400. The 2020 maximum out-of-pocket expense amount for self-only coverage is $6,900. For 2020 family coverage, the minimum deductible amount is $2,800 and the out-of-expense maximum is $13,800. (Note that the ACA’s embedded self-only limitation is $8,150 for family plans).

Drug Manufacturer Coupons

Per the 2020 NBPP Final Rule, health plans are not required to count drug manufacturer coupons toward the annual limit on cost-sharing when a medically appropriate generic equivalent is available.

On August 26, 2019, the Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury (collectively, “the Departments”) issued a joint FAQ regarding limitations on cost-sharing under the ACA.8 Specifically, the FAQ addresses whether non-grandfathered group health plans must count drug manufacturers’ coupons toward the annual cost-sharing/out-of-pocket limits under the ACA.

Per this new FAQ, it came to the attention of the Departments that the drug manufacturer coupon  provision of the 2020 NBPP Final Rule could create a conflict with the IRS regulations pertaining to HDHPs. Specifically, Q&A 9 of IRS Notice 2004-50 provides that the provision of drug discounts will not disqualify an individual from being eligible (for the HDHP) if the individual is responsible for paying the costs of the drugs (considering the discount) until the deductible is met.9 This Q&A requires the HDHP to disregard the drug assistance when determining whether the minimum deductible for an HDHP had been satisfied by only allowing amounts actually paid by the individual to be taken into account for that purposes.

The 2020 NBPP Final Rule, layered with the existing IRS Q&A, creates conflicting policy. As a result, the Departments, as stated in this August 2019 FAQ, realize this “ambiguity” and intend to undertake future rulemaking for 2021. In addition, until 2021, the Departments will not initiate an enforcement action if a group excludes the value of drug assistance from the annual limitation on cost sharing, including in circumstances in which there is no medically appropriate generic available.

Plans, however, when implementing or utilizing such a provision should be cognizant that this does not conflict with the existing Q&A for HDHPs.

Prior to adopting such a provision, the plan, employer, and all related entities should ensure they understand the impact for the participants and the plan.

New (or Modified) Preventive Care Recommendations for Non-Grandfathered Health Plans

The Affordable Care Act’s (ACA) preventive services mandate for non-grandfathered plans requires certain preventive services be covered in-network without cost-sharing for plan participants. The ACA uses the following when determining the preventive services that must be covered:

  1. Evidence-based items or services rated A or B in the United States Preventive Services Task Force (USPSTF) recommendations.
  2. Recommendations of the Advisory Committee on Immunization Practices adopted by the Director of the Centers for Disease Control and Prevention (CDC).
  3. Comprehensive guidelines for infants, children, and adolescents supported by the Health Resources and Services Administration (HRSA).
  4. Comprehensive guidelines for women supported by the Health Resources and Services Administration (HRSA).

The final preventive services regulations, issued in July 2015, contain guidelines for when plans must incorporate any modified recommendations.10

The following are new or modified preventive care recommendations that become effective in 2020:

1. Skin Cancer Prevention (Date Issued: March 2018; Best practice is to incorporate by the first day of the plan year on or after January 1, 2020)

The USPSTF updated its 2012 recommendation on skin cancer prevention. In this updated recommendation, the USPSTF expanded the age range for behavioral counseling interventions to include persons aged 6 months to 24 years with fair skin types (the previous recommendation applied to persons aged 10 to 24 years, based on the evidence available at that time).11

2. Screening for Osteoporosis to Prevent Fractures (Date Issued: June 2018; Best practice is to incorporate by the first day of the plan year on or after January 1, 2020)

The USPSTF recommends osteoporosis screening for postmenopausal women younger than 65 years at increased risk of osteoporosis (created from prior osteoporosis screening mandates, this requirement clarifies the population for screening, introduces reference to menopause, and references clinical risk assessment for determining increased risk).12

3. Spinal muscular atrophy screening for newborns (Date Issued: July 2018; Best practice is to incorporate by the first day of the plan year on or after January 1, 2020) 

The Uniform Panel of the Discretionary Advisory Committee on Heritable Disorders in Newborns and Children (an HRSA task force) added newborn screening for certain kinds of spinal muscular atrophy.13

4. Interventions to Prevent Obesity-Related Morbidity and Mortality in Adults (Date Issued: September 2018; Best practice is to incorporate by the first day of the plan year on or after January 1, 2020)

The USPSTF updated its previous 2012 recommendation statement on screening for obesity in adults. While it is still a “B” recommendation, the USPSTF expanded the description of behavioral counseling interventions. As with the 2012 recommendation, the 2018 recommendation is that clinicians offer or refer adults with a body mass index (BMI) of 30 or higher (calculated as weight in kilograms divided by height in meters squared) to intensive, multicomponent behavioral interventions.14 The only update to the recommendation is the expansion of the type of behavioral counseling interventions.

5. Screening for Intimate Partner Violence, Elder Abuse, and Abuse of Vulnerable Adults (Date Issued: October 2018; Best practice is to incorporate by the first day of the plan year on or after January 1, 2020)

This USPSTF recommendation incorporates new evidence since 2013 and provides additional information about the types of ongoing support services that appear to be associated with positive outcomes.15

ACA Reporting

Both the Employer Shared Responsibility Mandate (“Employer Mandate”) and the Individual Shared Responsibility Mandate (“Individual Mandate”) of the ACA continue to apply. As such, Applicable Large Employers (ALEs) will need to ensure they file the applicable forms for Internal Revenue Code (IRC) §§ 6055 and 6056 reporting in early 2020.

Conclusion

For plans and TPAs, being well-informed on regulatory developments is always of the upmost importance. Plan sponsors should review their plan documents as well as their plan administration procedures to ensure they are compliant.

1Texas v. United States, Partial Summary Judgment, https://www.documentcloud.org/documents/5629711-Texas-v-US-Partial-Summary-Judgment.html, (Last visited October 1, 2019).

2DeOtte v. Azar, Summary Judgment Order, https://affordablecareactlitigation.files.wordpress.com/2019/06/deotte-summary-judgment-order.pdf, (Last visited October 1, 2019).

3DeOtte v. Azar, Plaintiffs’ Class-Action Complaint, https://affordablecareactlitigation.files.wordpress.com/2019/05/deotte-complaint.pdf, (Last visited October 1, 2019).

4Religious Exemptions and Accommodations for Coverage of Certain Preventive Services Under the Affordable Care Act, 26 CFR Part 54, 29 CFR Part 2590, 45 CFR Part 147, October 13, 2017, https://www.gpo.gov/fdsys/pkg/FR-2017-10-13/pdf/2017-21851.pdf, (last visited October 1, 2019).

5Moral Exemptions and Accommodations for Coverage of Certain Preventive Services Under the Affordable Care Act, 26 CFR Part 54, 29 CFR Part 2590, 45 CFR Part 147, October 13, 2017,  https://www.gpo.gov/fdsys/pkg/FR-2017-10-13/pdf/2017-21852.pdf, (last visited October 1, 2019).

6Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters for 2020, 45 CFR Parts 146, 147, 148, 153, 155, and 156, April 25, 2019, https://www.govinfo.gov/content/pkg/FR-2019-04-25/pdf/2019-08017.pdf, (last visited October 1, 2019).

7Internal Revenue Bulletin: 2019-22, Rev. Proc. 2019-25, May 28, 2019, https://www.irs.gov/irb/2019-22_IRB#REV-PROC-2019-25, (Last visited October 1, 2019).

8Employee Benefits Security Administration, Frequently Asked Questions (FAQs) about Affordable Care Act (ACA) Implementation Part 40, August 26, 2019, https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/faqs/aca-part-40, (Last visited October 1, 2019).

9Internal Revenue Bulletin No. 2004-33, August 16, 2004, https://www.irs.gov/pub/irs-irbs/irb04-33.pdf, (Last visited October 1, 2019).

10Coverage of Certain Preventive Services Under the Affordable Care Act, 26 CFR Part 54, 29 CFR Parts 2510 and 2590, 45 CFR Part 147, July 14, 2015, https://www.govinfo.gov/content/pkg/FR-2015-07-14/pdf/2015-17076.pdf, (Last visited October 1, 2019).

11U.S. Preventive Services Task Force, Skin Cancer Prevention: Behavioral Counseling, March 2018, https://www.uspreventiveservicestaskforce.org/Page/Document/UpdateSummaryFinal/skin-cancer-counseling2, (Last visited October 1, 2019).

12U.S. Preventive Services Task Force, Osteoporosis to Prevent Fractures: Screening, June 2018, https://www.uspreventiveservicestaskforce.org/Page/Document/UpdateSummaryFinal/osteoporosis-screening1?ds=1&s=osteoporosis, (Last visited October 1, 2019).

13Health Resources & Services Administration, Recommendations to HHS Secretary with Responses: Spinal Muscular Atrophy (SMA), https://www.hrsa.gov/advisory-committees/heritable-disorders/recommendations-reports/index.html, (Last visited October 1, 2019).

14U.S. Preventive Services Task Force, Weight Loss to Prevent Obesity-Related Morbidity and Mortality in Adults: Behavioral Interventions, September 2018, https://www.uspreventiveservicestaskforce.org/Page/Document/UpdateSummaryFinal/obesity-in-adults-interventions1, (Last visited October 1, 2019).

15U.S. Preventive Services Task Force, Intimate Partner Violence, Elder Abuse, and Abuse of Vulnerable Adults: Screening, October 2018, https://www.uspreventiveservicestaskforce.org/Page/Document/UpdateSummaryFinal/intimate-partner-violence-and-abuse-of-elderly-and-vulnerable-adults-screening1?ds=1&s=violence, (Last visited October 1, 2019).

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The Tower of Babel – Talking Heads Talking Past Each Other

By: Ron E. Peck, Esq.

As the 2020 Presidential Election draws closer, the topic of healthcare continues to dominate the airwaves.  Be it media or debate, this is one of the (if not the) issue about which everyone is talking; but pay close attention and you’ll notice they aren’t all speaking the same language.

Access vs. Care vs. Insurance

One word everyone can agree upon is “affordability.”  The issue, however, is that depending upon whom you ask, what it is that ought to be “affordable” differs.  Some people throw the term “access” around, while others seek affordable “care,” whilst still others focus (candidly) on affordable insurance.

Interestingly, for many, the term they use (access versus healthcare) matters little, as – once their position is better defined – a shrewd listener will note that the goal is ultimately the same; make insurance cheaper.  They seem to believe that insurance is healthcare, and cheaper insurance is thereby cheaper healthcare.  Further, they believe that the only “cost” of healthcare, incurred by an insured person is their premium, co-pay, coinsurance, and deductible.

This, then, is one misconception that continues to dominate political, regulatory, and economic discourse; that by attacking the cost of insurance for the general populace (i.e. premiums/contributions, co-pays, coinsurance, and deductibles), you somehow fix the problem of limited access and/or the high cost of healthcare.

Health Insurance is Not Healthcare

I’ve written in the past, and continue to argue today, that health insurance is not healthcare.  Health insurance is one means by which the risk of payment for healthcare is shifted from the consumer of healthcare to a third-party payer.  Changing who pays for healthcare doesn’t (on its own) address how much the healthcare costs.  For instance, before you argue that Congress should establish a funding mechanism to support the “cost of caring” for those with significant medical needs, ask first what it means to pay for care.  Are you referring to the cost of insurance, or the cost of the “actual” health care for which insurance pays?

Some might argue, however, that when a “new” payer is designated, (be it insurance, a self-funded plan, or the government), if they are large enough and possess enough clout, they can strongarm the provider into accepting lower prices for care – thereby reducing the actual cost of care.  Thus, while making insurance more affordable doesn’t in and of itself reduce the cost of care, by providing more lives (and this negotiation power) to the payer, those payers in turn are provided with more “power” to force providers into accepting lower prices.  Indeed, a single-payer would hold all the cards, and thus name their own price.

In a vacuum it makes sense, and if we were purchasing potatoes or tires it may work (in a truly free-market environment), however, in healthcare some features apply that are unique to this industry.

A Non-Market Market

In any other market, a vendor of goods or services can set any price for those goods or services.  Supply, demand, and competition will then force the vendor to increase or reduce their price or fail.  This allows the “free market” to naturally set prices at a level both the seller and buyer can live with.  In healthcare, however, providers leverage things like technology, reputation, rankings, and sponsorships to compete for “customers” (a/k/a patients), rather than the price.  Providers compete for these other things; if and when price is a matter over which there is competition between vendors (providers), it’s a competition to see who can charge the most.  Indeed, one of the big pushbacks against transparent pricing in healthcare is that some providers will see that other providers “get away” with charging higher prices for the same services … and will increase their rates to match.  Imagine if that same argument applied to every other industry; that the cost of bananas couldn’t be transparent, because grocers will compete to raise prices faster than the competition.  Welcome to a world where the consumer has no skin in the game, and no price-based incentive to pick the lower cost options exists.

In healthcare, where patients don’t know, or (they think) pay the price of healthcare (at the time the care is consumed), and the consumer doesn’t appreciate the impact of higher healthcare prices on insurance costs, providers are able to freely raise prices without the negative repercussions vendors in other industries would immediately suffer.  Additionally, even if patients know the price, if they (at least in their mind) don’t think they are the ones paying the price, then higher prices will – at best – not dissuade them from consuming care, and – at worst – will steer them away from reasonably priced care to higher cost providers, thanks to an (inaccurate) assumption that higher price equates to higher quality. 

Quantum Meruit

At the same time, contract law states that a customer who agrees to pay a certain price for a service or product has entered into a contract with the vendor.  This preemptive agreement between the customer and vendor, regarding what will be paid, and what will be received by the customer, is titled a “meeting of the minds.”  If the customer later fails to pay the amount to which they’d previously agreed, this would be deemed a breach of contract.  Even if objectively, one could argue the agreed upon price is excessive, assuming the customer had the requisite capacity to enter into such a deal, the contract is binding.  If, however, someone receives a good or service but there was no meeting of the minds (agreement about what would be provided, and a specific price for said goods or services), the customer will be forced to pay an objectively reasonable price – determined by an objective third party, using objective pricing parameters – and NOT whatever price the vendor chooses to collect.  This concept, called Quantum Meruit, ensures vendors are adequately compensated based upon objectively reasonable parameters, and customers are not unjustly enriched (don’t “get something for nothing”) but also aren’t forced to pay a price they never agreed to (and which is excessive by all reasonable, objective measurements).

In healthcare, however, rarely can we say there is truly a meeting of the minds.  It is rare indeed to see a provider (the vendor) and patient (the consumer) agree upon a price prior to the provision of services.  Yet, despite this, Quantum Meruit – applicable to other commercial exchanges – has no place in healthcare, and rather, the provider is allowed to balance bill the patient whatever amount it wants – usually the amount that exists between the provider’s “charge master” price, and what it already received from the applicable carrier or benefit plan.  Note that the only prohibition on this billing practice is the prior existence of a contract between a payer and the provider, by whose terms the provider agrees to accept the payer’s payment as payment in full.  This agreement, many argue, is the greatest value a network offers.

Given that the law protects a provider’s right to charge whatever they wish – with no limits based in reasonableness, meeting of the minds, or Quantum Meruit – and limited only by pre-negotiated contracts, payers generally negotiate from a weak position.

As such, simply ensuring everyone has insurance will not drastically reduce the cost of healthcare itself.  Further, people – whether they are insured or not – will pay the cost when healthcare is too expensive.  Be it balance bills for the uninsured, or rising premiums and deductibles for the insured – the money needs to come from somewhere.

Compounding the issue further is that fact that Americans generally suffer from a lack of long-term vision.  We are, as a society, driven by a need for instant gratification.  People use credit cards to buy things now, that they can’t afford later.  People purchase homes and take out mortgages now, that they can’t afford later.  Likewise, people obtain healthcare now that they can’t afford later.  Make no mistake; even those with insurance pay the cost later, in the form of higher premiums, co-pays, deductibles, and co-insurance.  Therein lies the rub – people are quick to target out of pocket expenses at the time care is received, and the cost of insurance in general, but they do so without asking why insurance is expensive or addressing that root cause.

Until people understand that – with or without insurance – patients will ultimately be responsible for the actual cost of care, then the issue will not be resolved.  In other words, focusing on the rising out of pocket expenses, such as premiums, co-pays, and deductibles – without also focusing on why these expenses are increasing – addresses a symptom without diagnosing the disease.

What Does This Mean for Us?

Many candidates and their supporters are proponents of the so-called “Medicare for All” plan, yet even many who support those candidates are beginning to hesitate, worrying that under Medicare payment rates (forced down providers’ throats by a single payer monopoly), some hospitals struggling to stay open might close.  Here, then, we see the opposite issue – ushered in when a monopoly is in place.  A single payer with too much power can force opposition into accepting unduly low, unfair rates.

Is there a happy medium?  Some have argued that a so-called “public option” may be one such “middle ground,” but this idea cannot live in harmony with private benefits for long … resulting in the demise of private plans, and eventual monopoly that is a single payer, and which (as already discussed) most agree needs to be avoided.

Consider as “Exhibit A” the State of Washington.  Washington is set to become the first state to enter the private health insurance market with a so-called “public option,” at rates supporters say will be 10% cheaper than comparable private insurance.  Almost as if the lawmakers read my article above (before I even wrote it), they claim these savings will be achieved thanks to a cap on rates paid to providers.

Without going into too much detail regarding the pricing model (spoiler alert – it’s a percentage of Medicare), if this public option is indeed available to all residents, and if they can “force” providers to accept these payments as payment in full (thereby preventing balance billing), why would anyone sign up for a private plan?  If, then, all private plan members are steered by sheer common sense to this public option, private plans will cease to exist and – in this way – a single payer emerges from the exchange.

It was this threat that caused a public option to be removed from the proposed PPACA legislation, but now it’s back, at the State level as well as in proposals presented by Democratic candidates for the Presidency.

In the end, unless private plans and providers can achieve a meeting of the minds … and make healthcare affordable long term … this may be the future sooner than we think.

The Phia Group's 4th Quarter 2019 Newsletter

On October 21, 2019


Phone: 781-535-5600 | www.phiagroup.com



The Book of Russo:
From the Desk of the CEO

It’s renewal season here at The Phia Group, and in the self-insured industry, I can tell you that it’s busier than ever. It seems like finally all of the industry experts, advisors, and brokers are seeing the light and realizing that the time for change is now. It’s not just enough to disrupt, its time for a revolution in healthcare, and we are more than happy to lead the fight for higher quality, more transparency, and lower costs. We have seen a greater emphasis on empowering plans through data access, incentive based language in plans documents, and carve-outs through specific centers of excellence. The days of overgrown networks are slowing down with narrow networks, and better disease management opportunities are growing. I hope you have a great 4th quarter and success in your opportunities. We are always here to help. Happy reading.


Service Focus of the Quarter: Plan Appointed Claim Evaluator® (PACE)
Phia Group Case Study
Phia Fit to Print
From the Blogosphere
Webinars
Podcasts
The Phia Group’s 2019 Charity
The Stacks
Phia’s Speaking Events
Employee of the Quarter
Phia News

 

Service Focus of the Quarter: Plan Appointed Claim Evaluator® and PACE Certification

Plan Appointed Claim Evaluator®, or “PACE”

Some years ago, in response to growing industry concerns over the difficulty of exercising fiduciary duties with respect to internal appeals, The Phia Group created its Plan Appointed Claim Evaluator® (PACE) service. PACE is a fiduciary transfer service for applicable final-level internal appeals. It is designed solely to help the health plan ensure that it has made correct determinations, thereby insulating the health plan from liability and allowing the Plan Administrator to focus on its core business rather than difficult fiduciary determinations.

PACE includes:

• Plan Document and stop-loss policy “Gap Reviews” ensure compliance, eliminate coverage gaps, and ensure PACE readiness
• Advanced-level webinars exclusively for PACE clients
• Assessment of eligible final internal appeals via written directive as a fiduciary
• Unsurpassed legal analysis, clinical review and access to URAC-accredited IROs (and PACE covers all external review costs)

Beginning August 2019, we will also begin offering complimentary PACE Certification – whereby your organization can enhance your PACE business, improve your internal appeals processes, ensure regulatory compliance, and improve your business as a whole.

Chapter One of PACE Certification explores the ins and outs of self-funding; Chapter 2 takes a deeper dive into the laws and regulations applicable to self-funded health plans; Chapter 3 explains what PACE is, how it works, and how it can best be utilized.

PACE Certification

PACE Certification provides access to a multimedia educational program! Through videos and interactive knowledge materials, you will emerge educated and entertained! Once PACE certified, you will enhance your PACE business and increase revenues, improve your appeals processes, and assure regulatory compliance!

Chapter One: Explore the ins and outs of self-funding while learning about its risks and rewards. This chapter will transform any individual into a self-funding pro.

Chapter Two: Take a deeper dive into the laws that apply to self-funded plans. We cover it all, from preemption to adverse benefit determinations and appeals.

Chapter Three: Explain what PACE is, what PACE does, and how it’s obtained, implemented, and utilized.

To learn more about either PACE or PACE Certification, please contact Tim Callender at 781-535-5631 or tcallender@phiagroup.com.

 

Phia Case Study: Independent Consultation & Evaluation (ICE) 

A client of The Phia Group’s ICE service approached our consulting team with an inquiry whereby an employee had accrued two weeks of paid time off (PTO) pursuant to the employer’s own internal policies, and that employee was about to take leave to deliver her first child. The inquiry was specifically regarding whether the employee could first take her accrued PTO for two weeks, and then begin FMLA leave, for leave totaling 14 weeks (two weeks PTO plus twelve weeks FMLA).

Our response focused on some guidance provided by the Department of Labor. In March 2019, the DOL was very specific in its mandate that once an employer knows that a leave of absence qualifies under FMLA, the employer must designate the leave as FMLA leave, regardless of any available PTO or other employer-approved leave.

In other words, the DOL requires the FMLA and PTO leaves to run concurrently; since the PTO totaled 2 weeks and the FMLA totaled 12 weeks, those first 2 weeks would have the leaves running concurrently, and then, if taken, there would be only ten additional weeks available of solely FMLA.

It’s important to mention in this context that employers have a wide berth to structure their own policies, grant leave, and other employment-type things – but continuation under the health plan should be pursuant to Plan terms, rather than only employer policies; this is important for many reasons, not the least of which being stop-loss coverage.

If the employer granted two weeks of continuation coverage in addition to the twelve guaranteed by FMLA, claims incurred in weeks 13 and 14 would likely not be covered by stop-loss, (since, again, the DOL requires that the two weeks of PTO be fully exhausted concurrently with the FMLA leave, resulting in twelve total weeks rather than fourteen). If the employer had offered those two additional weeks of continued coverage after the first twelve, it would have been neither FMLA nor PTO (i.e. it would have been a “favor” done by the employer), and therefore the stop-loss insurer could determine that it is not covered leave sufficient to invoke coverage under the stop-loss policy.

We therefore opined that allowing the employee to delay designation of FMLA for the purposes of extending coverage beyond 12 weeks would not only violate the DOL’s rules, but it may also result in issues with stop-loss reimbursement for claims incurred after the exhaustion of FMLA as proscribed by the DOL – both of which can carry serious repercussions.

While this issue deserves more analysis than what is described in this case study, this knowledge may have helped save the employer from violating federal regulations as well as potential stop-loss denials!


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Fiduciary Burden of the Quarter: Following the SPD – Unless Inconsistent with the Law!

You may have heard of the so-called “greatest of three” rule with respect to out-of-network emergency services. This regulation – codified at 45 CFR 147.138(b)(3). This regulation, in a nutshell, requires that for out-of-network emergency services, self-funded health plans allow claims at the greatest of (1) 100% of Medicare, (2) the amount the plan would allow for non-emergent out-of-network claims (in other words, Usual and Customary, Maximum Allowable Charge, etc.), or (3) the median contracted rate for emergency services.

Many health plans and TPAs disregard this “greatest of three” rule, either by not containing the proper plan language or simply not following the regulation. In fact, in the performance of The Phia Group’s PACE service, we often need to ask our clients regarding their median contracted rate for emergency services – and we are sometimes informed that the TPA does not know.

They say “knowledge is power,” but in this case, “knowledge is compliance!” Without knowing each of those three elements, it is impossible to know which one is truly highest. This becomes especially dangerous for plans that pay out-of-network emergency claims based on Medicare rates; for such plans, it is incredibly common for the median contracted rate to be higher than the Plan’s chosen percent of Medicare – so knowing the median contracted rate can be the only way to compliantly adjudicate an out-of-network emergency claim.

There are two action items: first, make sure your SPDs are specific on this “greatest of three” rule, such that for non-contracted emergency claims, they are paid pursuant to this regulation – and second, make sure you are acutely aware of the median contracted rate for emergency services, since we have seen more and more providers raising this point in appeals of non-contracted emergency claims!

 

Success Story of the Quarter: The Balance-Billing “End Game”

A health plan had a member who was visiting some out-of-state relatives, and that member happened to sustain a non-emergent injury while playing frisbee with his family. He didn’t go to the emergency room, but instead (wisely!) visited a local Urgent Care facility, which referred him to a local ASC. The health plan of which this individual was a member utilized a small regional network in its home state, with Phia Unwrapped for non-network claims. Since neither the Urgent Care facility nor the ASC was not part of that regional network, this claim became subject to Phia Unwrapped, and was consequently priced at 165% of Medicare – a rate the health plan had chosen.

The ASC billed $17,000 for the eventual care provided, of which 165% of Medicare totaled around $7,500. The member was subsequently billed for the remainder.

The ASC was adamant that its billing was reasonable, and cited the fact that it had billed at only 375% of Medicare; when Phia’s balance-billing support team pointed out that 375% of Medicare is not a reasonable amount, the provider outright refused to negotiate its bill, and continued to bill the patient. The refusal to negotiate is a rare stance, but this ASC was so confident in its ability to collect that it felt it was appropriate.

Unfortunately for this ASC, the particular benefit plan and TPA had had enough with this type of provider mentality; after much discussion, the TPA and plan – with Phia’s assistance – engaged local counsel to file a lawsuit on behalf of the patient to challenge the provider’s billing as unreasonably high. Prior to that filing, we warned the ASC that if we were unable to settle, litigation would likely ensue, but the ASC balked in disbelief.

Fast-forward about two weeks: the very same day the complaint was served upon the ASC, we received correspondence indicating that the ASC would accept Phia’s prior offer of an additional $1,500 to close the claim.

New Service Offered by Phia: Patient Defender

The Phia Group is proud to introduce its “Patient Defender” program. For a small PEPM fee, every plan participant has access to legal representation against lawsuits targeting patients, or crippling balances being sent to collections, when efforts to amicably resolve these disputes fail, Patient Defender is the ultimate weapon in the battle against abusive balance billing tactics. Best of all, Patient Defender can be coupled with any type of health benefit plan – from reference-based pricing plans to traditional network plans; if and when a patient is threatened by these increasingly aggressive tactics, Patient Defender will be there.

Patient Defender finally plugs the gap that has existed across the industry in relation to reference-based pricing programs and balance billing concerns. With Patient Defender, a small PEPM rate ensures that a trusted law firm is placed on retainer, ready and willing to assist the patient when balance-billing occurs. Health plans, TPAs, and brokers can now contain costs while knowing that patients have a legal advocate standing by.

To learn more about Patient Defender or any of The Phia Group’s services, please contact our Vice President of Sales and Marketing, Tim Callender, Esq., at 781-535-5631 or tcallender@phiagroup.com.

 


 

Phia Fit to Print:

• BenefitsPro – Drug manufacturer coupons and out-of-pocket limits: What employers need to know – September 23, 2019

• Self-Insurers Publishing Corp. – Reference-Based Pricing: Pitfalls For A New ERA – September 3, 2019

• BenefitsPro – Universal health care: Comparing what looks nice on paper to reality – August 26, 2019

• Self-Insurers Publishing Corp. – How Self-Insured Health Plans Are Helping Employers Compete In A Challenging Talent Marketplace – August 5, 2019

• BenefitsPro – Blocking TV drug price disclosures: What's next? – July 31, 2019

• Free Market Healthcare Solutions - Senate Finance Committee Tackles Prescription Drug Prices – July 21, 2019

• Self-Insurers Publishing Corp. – Big Pharma Facing Big Losses Tied To Opioid Epidemic Fallout – July 4, 2019

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From the Blogosphere:

Lots of Moving Parts. Put your Reference-Based Pricing knowledge to the test.

Controversy Surrounds the Most Expensive Drug in the World. A drug designed to help kids that will bankrupt their parents.

There’s a New Notice on the Block. On July 17, 2019 the Internal Revenue Service issued Notice 2019-45.

Health Care “Cadillac Tax” Repeal Bill Passed by the House. This Cadillac Tax could hit your wallet and leave a mark.

Network Contract Drafting: You’re Doin’ It Wrong. Watch you contract language!

 

To stay up to date on other industry news, please visit our blog.

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Webinars

 

• On September 17, 2019, The Phia Group presented, “2020 Renewal Season - Decisions Today, Uncertain Tomorrow,” where we discuss important issues impacting plan renewals, address known roadblocks, and perform an assessment of the candidates’ positions on healthcare – with an eye toward what we should be doing today to prepare for an uncertain tomorrow.

• On August 21, 2019, The Phia Group presented, “Back to School: 2020 Renewals,” where we provide the education needed to help you meet your obligations and keep your business safe – and provide the information you need to earn a “passing grade” during renewal season!

• On July 23, 2019, The Phia Group presented, “Trump’s Executive Order on Transparency: How it Will Effect Each Segment of Our Industry,” where we discuss the executive order point by point; they’ll touch on what they like and don’t like about it, and – more importantly – what this all means for you.

Be sure to check out all of our past webinars!



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Podcasts:

Empowering Plans
 

• On September 18, 2019, The Phia Group presented “Politics! Politics! Politics!,” where our hosts, Ron Peck and Brady Bizarro, discuss Obamacare, the state of health care versus health insurance, and the political environment as we move toward the 2020 election.

 

Face of Phia

 

• On September 4, 2019, The Phia Group presented, “Crunching Numbers with Desmond Campbell,” where our host, Ron Peck, sits down with Desmond Campbell, the man, the myth, the legend.

• On August 16, 2019, The Phia Group presented, “The Fine Fan Club!,” where our hosts, Adam and Ron, learn more about the life and background of Andrew Fine, Phia’s Lead Intake Specialist.

• On August 1, 2019, The Phia Group presented, “The Magical Kingdom!,” where our hosts, Adam and Ron, interview Mattie Sesin, our Director of Recovery Services.

 

Tales From the Plan

 

• ON September 23, 2019, The Phia Group Presented, “A Vision for Savings,” where Adam Russo and Michael Vaz sit down to discuss his experience with The Phia Group’s health plan and how he was able to save money for the plan and get rewarded for doing so.

• On July 17, 2019, The Phia Group presented, “Direct & To The Point!,” where The Phia Group’s VP of Legal Recovery Services, Chris Aguiar, Esq., discusses his experiences before and after becoming a happy participant in Direct Primary Care.

• On July 8, 2019, The Phia Group presented, “Mrs Peck, It’s Cancer…,” where our host, Ron Peck, tells us about his family’s battle against cancer, and lessons we can all learn from their experience.

Be sure to check out all of our latest podcasts!



 

 

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The Phia Group’s 2019 Charity

At The Phia Group, we value our community and everyone in it. As we grow and shape our company, we hope to do the same for the people around us.

The Phia Group's 2019 charity is the Boys & Girls Club of Brockton.

The mission of The Boys & Girls Club is to nurture strong minds, healthy bodies, and community spirit through youth-driven quality programming in a safe and fun environment.

The Boys & Girls Club of Brockton (BGCB) was founded in 1990 to create a positive place for the youth of Brockton, Massachusetts. It immediately met a need in the community; in the first year alone, 500 youths, ages 8-18, signed up as club members. In the 25 years since, the club has expanded its scope exponentially by offering a mix of Boys & Girls Clubs of America (BGCA) nationally developed programs and activities unique to this club.

Since their founding, more than 20,000 Brockton youths have been welcomed through their doors. Currently, they serve more than 1,000 boys and girls ages 5-18 annually through the academic year and summertime programming.

 

Back to School

Our friends from the Boys & Girls Club of Brockton are going back to school, and the Phia Family wanted to send them some school supplies to go back to school with. The Phia family donated a total of 3,500 school supplies/backpacks and $1,700 in monetary donations. We hope all of the amazing children are enjoying their new school supplies!

 

Volunteer Day

The Phia Family was out and about a few months back, celebrating our annual volunteer day at the Boys & Girls Club of Brockton. There were a variety of activities for the kids to participate in, between archery, rock climbing, basketball, hiking, and so much more. In addition to partaking in activities with the kids, we all got to see the new pavilion that was donated by The Phia Group. Next year, we are planning on decorating the pavilion for the kids. That being said, we are already looking forward to next year!



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The Stacks

Reference-Based Pricing: Pitfalls For a New Era

By: Jon Jablon, Esq. – September 2019 – Self-Insurers Publishing Corp.

How many times have you read an article or listened to a sales pitch about how great reference-based pricing is? RBP can add a lot of value, and many of us have seen that first-hand. But that is not the purpose of this article. As a consultant in the self-funded industry, The Phia Group has lots of opportunities to review and assess reference-based pricing plans and various claims situations. We have seen plans experience a great deal of RBP success – but we have also seen many RBP failures.

As many of you reading this have found out the hard way, and often unexpectedly, there are certain ways that RBP can go poorly and cause harm to an employer’s health plan, employee base, or even business reputation.

Click here to read the rest of this article


How Self-Insured Health Plans Are Helping Employers Compete In A Challenging Talent Marketplace

By: Philip Qualo, J.D. – August 2019 – Self-Insurers Publishing Corp.

Prior to joining The Phia Group, LLC, an experienced health care cost-containment company specializing in self-insured plans, my knowledge and experience with the self-insured industry could fit on the tip of my pinky. My previous work experience was exclusively in the fully-insured sector, where I quickly learned that uttering the words “self-insurance” was considered almost offensive. On a more personal level, I had been covered under various fully-insured health plans since my very first job after graduating law school. From the start, my experience with fully-insured plans jaded my perception of health benefits. I eventually accepted that medical insurance was a necessary evil that I would have to learn to live with. Although my employers genuinely cared about the well-being of their employees, the ability to offer comprehensive medical benefits became increasingly difficult due to the monumental annual increases in the cost of fully-insured coverage.

Click here to read the rest of this article

 

Big Pharma Facing Big Losses Tied To Opioid Epidemic Fallout

By: Sean Donnelly, Esq. – July 2019 – Self-Insurers Publishing Corp.

In 2017, a total of 70,237 people in the United States died from a drug overdose. A staggering 67.8% of those deaths involved the use of opioids, a startling escalation that has been classified as a national epidemic. Deaths attributed to synthetic opioids have become increasingly prevalent, accounting for 59.8% of all opioid overdose deaths.

Every day, an average of 46 people in the United States die from overdoses specifically involving prescription opioids. The highest prescription opioid-involved death rates in 2017 were in West Virginia, Maryland, Kentucky and Utah. According to the National Institute on Drug Abuse, drug overdose deaths involving opioids that were prescribed rose from 3,442 in 1999 to 17,029 in 2017.

Click here to read the rest of this article

 

To stay up to date on other industry news, please visit our blog.

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Phia’s 2019 Speaking Engagements:



• 1/9/2019 – FMMA Conference – Austin, TX

• 2/27/2019 – Sunlife 2019 MVP Academy – Denver, CO

• 3/8/2019 – UnitedAg Conference – Anaheim, CA

• 3/19/2019 – SIIA Self-Insured Health Plan Executive Forum – Charlotte, NC

• 3/21/2019 – CGI Business Solutions Seminar – Woburn, MA

• 3/26/2019 – HFTA Broker Meeting – Tyler, TX

• 4/3/2019 – BenefitsPRO Broker Expo – Miami, FL

• 4/5/2019 – Pareto Conference – Nashville, TN

• 4/7/2019 – Captive Symposium – Cayman Islands

• 4/8/2019 – National Beer Wholesalers Association Legislative Conference – Washington DC

• 4/12/2019 – FMMA 2019 Annual Conference – Dallas, TX

• 4/23/2019 – Johns Hopkins Industry Education Series – Baltimore, MD

• 4/24/2019 – Sunlife 2019 MVP Academy – Kansas City, MO

• 4/25/2019 – BevCap’s Best Practices Workshop – Orlando, FL

• 4/26/2019 – Society of Professional Benefit Administrators Annual Conference – Washington, D.C.

• 5/2/2019 – MassAHU Benefest 2019 Conference – Westborough, MA

• 5/14/2019 – Cypress Unversity – Las Vegas, NV

• 5/30/2019 – Contrarian Captive – Austin, TX

• 6/11/2019 – Leavitt Conference – Big Sky, MT

• 7/16/2019 – HCAA TPA Summit – Dallas, TX

• 7/31/2019 – 2019 MVP Academy – Wellesley, MA

• 8/20/2019 – Pritchard & Jerden Employee Benefits Forum – Brookhaven, GA

• 9/17/2019 – WebTPA Annual Conference– Dallas, TX

• 9/19/2019 – Employee Benefits Planning Association Conference– Seattle, WA

• 9/30/2019 – SIIA National Educational Conference & Expo – San Francisco, CA

• 10/27/2019 – 2019 Annual NASP Conference – Washington DC

 

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Get to Know Our Employee of the Quarter:
Lyneka Hubbert

Lyneka is a truly dedicated case handler for the Provider Relations department. She has a vast knowledge of the most proficient and effective ways to work each file. Perhaps even more importantly, she is a great communicator with our clients. One of the most important aspects of this role is to keep our clients updated and confident in the work we are doing. We need to present a clear understanding of where our files stand while providing our clients with multiple options on how we can proceed. Lyneka does a fabulous job of communicating these types of things to our clients in a timely manner. She is persistent with the providers when trying to get a balance written off or a settlement reached. She explores all possible arguments with the providers so that she can have optimum success with her files.

She is also a great team member and is always willing to go above and beyond what is expected of her. Whether this means staying late, helping a team member catch up on work, or executing tasks not normally assigned to her, she is always there to step up with a positive attitude.

 

Congratulations Lyneka, and thank you for your many current and future contributions.

 

 


Phia News

 

PACE® Certification Has Arrived!

The PACE Certification program educates you using 3 distinct chapters of information:

Chapter One
Explore the ins and outs of self-funding while learning about its risks and rewards. This chapter will transform any individual into a self-funding pro.

Chapter Two
Take a deeper dive into the laws that apply to self-funded plans. We cover it all, from federal preemption to adverse benefit determinations and appeals.

Chapter Three
Explain what PACE is, what PACE does, and how it's obtained, implemented, and utilized.

The PACE Certification program is free of charge and creates immense value for your organization. By going through the Certification program, you, or a select person, or team, within your organization, can become PACE Certified. Once PACE Certified, the Program participant(s) will become highly educated PACE business owners and will serve to assist your organization in growing your PACE business, enhancing your PACE revenue, and assuring your appeals processes are the most compliant and best in the industry. Those who complete the Certification will also receive a PACE Certification Fact Sheet, providing an easy to understand summary of the content and best practices covered, which will allow you to maximize the lessons learned within your business.

Additionally, the PACE Certification program provides education on self-funding in general, claims and appeals regulatory education, and overall best practices surrounding fiduciary duties, claims, and appeals.

Please see the PACE Certification flyer, as well as this video for more information.

Please contact Michael Vaz (mvaz@phiagroup.com) for more information and to sign up today!

 

Team Building

After a fun day of volunteering with the children from the Boys & Girls Club of Brockton, the Phia Family took the remainder of the day to work on some good, old-fashioned team-building exercises. Throughout the day, the Phia Family was split into groups and faced with a variety of different tasks. After all of the exercises were complete, the Phia Family felt closer than ever. Check out the picture below to see how exciting the games were!

 

Our Louisville, KY Office is Now Open

The Phia Group, LLC is pleased to announce the opening of a new office in Louisville, KY. Under the leadership of the newly appointed Vice President of Operations and Total Quality Management, Scott Byerley, Esq., this new location strengthens The Phia Group's presence in the central United States - just as it did in the west with its Boise, ID, office - continuing to allow The Phia Group to identify, recruit, and hire the most talented professionals, nationwide.

With a focus on subrogation and claims recovery, as well as other cost containment activities, the Louisville team shares the same passion as the entirety of the "Phia Family," to deliver robust yet affordable health benefits to as many hard working Americans as possible. " We're very excited to bring The Phia Group to Louisville. This is a continuation of year after year growth for The Phia Group," remarked Mr. Byerley. "The Phia Family made this happen with their dedication and passion for everything cost containment and reducing the costs of healthcare."

 

 

Cornhole Tournament and Phia BBQ

It has become tradition at The Phia Group to celebrate the last day of summer with great games, food and conversations. This year we invited all Phia employees to enter into our cornhole tournament. As you can see, we had a great turnout. The winners of the cornhole tournament were Harry Horton and Jeff Hannah. Congrats on the win, it was a close game!

 


 

Job Opportunities:

• Health Benefit Document Drafter

• Health Benefits - Case Investigator I

• Claim and Case Support Analyst

• Client Intake Specialist

• Overpayments Care Representative

• Customer Care Representative

See the latest job opportunities, here: https://www.phiagroup.com/About-Us/Careers

 

Promotions

• Kelly Dempsey, Esq. has been promoted from Director, Independent Consultation and Evaluation Services to Director, Consulting and ICE Services

• Dylan Fry has been promoted from Marketing & Accounts Intern to Claim Recovery Specialist

• Dante Tylerbest has been promoted from Customer Service Representative to Overpayment Recovery Assistant

• Denise Swienc has been promoted from Customer Service Representative to Case Investigator


 

New Hires

• Crystal Cascante was hired as an Intern

• William Lovejoy was hired as an IT Systems Administrator

• Craig Malcolmson was hired as an Intake Specialist

• John Shearer was hired as a Health Benefit Plan Admin - Attorney I

• Shauna Mackey was hired as an Associate General Counsel

• Brian Wentworth was hired as a Claims Specialist II, Provider Relations

• Dillon Fosa was hired as a Marketing & Accounts Coordinator

• Larice Booker was hired as an Overpayments Recovery Specialist

• Brittney Willoughby was hired as a Sr. Claims Recovery Specialist

• Elizabeth McAlister was hired as a Sr. Claims Recovery Specialist

• Melanie Brown was hired as an Intake Specialist

• Ashley Jancaterino was hired as an Intake Specialist

• Cornelius Mance was hired as an Attorney I

• Ervin Morice was hired as a Case Investigator I

• Jason Pence was hired as a Sr. Claims Recovery Specialist

• Heather Breckenridge was hired as a PACE Client Intake Coordinator

• Allison Britton was hired as a Case Investigator I

• Aditya Sukumar was hired as a Business Analyst



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info@phiagroup.com
781-535-5600

The Stacks - 4th Quarter 2019

On October 16, 2019

Reference-Based Pricing: Pitfalls For a New Era

By: Jon Jablon, Esq

How many times have you read an article or listened to a sales pitch about how great reference-based pricing is? RBP can add a lot of value, and many of us have seen that first-hand. But that is not the purpose of this article. As a consultant in the self-funded industry, The Phia Group has lots of opportunities to review and assess reference-based pricing plans and various claims situations. We have seen plans experience a great deal of RBP success – but we have also seen many RBP failures.

As many of you reading this have found out the hard way, and often unexpectedly, there are certain ways that RBP can go poorly and cause harm to an employer’s health plan, employee base, or even business reputation.

RBP is a powerful payment methodology used by thousands of health plans around the country, but like so many cost-containment tools, a full understanding of the entire process and a strong implementation of the key elements are absolutely crucial to its success – and even seemingly inconsequential flaws in the process can prove to be problematic down the road. Let’s go through some of the biggest pitfalls.

Lack of Preparation: Poor Supporting SPD Language

Like so many things in the self-funded industry, a health plan’s rights with respect to RBP pricing are only as good as the plan’s language. A plan document should contain language to both allow the plan to pay claims as it sees fit, and to create arguments against balance-billing. A lack of adequate plan language makes the health plan especially vulnerable to appeals and lawsuits.

To provide a practical example, I was recently presented with a case where a health plan had neglected its Plan Document through the years. It was last restated in the late ‘90s, it had over 30 amendments, and it was just plain old confusing to read. That group utilized an RBP methodology, and yet there was a complete lack of payment limitation language, except for one sentence: “Expenses allowed at an amount the Supervisor deems reasonable.”

There are two main problems there: one is that the Supervisor was the TPA (so the first moral of this story is that TPAs should be wary of that type of unexpected liability), and the other is that this does not reference the 155% of Medicare at which rate the group’s RBP vendor had been pricing claims for six months.

What happened next? A large hospital system decided that it wanted to appeal, rather than jumping straight to balance-billing, and in the course of the appeal, the Plan Document was produced. I can just imagine the hospital’s attorney’s eyes filling with gigantic dollar signs when it saw that non-existent RBP language; the result is that while the vendor was repricing claims and raking in its fee, the Plan Document had not supported the program, and the Plan had not limited its exposure. Rather than face a lawsuit, the Plan had no choice but to pay the hospital’s demand in full… and hopefully amend its Plan Document language as soon as possible.

The seldom-referenced section 402(b)(4) of ERISA requires a health plan to “specify the basis on which payments are made to and from the plan.” There is precious little law to interpret exactly what that means, but it is the backbone of the sentiment that “your rights are only as good as your language,” and it seems safe to say that the particular provision within this health plan does not meet the relatively low standard of specifying how payments are made.

Poor Explanations: Inaccurate EOBs

There are two extremely common mistakes that health plans make when generating Explanations of Benefits with respect to RBP claims: (1) providing inaccurate or nonspecific remark codes, and (2) calling the amount over the Plan’s allowable amount a “discount.”

The former is a compliance problem; ERISA requires that EOBs contain not only an explanation of why the claim was priced as it was (according to the regulations at 29 CFR 2560-503.1, “The specific reason or reasons for the adverse determination”), but also a reference to the specific provision in the Plan Document that allows the denial (“Reference to the specific plan provisions on which the determination is based”).

The latter is a business issue; a “discount” is something that is allowed by the provider (typically in the contractual sense), whereas the excess or disallowed amount is, by definition, not agreed-upon in advance by the provider. Incorrectly using the term “discount” is problematic because not only is it incorrect, but it starts all parties out on the wrong foot – and working with a hospital to write off a bill is much more difficult when the provider goes into the conversation already thinking that the payor has tried to take advantage.

Incorrect Implementation: Applying RBP Payments to Contracted Claims

RBP results can be so good that some employers are tempted to apply RBP to contracted claims as well, the theory being that the contracted rate is still higher than what the plan deems reasonable, so the RBP savings are desirable for all claims, even contracted ones. While the contracted rate may well be just as arbitrary and overbilled as the original billed charges, it’s important to remember that contracts are legally-binding instruments, and contracted providers sometimes have powerful legal backing.

This is perhaps another topic for another article – suffice it to say that unless the applicable fee agreement allows it, the health plan’s chosen pricing cannot be applied to contracted claims without violating that agreement. It is a frighteningly-popular misconception within the self-funded industry that network or other fee agreements generally allow health plans to apply the contractual discount on top of the plan’s chosen edits or reductions (including Medicare rates).

Consider the example of a $50,000 claim subject to a mandatory contractual 10% discount, yielding a contractual payment rate of $45,000. The payor priced the claim at 150% of Medicare based on the Plan Document, which totaled $10,000. While the contractual rate would require that this claim be paid at $45,000, an alarming number of health plans and TPAs will apply that contractual 10% discount on top of the Medicare-based $10,000 (yielding payment of $9,000). Given the large discrepancy between payment of $9,000 and payment of $45,000, it is not difficult to assume that a contracted medical provider will push back, and hard.

Bad Negotiation Tactics: Not Having an End-Game

One of the hallmarks of a successful RBP program is patient protection, which can come in many forms – including direct contracts, case-by-case settlements, balance-bill indemnification, attorney representation, and other options, depending on the particular program used.

Settling claims is perhaps the simplest way of protecting patients; by eliminating balances via settlements, balance-billing is extinguished. Likewise, if a third party offers to indemnify the patient, then the patient is protected in that manner as well – and hiring litigation counsel on behalf of the patient can be an effective tool in combatting balance-billing or spurring settlement negotiations where a provider was otherwise hesitant to negotiate.

As has been proven time and time again, the state of the industry is such that medical providers are generally permitted to charge any amounts they choose. Charge masters are arbitrary yet still enforced by many courts, and providers are free to send patients to collections or file lawsuits when they have not received their full billed charges – and some providers feel even more inclined to do that if the provider has been paid at a percentage of the Medicare rate. Many medical providers treat a Medicare-based payment as a personal assault on the value of their treatment, and seek to abuse health plans even more because of that!

Some consider there to be two “separate” responsibilities to settle RBP claims or otherwise provide patients an avenue of protection from balance-billing – a social responsibility, and a legal responsibility. The social responsibility can be thought of in terms of the employer’s desire to provide its employees with sufficient coverage and a desirable program of health insurance; even though reference-based pricing and balance-billing are permitted by law, most employers utilizing this type of model are typically loathe to allow patients to be balance-billed, and desire to settle claims as part of the normal RBP process. For many employers, seeing a valued employee be sent to collections or become the defendant in a hospital’s lawsuit is the worst-case scenario.

There is, despite popular misconception, a legal responsibility to settle claims as well. A few years ago now, the Department of Labor came out with set 31 of its series on Frequently Asked Questions on the Affordable Care Act. While previous guidance provides that balance-billed amounts do not count toward the patient’s out-of-pocket limit, this FAQ indicates that that rule applies only when there is an “adequate network of providers” who will refrain from balance-billing. When there is no adequate network of providers, however, the guidance suggests that health plans must in fact pay for balance-billed amounts that exceed the patient’s out-of-pocket max.

Although the Department of Labor has neglected to provide additional guidance and make sure people understand what the FAQ guidance really means, the general opinion is that health plans must have a systematic program of settling balance-bills one way or another – and in fact most health plans utilizing RBP do have some system, whether direct contracts, a narrow network, or simply making sure they settle claims on the back-end. This is certainly a relevant factor for reference-based pricing, but not necessarily one that is prohibitive. This is an indication that RBP must evolve in order to remain compliant – and evidence that the threat of walking away the negotiation table may not be an option for many health plans.

Thinking That RBP is “All or Nothing”

When employers are sold on RBP by TPAs, brokers, or vendors, often those entities fall into the common sales trap of promoting only the positive aspects of RBP, without painting a full picture of some of the potential snares as well. As a result, since RBP results do tend to add value, many employers immediately jump to leaving their respective PPO networks and applying the RBP methodology to all claims. After all, more claims subject to RBP theoretically means more added value, right?

In practice, however, it often proves extremely beneficial to utilize some system of agreements as part of the overall RBP process. This ensures that employees have “safe harbors” to visit, promoting employee security, ease of use, and even compliance (see above!).

There are no pre-set requirements for what RBP is or is not; though many enter into it with a set of preconceived notions of how it should work, an RBP program can be tailored to suit a given health plan’s needs (subject to the vendor’s and TPA’s standard practices and capabilities, of course). Many health plans using RBP combine it with narrow networks, direct provider contracts, physician-only networks, or even primary networks (using RBP only for out-of-network claims).

Since RBP is meant only for non-contracted claims (see above, again!), RBP can in theory be used for any claims that the health plan has not previously agreed to pay at a certain rate.

On that note, the last point:

Not Realizing that RBP is Just U&C for the Modern Era!

When providers say “we expect payment at U&C” or similar things, it can be useful to take a step back and think about what RBP really is. At its core, RBP is just a way of pricing claims. It’s not a unique type of health plan, nor is it a way of changing the claims processes. It’s simply a way to determine how much money to pay on a given claim.

“Hang on,” you may be saying, “but isn’t that what Usual and Customary is?” Yes, it is! RBP can be conceptualized in many ways, but one of the most familiar is as a way of determining U&C. Just like RBP, “Usual and Customary” is not necessarily a pre-set term with a well-defined meaning; it is the way that a health plan determines what is payable. Interestingly, hospitals tend to suggest that “U&C” has to be defined as what other area providers charge for the same service, yet there is no support for that requirement. In fact, many health plans define “usual and customary” as an amount that hospitals commonly accept as payment for a given code. That can take into account private payors and even – gasp! – Medicare.

The employer determines the definitions within the Plan Document. If your plan defines its payable amount as U&C, and bases that amount on Medicare rates, then you can honestly say that your plan does pay U&C.

In conclusion: take care to ask your vendor – or potential vendor – lots of questions about their processes and how they manage these and other elements of their respective programs. With so many vendors in the industry, there can be lots of conflicting information, so make sure you’ve got your facts straight prior to signing on the dotted line.

__________________________________________________________________________________________

How Self-Insured Health Plans Are Helping Employers Compete In A Challenging Talent Marketplace

By: Philip Qualo, J.D.

Prior to joining The Phia Group, LLC, an experienced health care cost-containment company specializing in self-insured plans, my knowledge and experience with the self-insured industry could fit on the tip of my pinky. My previous work experience was exclusively in the fully-insured sector, where I quickly learned that uttering the words “self-insurance” was considered almost offensive. On a more personal level, I had been covered under various fully-insured health plans since my very first job after graduating law school. From the start, my experience with fully-insured plans jaded my perception of health benefits.  I eventually accepted that medical insurance was a necessary evil that I would have to learn to live with. Although my employers genuinely cared about the well-being of their employees, the ability to offer comprehensive medical benefits became increasingly difficult due to the monumental annual increases in the cost of fully-insured coverage. 

As employers who sponsor fully-insured health plans are generally limited to an “off the shelf” one size fits all plan options designed by their respective carriers, the limited ability to design benefits to meet the specific needs of their employees is an additional obstacle. As a fairly healthy individual who has never broken a bone or required surgery (knock on wood), I have spent most of my adult life stuck paying a premium for benefits that I rarely used. I viewed medical insurance as an unpleasant necessity, expensive but necessary just in case I was hit by a bus. This was especially the case when I experienced the dreaded fully-insured high deductible health plan. Although high deductible plans have become a popular compromise for employers to keep healthcare premiums at an affordable rate, as a low claims plan participant I struggled with the fact that I was not only paying a high premium, but also paying out of pocket for occasional provider visits and generic medications from my own hard-earned money. Due to my infrequent need to seek medical services, in all my years covered by a high deductible health plan, I never reached my deductible amount – not once. So, in reality, I was paying for coverage that I never really used.  Unfortunately, the astronomical profits that fully-insured carriers were reporting at that time did not help to alleviate what I perceived as an unpleasant necessity.

Then I interviewed with The Phia Group, my current employment, who not only specializes in self-insured health plans, but practices what they preach by sponsoring their own self-insured health plan for their employees. Where most employers usually avoid describing their health benefits in the interview process, my experience interviewing with The Phia Group was complete the opposite, and opened my eyes to not only the beauty of self-insured health plans, but how it can be used as an effective recruiting tool. “Ummm… can you repeat that?”, I exclaimed, as my eyes widened in bewilderment. “Which part?”, the Talent Acquisition Specialist asked, “The part about no co-pay for generic medications, no co-pay if I choose to take part in the Direct Primary Care (“DPC”) program, or the list of  incentives that can actually result in extra cash in your pocket for helping the plan contain costs?” Needless to say, this was the first time ever, in my lengthy professional career that I ever considered healthcare benefits as a factor in making my decision to work for an employer. Since enrolling in our health plan over a year ago, my health plan contributions have been consistent and more affordable than they’ve ever been. Most importantly, my trauma from paying the full cost for health services under a fully-insured high deductible health plan had finally faded, as the total I have spent on healthcare since I joined The Phia Group has totaled $0. This is when I first realized how important offering and sponsoring a self-insured plan can be, as self-insurance can be  an employer’s “secret weapon” for marketability in an ever-increasing competitive market for top talent.

Why is There a Struggle to Find & Retain Top Talent?

In May 2019, the White House announced that the unemployment rate in United States had dropped to 3.6 percent—the lowest unemployment rate since December 1969, according to a Bureau of Labor Statistics’ (“BLS”) household survey. Although this was great news for our economy as a whole, a low unemployment rate can be a challenge for employers seeking to expand their workforce and attract and retain top talent. Although U.S. job growth has been consistently strong, a low unemployment rate indicates there are more jobs than there are job seekers.

Another challenge employers are currently facing is increasingly high turnover rates, or what is generally referred to as high “quit rates” meaning voluntary separations initiated by employees. According to the April 2019 Bureau of Labor Statistics Job Openings and Labor Turnover Survey Highlights, high quit rates are indicative of a robust job market. Therefore, the quit rate can serve as a measure of workers' willingness or ability to leave jobs. According to the survey, there were 3.5 million quits in the U.S. in April 2019. This number far exceeded the number of discharge or layoffs for April, which was estimated at 1.8 million. Employers who sponsor self-insured plans and who choose to use the services of Third Party Administrators (“TPAs”) have been found to save more money on their health plans per enrolled person than they would have with traditional insurance. This is because TPAs work to manage an employer’s self-insured plan based on the employer’s specifications instead of according to an insurance carrier’s policy.

The Recruiting & Retention Advantages for Employers Who Sponsor Self-Insured Health Plans 

Due to the limited pool of job seekers, and increasingly high quit rates, employers are reviewing their compensation packages, and more importantly, their benefit offerings, to determine what leverage they have to compete in this employee-centered job market.  In a 2017 survey conducted by the Society for Human Resource Managers (“SHRM”) on the strategic use of benefits, the results yielded that organizations that take a strategic approach to their benefits programs, by leveraging benefits to recruit and retain employees, are nearly twice as likely to have more satisfied employees and to report better business performance compared with organizations that are not strategic with their benefit programs. This survey  reveals that benefits are a key driver in recruitment and job satisfaction. If an employer’s offerings fail to meet employees’ health and financial demands, they risk losing top talent to organizations with more complete coverage options.

Employers who sponsor a self-insured health plan have a notable advantage over employers who offer fully-insured coverage, especially when it comes to adjusting their benefits to  attract top talent. In order too meet the unique needs of job seekers and candidates as well as current employees, self-insured health plans allow for more flexibility and control over the terms of a plan. Employers have the opportunity to work directly with their service providers to customize their benefits to fit their needs and adjust them over time as needed. More importantly, plan sponsors have the ability to incorporate cost-containment incentives for their employees that allows the employer to not only save money, but also use those savings to enhance their plan offerings and offer them at a low cost. On the other hand, employers who offer fully-insured health plans are generally limited to the costly options available from the carriers within their respective states. In this context, budget conscious employers are usually forced to forego the more comprehensive health plan for the most affordable option, which usually has less than favorable coverage and results in employee dissatisfaction.

Bottom Line

According to a survey conducted by America’s Health Insurance Plan, 56 percent of U.S. adults with employer-sponsored health benefits said that whether or not they like their health coverage is a key factor in deciding to stay at their current job. In addition, the survey found that 46 percent of U.S. adults said health insurance was either the deciding factor or a positive influence in choosing their current job.

For employers who offer self-insured health coverage, the ability to design and modify their plans and enhance savings can be a valuable resource to attract top talent in this expanding job market. In sum, communicating the value of self-insured health benefits to job-seekers, potential job candidates, and existing employees, can be an employer’s secret weapon in competing for talent in this job market as well as employee retention.

__________________________________________________________________________________________

Big Pharma Facing Big Losses Tied To Opioid Epidemic Fallout

By: Sean Donnelly, Esq

Background

In 2017, a total of 70,237 people in the United States died from a drug overdose.  A staggering 67.8% of those deaths involved the use of opioids, a startling escalation that has been classified as a national epidemic.  Deaths attributed to synthetic opioids have become increasingly prevalent, accounting for 59.8% of all opioid overdose deaths.

Every day, an average of 46 people in the United States die from overdoses specifically involving prescription opioids.  The highest prescription opioid-involved death rates in 2017 were in West Virginia, Maryland, Kentucky and Utah1.  According to the National Institute on Drug Abuse, drug overdose deaths involving opioids that were prescribed rose from 3,442 in 1999 to 17,029 in 20172.

In particular, oxycodone (such as OxyContin®), hydrocodone (such as Vicodin®), methadone, and fentanyl have been identified as the most common drugs associated with prescription opioid overdose deaths3.  Fentanyl, a synthetic opioid used to treat severe pain, is one of the chief agents being linked to the recent rash of drug overdose deaths.  In 2011, Fentanyl was identified as being the cause of 1,663 deaths; in 2016, that figure surged to 18,335 deaths4.  Natural and semi-synthetic opioids, a category that includes oxycodone and hydrocodone, accounted for 14,495 deaths in the United States in 20175.  On a molecular level, oxycodone is nearly identical to heroin6.   

States Fight Back

Massachusetts

In the last decade, more than 11,000 people died from opioid-related overdoses in Massachusetts alone7.  Massachusetts patients who were prescribed opioids for more than one year were 51 times more likely to die of an opioid-related overdose8.  The Attorney General for Massachusetts, Maura Healey, alleged in a recent lawsuit9 against Purdue Pharma that the pharmaceutical giant possessed actual knowledge that its prescription opioid OxyContin was leading to overdose deaths.  Since 2009, in Massachusetts alone, 671 people who filled prescriptions for opioids manufactured by Purdue ultimately died from an opioid-related overdose10.  Yet, Healey claims that the company turned a blind eye towards the evidence of OxyContin’s addictive qualities and instead engaged in a large-scale sales blitz in Massachusetts to push sales of the prescription drug while deceiving doctors and patients.  Pleadings filed by Healey assert that Purdue’s OxyContin offensive included threatening to fire sales reps whose physician targets failed to write sufficient opioid prescriptions, advocating that the powerful drug be used to treat elderly patients with arthritis, and obscuring the risk of addiction in its marketing materials. 

Healey’s case focuses on Purdue’s deceptive practices, which allegedly included making misleading claims in order to push more patients onto its opioids at higher doses and for longer amounts of time, while simultaneously diverting patients away from safer alternatives11.  Additional counts charge Purdue with creating a public nuisance of addiction, illness, and death and interfering with the public health by engaging in deceptive marketing practices that fostered a dangerous epidemic of opioid addiction in the state12.  Further, Healey contends that Purdue acted negligently and recklessly with regard to the known risks of its drugs13, including by intentionally targeting high-prescribing doctors and rewarding them with gifts and money in exchange for them prescribing more Purdue opioids14, even when Purdue knew that its opioids were being misused and harming patients.  In one instance, Purdue’s governing board had allegedly been warned by staff that two Massachusetts doctors had prescribed opioids inappropriately, but it failed to notify medical licensing officials.  Purdue made more than $823,000 off those two doctors alone in just two yearsi.

In March, Purdue’s attorneys filed a second motion to dismiss the case that labeled Healey’s allegations as “oversimplified scapegoating,” countering that the company neither created nor caused the opioid epidemic in Massachusetts15.  Instead, Purdue made the case that unlawful opioids like heroin and illicitly-produced fentanyl were the root cause of the great majority of opioid-related overdose deaths in Massachusetts16.  Accordingly, Purdue claimed that its FDA-approved OxyContin could not, as a matter of law, be considered the proximate or but-for “cause” of the state’s opioid crisis17.  The Massachusetts Attorney General’s Office is currently opposing Purdue’s motion.

Oklahoma

Oklahoma ranked as the leading state in the nation in terms of amount of opioids distributed per adult resident in 201618.  In 2018, nearly fifty percent of drug overdose deaths in Oklahoma were caused by pharmaceutical drugs.  In that same year, of the more than 3,000 Oklahoma residents who were admitted to a hospital for a non-fatal overdose, eighty percent of those overdoses were due to prescription opioid medications19.  At the epicenter of this epidemic, Purdue Pharma was again in the crosshairs of a state lawsuit centered on opioid addiction.  The case brought by Oklahoma, originally filed in June 2017 by the Oklahoma Attorney General’s Office, named opioid manufacturers Purdue Pharma, Johnson & Johnson, and Teva Pharmaceuticals as defendants.  Rather than face a televised trial, Purdue in this instance elected to settle with the state to the tune of $270 million.  The settlement funds will be used to establish an almost $200 million endowment at the Oklahoma State University’s Center for Wellness and Recovery for the purpose of addiction treatment and research.  More than $100 million of the settlement proceeds will be used to fund a new addiction treatment and research center at Oklahoma State University.  $20 million of that amount will be earmarked for addiction treatment medicines.  Another $12.5 million in settlement funds will be dedicated to use by cities and counties to help fight the opioid epidemic.  In late May, Teva Pharmaceuticals reached its own $85 million settlement with the state.  The case against the remaining defendant, Johnson & Johnson, is moving forward with a bench trial that began on May 28th

The complaint filed by the Oklahoma Attorney General20, Mike Hunter, revealed that Purdue’s OxyContin sales skyrocketed from $48 million in 1996 to $3 billion in 200921.  Hunter alleged that Purdue misrepresented the risks of opioid addition in its marketing materials and promoted unproven benefits in an effort to boost sales.  According to the complaint, Purdue caused “catastrophic damage” in Oklahoma by engaging in a false and deceptive marketing campaign that deluded both doctors and patients into thinking Purdue’s opioids were actually less harmful than had originally been warned by the medical community22.  Specifically, Hunter claims that Purdue falsely downplayed the risk of addiction associated with OxyContin and erroneously maintained that scientific studies had supported the prescription drug’s low risk of addiction23.  One Purdue sales manager is quoted in the complaint as being trained to say that OxyContain was “non-habit forming,” going so far as to admit he was instructed “to say things like [OxyContin] is ‘virtually’ non-addicting…It’s not right, but that’s what they told us to say.”24  The complaint also alleged that Purdue misrepresented the benefits of its opioids, including by falsely promoting that OxyContin had been studied for use with arthritis and recommending that it was effective in treating chronic non-cancer related pain25.  Abbe Gluck, a professor at Yale Law School, theorized that Purdue’s decision to settle the case was largely driven by its apprehension that these allegations by the state would be “publically aired against it during a televised trial,” thereby risking “exposure to what could have been an astronomical jury verdict.”26       

New York

For the first time since the onset of the opioid crisis, criminal charges have been levied against the individual executives running a drug distribution company.  The United States Attorney’s Office for the Southern District of New York (USAO), in cooperation with the New York Division of the U.S. Drug Enforcement Administration (DEA), announced in late April that criminal charges were filed against two executives of Rochester Drug Co-Operative, Inc.  Rochester, which is one of the largest wholesale pharmaceutical distributors in the United States, was accused of unlawfully distributing both oxycodone and fentanyl and conspiring to defraud the DEA.  Most notably, the company’s former chief executive officer and former chief compliance officer were both individually charged with the illegal distribution of controlled substances, a felony offense.  For its part, Rochester admitted culpability for the unlawful distribution and agreed to pay a $20 million fine and allow for future oversight of it operations by an independent monitor.  If Rochester adheres to the government’s terms over the next five years, the USAO has agreed to dismiss the charges against the company.  The press release from the USAO underscored that the unprecedented charges “should send shock waves throughout the pharmaceutical industry reminding them of their role as gatekeepers of prescription medication.”27 

With respect to the individual executives, the USAO alleged that they conspired to distribute oxycodone and fentanyl outside of the scope of professional practice and not for a legitimate medical purpose28.  The indictment alleges that they willfully failed to report suspicious orders of controlled substances to the DEA and likewise failed to advise the DEA that Rochester’s customers were diverting the controlled substances for illegitimate use29.  In particular, over an approximately five-year period, Rochester received 412 orders of fentanyl and 2,530 orders of oxycodone from its pharmacy customers that the company designated as “suspicious.”30  Of those almost 3,000 orders that Rochester’s internal compliance team red-flagged, the former executives only reported four total orders to the DEA at the direction of Rochester’s former CEO31.  One member of Rochester’s compliance team explicitly warned the CEO and other executives that this practice could place the company in the DEA’s “cross-hairs…because of [its] willful blindness and deliberate ignorance.”32  The former executives were also cited with having lied to the DEA about conducting due diligence on new pharmacy customers when no proper review was ever performed33.  These customers were ultimately supplied with opioids from Rochester despite the company and its executives allegedly knowing that the drugs were in turn being sold and used illicitly34.  Laurence Doud, the former CEO, was charged with one count of conspiracy to distribute controlled substances, which carries a maximum sentence of life in prison and a mandatory minimum sentence of 10 years, and one count of conspiracy to defraud the United States, which carries a maximum term of 5 years.  William Pietruszewski, the former Chief Compliance Officer, pled guilty in April to charges of conspiracy to distribute controlled substances, conspiracy to defraud the United States, and failing to file suspicious order reports with the DEA.                         

Proactive Options for Self-Funded Plans

Plan participants that misuse or intentionally abuse prescription opioids are more likely to incur high-dollar medical charges, whether in the form of emergency room visits, lengthy inpatient hospital stays, or recurrent physician visits.  Statistics provided by the Centers for Disease Control and Prevention indicate that over 1,000 people per day receive emergency medical services as a result of misusing prescription opioids35.  In 2014, there were over 1.27 million emergency room visits and hospital inpatient stays for opioid-related issues, which represented a 99% increase for emergency room treatment and 64% increase for inpatient care from just 200536.  These increased emergency room visits, extended hospitalizations, and even a rise in workers’ compensation claims stemming from opioid addiction are putting a considerable financial strain on employers and the plans they sponsor.  Opioid abuse can cost an employer-sponsored plan an additional $10,000 to $20,000 in annual excess costs per patient37.  Almost one-third of prescription painkillers covered by employer-sponsored plans are abused38.  Fortunately, there are a number of options available to self-funded plans to combat the epidemic and mitigate the rising costs associated with opioid abuse:

  1. Plan Design – Employers can customize their plans to discourage opioid abuse and instead incentivize participants to utilize pain management alternatives, such as acupuncture, chiropractic care, physical and behavioral therapy and heat-focused massage. 
  2. Insist on Compliance with CDC and FDA Guidelines – Employer-sponsored plans should confirm whether the providers in their networks are properly following opioid prescription guidelines established by the Centers for Disease Control and Prevention (CDC).  The CDC guidelines were established as a baseline for providers to follow to better ensure that opioids are prescribed safely and appropriately in order to minimize the chances of abuse or misuse.  Additionally, plans should take steps to make sure their participants are aware of, and diligently follow, the Food and Drug Administration’s (FDA) guidelines that instruct patients on how to properly discard surplus opioids before they can be accessed by other household members who do not have a prescription.     
  3. Establish a Limit – CDC studies have revealed that the likelihood of a patient becoming addicted to opioids spikes on day four of use.  Consequently, Plans may want to consider placing a three-day limit on the use of opioid prescriptions for initial pain treatment39.  Plans should work directly with their utilization management vendor and pharmacy benefit manager to establish strict dosage caps and dispensation/refill limits.     
  4. Plan Participant Education – Employers need to take proactive steps to ensure that their employees are fully-informed of the dangers of opioid addiction and misuse.  Group discussions and annual meetings are useful forums for discussing the dangers of opioid side effects, recognizing the symptoms of painkiller abuse, and identifying helpful resources available to employees such as substance abuse hotlines.
  5. Identify Vulnerable Participants – Plans should analyze their prescription drug data to identify plan participants with a history of excessive prescription drug use who may be more prone to abusing opioids.  Plans should then work with their vendors and administrators to preemptively reach out to providers and pharmacists in order to steer susceptible participants towards pain management alternatives, establish prescription limitations, and make such participants aware of assistance networks and other resources at their disposal to help them through substance abuse issues.   

1Preceding statistics derived from Scholl L, Seth P, Kariisa M, Wilson N, Baldwin G. Drug and Opioid-Involved Overdose Deaths — United States, 2013–2017. MMWR Morb Mortal Wkly Rep 2019;67:1419–1427. DOI: http://dx.doi.org/10.15585/mmwr.mm675152e1.  

2See National Institute on Drug Abuse, Overdose Death Rates (Revised January 2019). Retrieved from: https://www.drugabuse.gov/related-topics/trends-statistics/overdose-death-rates.

3Prescription Opioid Data, Centers for Disease Control and Prevention.  Dec. 19, 2018.  Retrieved from: https://www.cdc.gov/drugoverdose/data/prescribing.html.  

4Spencer, Merianne Rose; Warner, Margaret; Bastian, Brigham A.; Trinidad, James P.; and Hedegaard, Holly. National Vital Statistics Reports (Vol. 68, No. 3). National Center for Health Statistics, Centers for Disease Control and Prevention. Mar. 21, 2019. Retrieved from: https://www.cdc.gov/nchs/data/nvsr/nvsr68/nvsr68_03-508.pdf.

6First Amended Complaint at 8, Commonwealth of Massachusetts v. Purdue Pharma, L.P., et al, Mass. Superior Court, 1884-CV-01808 (BLS2). 

7Complaint at 4, Commonwealth of Massachusetts v. Purdue Pharma.

8First Amended Complaint at 8, Commonwealth of Massachusetts v. Purdue Pharma.

9See Commonwealth of Massachusetts v. Purdue Pharma, L.P., et al, Mass. Superior Court, 1884-CV-01808 (BLS2).

10First Amended Complaint at 9, Commonwealth of Massachusetts v. Purdue Pharma

11First Amended Complaint at 10, Commonwealth of Massachusetts v. Purdue Pharma

12First Amended Complaint at 270-272, Commonwealth of Massachusetts v. Purdue Pharma.    

13First Amended Complaint at 272, Commonwealth of Massachusetts v. Purdue Pharma.

14First Amended Complaint at 12, Commonwealth of Massachusetts v. Purdue Pharma.

15Purdue’s Memorandum of Law in Support of its Motion to Dismiss Amended Complaint at 1, Commonwealth of Massachusetts v. Purdue Pharma

16Purdue’s Memorandum of Law in Support of its Motion to Dismiss Amended Complaint at 5, Commonwealth of Massachusetts v. Purdue Pharma.

17See Purdue’s Memorandum of Law in Support of its Motion to Dismiss Amended Complaint at 3, Commonwealth of Massachusetts v. Purdue Pharma.

18Petition at 2, State of Oklahoma v. Purdue Pharma L.P. et al., District Court of Cleveland County, State of Oklahoma, CJ-2017-816. 

19Gerszewskii, Alex. Attorney General Hunter Announces Historic $270 Million Settlement with Purdue Pharma, $200 Million to Establish Endowment for OSU Center for Wellness. Office of the Oklahoma Attorney General. Mar. 26, 2019.  Retrieved from http://www.oag.ok.gov/attorney-general-hunter-announces-historic-270-million-settlement-with-purdue-pharma-200-million-to-establish-endowment-for-osu-center-for-wellness.

20See State of Oklahoma v. Purdue Pharma L.P. et al., District Court of Cleveland County, State of Oklahoma, CJ-2017-816.

21Petition at 1, State of Oklahoma v. Purdue Pharma.

22Petition at 12, State of Oklahoma v. Purdue Pharma.

23Petition at 12, State of Oklahoma v. Purdue Pharma.

24Petition at 13, State of Oklahoma v. Purdue Pharma.

25Petition at 12-13, State of Oklahoma v. Purdue Pharma.

26Hoffman, Jan. Purdue Pharma and Sacklers Reach $270 Million Settlement in Opioid Lawsuit.  The New York Times.  Mar. 26, 2019.  Retrieved from: https://www.nytimes.com/2019/03/26/health/opioids-purdue-pharma-oklahoma.html.

27Manhattan U.S. Attorney And DEA Announce Charges Against Rochester Drug Co-Operative And Two Executives For Unlawfully Distributing Controlled Substances. The United States Attorney’s Office – Southern District of New York. Apr. 23, 2019. Retrieved from: https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-and-dea-announce-charges-against-rochester-drug-co-operative-and.

28Information at 1, U.S. v. Pietruszewski, U.S.D.C. for the S.D.N.Y., 19-cr-___ (WHP).

29Information at 2-3, U.S. v. Pietruszewski.

30Information at 3, U.S. v. Pietruszewski.

31Information at 3, U.S. v. Pietruszewski.

32Indictment at 5, U.S. v. Doud, U.S.D.C. for the S.D.N.Y., 19-cr-285. 

33Information at 4, U.S. v. Pietruszewski.

34Information at 4, U.S. v. Pietruszewski.

35Petition at 10, State of Oklahoma v. Purdue Pharma.

36Petition at 10-11, State of Oklahoma v. Purdue Pharma.

37Kirson, Noam Y.; Scarpati, Lauren M.; Enloe, Caroline J.; Dincer, Aliya P.; Birnbaum, Howard G.; and Mayne, Tracy J.  The Economic Burden of Opioid Abuse: Updated Findings. Journal of Managed Care & Specialty Pharmacy. Vol. 23, Issue 4.  Retrieved from: https://www.jmcp.org/doi/10.18553/jmcp.2017.16265.  

38Coombs, Bertha. U.S. Companies Losing $10B a Year Due to Workers’ Opioid Abuse. CNBC. Apr. 20, 2016. Retrieved from: https://www.nbcnews.com/business/business-news/u-s-companies-losing-10b-year-due-workers-opioid-abuse-n559036.

39For a full description of the first three options and other useful measures available to plans see: Qualo, Philip. The Opiod Crisis: How Employers & Self-Funded Health Plans Can Combat This Epidemic. The Phia Group. Mar. 5, 2019. Available at: https://www.phiagroup.com/Media/Posts/PostId/830/the-opioid-crisis-how-employers-self-funded-health-plans-can-combat-this-epidemic.

iWillmsen, Christine and Bebinger, Martha. Massachusetts Attorney General Implicates Family Behind Purdue Pharma in Opioid Deaths. WBUR.  Jan. 16, 2019.  Retrieved from: https://www.npr.org/sections/health-shots/2019/01/16/685692474/massachusetts-attorney-general-implicates-family-behind-purdue-pharma-in-opioid-.   

The Phia Group's 3rd Quarter 2019 Newsletter

On July 19, 2019


Phone: 781-535-5600 | www.phiagroup.com

 


The Book of Russo:
From the Desk of the CEO

Greetings from the beautiful city of... Braintree, Massachusetts! We are excited about the weeks and months ahead, where - like the weather - things are heating up at The Phia Group. Unlike some others in the industry who look at the summer as a time to kick back and relax, we here at The Phia Group are putting the finishing touches on not one, but TWO huge offerings and upgrades in the coming weeks. When it comes to our mission of empowering plans, and ensuring employers can offer their employees and families the highest quality benefits and health care, for the lowest cost, we never rest. Indeed, we know that this is the time of year you spend preparing for the upcoming renewal and retention season. The services and expertise we provide today will be the tools you use to ensure your continued growth and success tomorrow. I hope you are enjoying your summer thus far - Happy reading, and don't forget the sunblock.


Service Focus of the Quarter: Plan Appointed Claim Evaluator® (PACE)
Phia Group Case Study
Phia Fit to Print
From the Blogosphere
Webinars
Podcasts
The Phia Group’s 2019 Charity
The Stacks
Phia’s Speaking Events
Employee of the Quarter
Phia News

 

Service Focus of the Quarter: Plan Appointed Claim Evaluator® (PACE)

Some years ago, in response to growing industry concerns regarding fiduciary duties, The Phia Group created its Plan Appointed Claim Evaluator (PACE) service. PACE is a fiduciary transfer service addressing final-level internal appeals. It is designed to help plans ensure they made correct determinations, thereby insulating the health plan from liability and allowing the Plan Administrator to focus on its core business rather than difficult fiduciary determinations.

PACE includes:

• Plan Document and stop-loss policy “Gap Reviews,” to both ensure compliance as well as eliminate coverage gaps, all while also ensuring PACE readiness;
• Advanced-level webinars exclusively for PACE clients;
• Assessment of eligible final internal appeals via written directives; and,
• Unsurpassed legal analysis, clinical review and access to URAC-accredited IROs (with PACE covering all external review costs).

Beginning August 2019, we will also begin offering complimentary PACE Certification – whereby your organization can enhance your PACE business, improve your internal appeals processes, ensure regulatory compliance, and improve your business as a whole. Chapter One of PACE Certification explores the ins and outs of self-funding; Chapter 2 takes a deeper dive into the laws and regulations applicable to self-funded health plans; Chapter 3 explains what PACE is, how it works, and how it can best be utilized.

Tim can be reached by phone at 781-535-5631 or by email at TCallender@phiagroup.com.

 

Phia Case Study: The Tale of the Reluctant ASC

The Phia Group was presented with a file, as part of its Phia Unwrapped service, where a patient had visited an out-of-network ambulatory surgery center (ASC), and was receiving a balance-bill following the plan’s payment. The health plan adjudicated the claim based on 145% of Medicare rates, whereas the claim was billed at a whopping 1,430% of Medicare. Needless to say, a large balance ensued.

The ASC informed The Phia Group’s team that it would not accept any reduction in its billed charges, under any circumstances, and it cited a dozen bogus arguments about how state and federal law prohibited the health plan from utilizing this particular payment methodology.

The Phia Group’s legal team put together a strong response to each argument raised by the ASC; we then followed up after one week, and were told the letter was still being reviewed. We followed up after another week, and were told the same thing. Fast-forward two months: same answer. Still being reviewed!

Our legal team pressured the ASC for a response, informing them that our client was considering closing its file and walking away with no possibility of additional payment.

Two weeks later, we finally received a positive response, and our efforts yielded an ultimate settlement at only 18% of billed charges.

 


_

 

Fiduciary Burden of the Quarter: Managing Conflicting Agreements

Have you ever seen a health plan incur an in-network claim that is billed at many times the appropriate rate defined in the Plan Document? If so, you’re not alone.

Have you ever reviewed that in-network claim against the terms of the Plan Document, and then denied the portion exceeding the Plan Document’s terms? If so, you’re still not alone.

Have you ever received pushback from that in-network provider, demanding the network rate? If so, you’re still not alone.

It’s certainly true that the Plan Document prescribes certain limitations on claims payments – but it’s also true that network contracts don’t take those limitations into account, and instead require payment based on a percentage off billed charges. Not appropriate billed charges, or allowed billed charges; just billed charges.

For that reason, it’s crucial to be aware of what all the relevant contracts say; the Plan Document and the network contract are conflicting, but neither “overrules” the other. That is, the payor has promised to pay two separate amounts – one in the Plan Document and one in the network contract – and of course medical providers are going to expect the higher of those two amounts. Add to that the fact that the provider has privity to the contract guaranteeing the higher amount, and we’ve got a situation on our hands.

Moral of this story? Make sure your Plan Document language is synced up to your network contracts! Try to avoid placing a hard limit on all claims payments, instead focusing on non-contracted claims, since once a claim has a contract whereby it must be paid at a certain rate, the Plan Document’s global limitations across all claims cannot be applied without violating that contract!

 

Success Story of the Quarter: The Non-Responsive Plaintiff’s Attorney

The Phia Group identified a particularly large potential recovery for a client. The patient in question was involved in a motor vehicle accident, and had engaged legal counsel to pursue damages from a wealthy defendant. It seemed likely that this patient would receive a settlement far larger than the health plan’s lien, and The Phia Group put the patient’s attorney on notice of the lien.

Well, we tried, anyway.

The attorney didn’t respond to our letter. Or our phone call. Or any of our subsequent letters or phone calls. Our legal team explored all available avenues, and even spoke to former law firm partners of the attorney, but to no avail.

Finally, our attorneys drafted a very strongly-worded letter, reminding the attorney of his legal obligations, and – with our client’s blessing – informing the attorney that if he did not live up to his legal and ethical obligations, we would gladly have the state bar issue him a more stern reminder of his responsibilities as an attorney.

Our legal team received a prompt, courteous, and apologetic response from the attorney, along with an assurance that the plan will be reimbursed in full from that settlement (assuming the payout exceeds the plan’s lien).

 


 

Phia Fit to Print:

• BenefitsPro – Medical cannabis: Should your health plan cover it? – June 26, 2019

• BenefitsPro – Impact of HHS’s Proposed ACA Revisions to Employers – June 19, 2019

• Self-Insurers Publishing Corp. – Seasons of Change: How to successfully implement evolving healthcare trends – June 10, 2019

• BenefitsPro - What is subrogation, and how does it affect health benefit plans? – June 3, 2019

• BenefitsPro – Paid leave policies: Picking up steam or is it just hot air? – May 20, 2019

• Self-Insurers Publishing Corp. – Transparency - A Clear and Almost-Present Danger? – May 5, 2019

• BefefitsPro - Getting ahead of ERISA disbursement claims – April 8, 2019

• Self-Insurers Publishing Corp. – The Lien, Mean, Subrogation Machine – April 4, 2019

 



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From the Blogosphere:

List Prices in TV Ads: Will This Help? Price transparency may be making its way to a TV near you.

Big Pharma Executives Testify Before Congress (Again). This could be a tough pill to swallow for big pharma companies.

The Final AHP Rules Take a Hard Hit! There were a lot of bumps and bruises along the way.

New DOL Opinion Letter: Employers May Not Delay FMLA Leave Designations. Do you have questions about the FMLA? Here are your answers.

Be Transparent – Tell Me What You Really Want! The most expensive options aren’t always the best options.

To stay up to date on other industry news, please visit our blog.



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Webinars

 

• On June 20, 2019, The Phia Group presented, “The Impact of State, Federal Laws, and Current Market Trends on Self-Funding,” where we share some interesting perspectives on the current legislative climate.

• On May 23, 2019, The Phia Group presented, “To Pay, or Not to Pay … The Guide to Handling Claims, Denials, and Appeals,” where we discussed the good, bad, and ugly truths about the claims process, and how to safely navigate the various TPA and health plan duties associated with it.

• On April 22, 2019, The Phia Group presented, “Evolving Healthcare Issues and Events You Need to Know,” where we discussed some of the most relevant topics affecting our industry, and explain what they mean to you and your business.

Be sure to check out all of our past webinars!



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Podcasts:

Empowering Plans
 

• On June 26, 2019, The Phia Group presented “Surprise? Balance Bills!,” where our hosts define surprise balance billing and discuss movements to curb them (at the State and Federal levels).

• On April 12, 2019, The Phia Group presented “A Healthcare Free-for-All,” where our hosts, Adam, Ron, and Brady tackle the most pressing issues facing our industry, including surprise emergency room bills, drug pricing, medical necessity, and employee incentive programs. Face of Phia

 

Face of Phia

 

• On June 12, 2019, The Phia Group presented, “Glutton for Punishment,” where our hosts sit down with Amanda Lima, as she celebrates more than six years with Phia and working closely with Adam.

• On May 7, 2019, The Phia Group presented, “Pat 'the Man' Santos Has Got it In the Bag,” where our hosts sit down with Pat 'the Man' Santos – our silent producer.

• On April 17, 2019, The Phia Group presented, “Reminiscing with Andrew,” where our hosts, Adam and Ron, reminisce on Andrew Silverio's Undergraduate adventure.

• On April 5, 2019, The Phia Group presented, “Tales From The Lost Filing Room,” where our hosts, Adam and Ron, dig up tales from the days of old with future industry leader and veteran employee, Amanda Grogan. Tales From the Plan

 

Tales From the Plan

 

• On June 14, 2019, The Phia Group presented, “Putting the Benefit in Benefit Plan with Jennifer McCormick,” where our hosts, Adam and Ron, interview The Phia Group’s Sr. VP of Consulting, Jennifer McCormick, about her own experience as a consumer of healthcare and member of The Phia Group’s health plan.

Be sure to check out all of our latest podcasts!

 

 



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The Phia Group’s 2019 Charity

At The Phia Group, we value our community and everyone in it. As we grow and shape our company, we hope to do the same for the people around us.

The Phia Group's 2019 charity is the Boys & Girls Club of Brockton.

The mission of The Boys & Girls Club is to nurture strong minds, healthy bodies, and community spirit through youth-driven quality programming in a safe and fun environment.

The Boys & Girls Club of Brockton (BGCB) was founded in 1990 to create a positive place for the youth of Brockton, Massachusetts. It immediately met a need in the community; in the first year alone, 500 youths, ages 8-18, signed up as club members. In the 25 years since, the club has expanded its scope exponentially by offering a mix of Boys & Girls Clubs of America (BGCA) nationally developed programs and activities unique to this club.

Since their founding, more than 20,000 Brockton youths have been welcomed through their doors. Currently, they serve more than 1,000 boys and girls ages 5-18 annually through the academic year and summertime programming.

 

Silent Auction

The Phia Group hosted a silent auction to help raise money for the Boys & Girls Club of Brockton. Due to some generous bids and donations made by our valued clients, we were able to raise $12,335.00 for the Boys & Girls Club of Brockton. We couldn’t have done it without the help of our amazing clients and team. If you are interested in donating to the Boys & Girls Club of Brockton, please visit their website today. Every dollar goes towards helping a child in need.

 

Phia Wiffle-Ballers

The Phia Family is one good-looking group of wiffle-ballers! Our wiffle ball team entered the 8th annual John Waldron Memorial Wiffle Ball Tournament, where we were dominated the field. We were up against some fierce competition, including some courageous Brockton Fire Fighters, that most certainly brought the heat. This tournament raised over $30,000! We are proud of the work our team did.

 



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The Stacks

Seasons of Change: How to Successfully Implement Evolving Healthcare Trends

By: Jennifer M. McCormick, Esq. – June 2019 – Self-Insurers Publishing Corp.

Have you ever wondered whether you paid more for your flight than the person next to you on the airplane? What about whether you could be doing more (or less) to save money and time? I’m confident we all frequently ponder what we can do differently to save.

Whether big or small savings, we’re constantly looking for ways save money in all areas of our life. Dinner budgets, car insurance, clothes, general spending - you name it and surely, we have contemplated whether we can reduce that expense. But we also try to balance cost against convenience, expecting to save money and time. For example, we can click a couple of buttons on our phone and groceries appear at our doorstep two hours later, saving us both money and time.

Click here to read the rest of this article


Transparency - A Clear and Almost-Present Danger?

By: Ron E. Peck, Esq. – May 2019 – Self-Insurers Publishing Corp.

Transparency in healthcare, and pricing of care, has been a hot topic – especially for those in our industry – for quite some time. That flame has been fed recently by an increase in regulatory and legislative attention. About one year ago, a bipartisan group of Senators unveiled their intention to launch a healthcare price and quality information transparency initiative, and the feedback has been all over the map.

Click here to read the rest of this article

 

The Lien, Mean, Subrogation Machine

By: Maribel Echeverry McLaughlin, Esq – April 2019 – Self-Insurers Publishing Corp.

In 1990, the United State Supreme Court ruled in FMC Corp. v. Holliday, that state law will not prevent a private self-funded plan governed under ERISA from obtaining reimbursement. Additionally, the Court ruled that any state law that is contrary to ERISA would be preempted if the Plan’s language so provides or there is a clear contradiction to the federal law.

For years, this law went unchallenged until 2006, when Mr. and Mrs. Sereboff were involved in a motor vehicle accident, and the Mid Atlantic Medical Services Employee Health Plan paid related claims in the amount of $74,869.37.

Click here to read the rest of this article

 

To stay up to date on other industry news, please visit our blog.

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Phia’s 2019 Speaking Engagements:



• 1/9/2019 – FMMA Conference – Austin, TX

• 2/27/2019 – Sunlife 2019 MVP Academy – Denver, CO

• 3/8/2019 – UnitedAg Conference – Anaheim, CA

• 3/19/2019 – SIIA Self-Insured Health Plan Executive Forum – Charlotte, NC

• 3/21/2019 – CGI Business Solutions Seminar – Woburn, MA

• 3/26/2019 – HFTA Broker Meeting – Tyler, TX

• 4/3/2019 – BenefitsPRO Broker Expo – Miami, FL

• 4/5/2019 – Pareto Conference – Nashville, TN

• 4/7/2019 – Captive Symposium – Cayman Islands

• 4/8/2019 – National Beer Wholesalers Association Legislative Conference – Washington DC

• 4/12/2019 – FMMA 2019 Annual Conference – Dallas, TX

• 4/23/2019 – Johns Hopkins Industry Education Series – Baltimore, MD

• 4/24/2019 – Sunlife 2019 MVP Academy – Kansas City, MO

• 4/25/2019 – BevCap’s Best Practices Workshop – Orlando, FL

• 4/26/2019 – Society of Professional Benefit Administrators Annual Conference – Washington, D.C.

• 5/2/2019 – MassAHU Benefest 2019 Conference – Westborough, MA

• 5/14/2019 – Cypress Unversity – Las Vegas, NV

• 5/30/2019 – Contrarian Captive – Austin, TX

• 6/11/2019 – Leavitt Conference – Big Sky, MT

• 7/16/2019 – HCAA TPA Summit – Dallas, TX

• 7/31/2019 – 2019 MVP Academy – Wellesley, MA

• 8/20/2019 – Pritchard & Jerden Employee Benefits Forum – Brookhaven, GA

• 9/30/2019 – SIIA National Educational Conference & Expo – San Francisco, CA

• 10/27/2019 – 2019 Annual NASP Conference – Washington DC

 

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Get to Know Our Employees of the Quarter:
Katie Delaney & Corrie Cripps

Congratulations to Katie Delaney & Corrie Cripps, The Phia Group’s Q3 2019 Employee of the Quarter!

Katie and Corrie have both been dedicated employees at The Phia Group for many years, and we are so fortunate to have them on our team. With Corrie being a Consultant, II and PGC Internal Process Auditor, and Katie being a Senior Training & Development Specialist, it is clear that they are both key players in the success we have at The Phia Group.

 

Congratulations Katie & Corrie, and thank you for your many current and future contributions.

 

 


Phia News

PACE® Certification is Almost Here!

The PACE Certification program will educate you using 3 distinct chapters of information:

Chapter One
Explore the ins and outs of self-funding while learning about its risks and rewards. This chapter will transform any individual into a self-funding pro.

Chapter Two
Take a deeper dive into the laws that apply to self-funded plans. We cover it all, from federal preemption to adverse benefit determinations and appeals.

Chapter Three
Explain what PACE is, what PACE does, and how it's obtained, implemented, and utilized.

The PACE Certification program is free of charge and will create immense value for your organization. By going through the Certification program, you, or a select person, or team, within your organization, can become PACE Certified. Once PACE Certified, the Program participant(s) will become highly educated PACE business owners and will serve to assist your organization in growing your PACE business, enhancing your PACE revenue, and assuring your appeals processes are the most compliant and best in the industry. Those who complete the Certification will also receive a PACE Certification Fact Sheet, providing an easy to understand summary of the content and best practices covered, which will allow you to maximize the lessons learned within your business.

Additionally, the PACE Certification program will provide education on self-funding in general, claims and appeals regulatory education, and overall best practices surrounding fiduciary duties, claims, and appeals.

The PACE Certification program will be released to all those interested starting August 1, 2019.

Please see the PACE Certification flyer, as well as this video for more information.

Please contact Tim Callender (tcallender@phiagroup.com), or Garrick Hunt (ghunt@phiagroup.com), for more information.

 

Śmigus-dyngus at Phia

On April 22nd (Easter Monday), The Phia Family celebrated a traditional Polish holiday called Śmigus-dyngus, with a Polish lunch graciously provided by our CEO, Adam Russo. Normally, the holiday includes a big water fight, but we decided not to go down that route. We did however have some delicious Polish meats and pastries, accompanied by a delicious Polish fruit beverage.

 

 

Opening Day BBQ

It has become tradition at The Phia Group to celebrate Opening Day! We invite all Phia employees to dress up in their favorite sports team gear. As you can see, we have a heavy variety of team spirit here at The Phia Group. Some New York Yankees fans, Cleveland Indians fans, and of course, Boston Red Sox fans. Towards the end of the day, the Phia Family comes together outside of our office to celebrate with hotdogs, cold beverages, and great conversations.

 

 

Betting on the Bruins!

The Phia Family suited up in their finest Bruins gear (with the exception of a few Phians) to show their pride and support as the Bruins entered the Stanley Cup Final, in an attempt to win their 7th Stanley Cup. Although the Bruins fell a bit short, they still made it to the final round, which is a victory in itself.

 


 

Job Opportunities:

• Marketing & Accounts Coordinator

• Health Benefit Plan Drafter

• Health Benefits - Case Investigator I

• Attorney 1

• IT Intern

• PACE Intake Client Coordinator

• Health Benefit Plan Attorney I

• Client Intake Specialist

• Senior Claims Specialist II, Provider Relations

 

See the latest job opportunities, here: https://www.phiagroup.com/About-Us/Careers

 

Promotions

• Francesca Russo has been promoted from Claim Recovery Specialist III to Claim Recovery Specialist IV

• Colleen Ahern has been promoted from Claim Recovery Specialist III to Sr. Claim Recovery Specialist

• Nicole Russo has been promoted from Case Investigator to Claim Recovery Specialist III

• Brittany Grueter has been promoted from Case Investigator to Claim Recovery Specialist III
 

New Hires

• Nasim Hassan was hired as an Intake Specialist

• David Ostrowsky was hired as a Plan Drafter

• Denise Swienc was hired as a Customer Care Representative

• Darlene Zarella was hired as a Claim Specialist II

• Kelly Gaunya was hired as an Subrogation Recovery Intern

• Erin Daley was hired as a Customer Care Representative

• Kaitlyn Lucier was hired as a Customer Care Representative

• Caelin McDonald was hired as an HR Intern

• Matthew Williams was hired as a Sr. Subrogation Attorney

• Jackie Andrews was hired as a Provider Relations Concierge

• Dylan Fry was hired as a Marketing & CAM Intern

• Bryan Dunton was hired as a Plan Drafter

• Krista Belanger was hired as a Plan Drafter

• Brenna Jackson was hired as a Legal Assistant

• Donna Harman was hired as a Overpayments Assistant

• Kevin Brady was hired as an Attorney I



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info@phiagroup.com
781-535-5600

The Stacks - 3rd Quarter 2019

On July 2, 2019

The Lien, Mean, Subrogation Machine

By: Maribel Echeverry McLaughlin, Esq

When you think of personal injury attorneys, you may imagine men in trench coats with cheesy tag lines with inflated promises, and commercials with ambulances blaring in the background.  Fortunately, I do not like trench coats, my tag lines are only sometimes cheesy, and ambulances terrify me.  

While attending law school, I worked for an attorney who became a state legislator, which meant I was forced to learn the ins and outs of running a practice in a very short period of time.  That experience ultimately left a bad taste in my mouth for opening my own firm.  Eventually, after graduating law school, I started my career as a junior associate in the personal injury firm down the street and became the partner’s main resource for research… and coffee.  

Working there opened my eyes to new experiences, such as the opportunity to practice law with a team of partners and senior associates.  We met once a week and strategized on how to win the most amount of money for our clients and, obviously, for the firm.  Sometimes those two goals conflicted with each other and we would work to find a resolution that would make sense for all parties involved.  

Interestingly enough, that typically meant negotiating with healthcare providers and health insurance plans.  In my tenure with this firm, I may have come across at least five (5) liens from private self-funded benefit plans.  After much negotiation and push back from the plans, each of them were resolved.  But it was not until I left that world that I realized how little personal injury attorneys actually know about the Employment Retirement Income Security Act (ERISA), self-funded health plans, and how they function in our world.  

Overview of the Law:
In 1990, the United State Supreme Court ruled in FMC Corp. v. Holliday,1 that state law will not prevent a private self-funded plan governed under ERISA from obtaining reimbursement. Additionally, the Court ruled that any state law that is contrary to ERISA would be preempted if the Plan’s language so provides or there is a clear contradiction to the federal law.

For years, this law went unchallenged until 2006, when Mr. and Mrs. Sereboff were involved in a motor vehicle accident, and the Mid Atlantic Medical Services Employee Health Plan paid related claims in the amount of $74,869.37.  

The Sereboff’s eventually settled their personal injury claim for $750,000.00 and did not reimburse the self-funded Plan.  The Plan eventually filed suit in the U.S. District Court for the District of Maryland, claiming a right to collect from the Sereboffs under § 502(a)(3) of ERISA.  

The Court ruled in Sereboff v. Mid Atlantic Medical Services2 that the federal courts have subject matter jurisdiction over actions where an ERISA-covered Plan seeks equitable relief.  The Court further ruled that if an ERISA-covered Plan has paid medical benefits arising from an act or omission of a third-party for which a plan participant obtains a settled or jury award, the Plan has a right to right to enforce the terms of the Plan Document pursuant to ERISA 502(a)(3), for equitable relief.

Shortly after, the Supreme Court held again in US Airways, Inc. v. McCutchen3, that the terms of an ERISA-covered Plan would be enforced as written, despite any contrary state law or equitable principle.  

This was a landmark decision as it clarified that the “common fund” and “made-whole” doctrines could be disclaimed by an ERISA Plan in their Plan Document language.  Whether adopted by state statute or relying on common law, neither of these doctrines can be used to defeat the Plan’s right of full reimbursement as long as there is clear language in the Plan Document disclaiming the application of these principles.

Most recently, the Court decided in Montanile v. Board of Trustees of Nat. Elevator Industry Health Benefit Plan4, when a participant in an ERISA plan dissipates a third-party settlement on non-traceable items, the plan fiduciary may not bring suit to attach the participant's separate assets5.  In other words, the Plan is only entitled to “their” money, but if it cannot be traced in an asset that was paid for with that money, then the Plan cannot sue for the member’s general assets.  

Decisions to Settle and Negotiate Liens by Personal Injury Attorneys:
While working for the trench coats, I realized that large insurance carriers, such as Blue Cross, United, etc., were willing to settle without much work and negotiation.  At that time, it was easier to settle those liens than trying to work out a balance with a provider and proved to be more financially sound for the member.  

After negotiating with many private self-funded Plans, I realized they were, and still are, the most difficult to negotiate.  Attorneys will advocate zealously for their clients, whether they are victims of a horrific car accident case, or for the Plans themselves.

I received a letter not too long ago, from a lien resolution company in California, that was fifteen pages long, filled with arguments for the Plan to reduce their lien. Interestingly enough, after doing a quick internet search, it happens to be a string of arguments that many plaintiff attorneys are making to work through the private self-funded Plans governed by ERISA.  

Some of these arguments are easy to argue away, such as the common fund and made-whole arguments, especially if they are disclaimed in the Plan’s language.  

The attorney from the lien resolution company was representing a member and their attorney, for reimbursement and subrogation claims.  He sent me exactly what the member’s attorney had requested for a reimbursement, and interestingly enough, the Plan had previously refused to reduce their interest.  He made many arguments throughout those 15 pages and frankly only two stuck out to me.

He titled one “Deficiencies in the Plan Documentation”6; in which he alleged that the Plan administrator must properly disclose any reimbursement provision to Plan beneficiaries in the Plan document.

He opined that the Ninth Circuit, 29 C.F.R. 2520.102-2(b) requires that “(1) the description of summary of [a] restrictive provision must be placed in close conjunction with the description or summary of benefits, or (2) the pages on which the restrictive provision is described must be noted adjacent to the benefit description.”7 

The Court ruled that a reasonable Plan participant should not have to read every provision of a Plan’s documentation in order to ensure they have read every restrictive provision.8  The Court invalidated an inconspicuously-placed provision where the limitations for third party liability and out-of-pocket maximums were separated from the Plan’s description of benefits by multiple unrelated plan provisions, without cross-references or indexing.  

Our client’s Plan had the reimbursement provision entirely isolated from other provisions of the Plan’s documentation, and as such, would be invalidated by the Ninth Circuit.

The second argument cited was titled “Out of Pocket Maximum.”9 Here, he alleged that the Plan Document provided that individual beneficiaries would not pay more than a specific amount toward medical expenses.  He explained that the “Out of Pocket Maximum” should be a defined term, but in this document, it was not.  He also pointed out that the Plan Document does not define the terms “reimbursement”, “subrogation”, “lien” or other terms relevant to the third-party provision.10

As a former plaintiff’s attorney, I can understand and appreciate the zealous advocacy that this attorney was providing to his client.  It is difficult to balance all the interests especially when the common understanding is that the insurance companies have an abundance of money and that this lien interest would not break the bank.  

In reality, after explaining the concept of self-funding and paying claims out of the pool of money for all members that pay their premiums, attorneys tend to appreciate the advocacy we provide on behalf of these Plans.  These are not big bad insurance companies, as many people perceive; these are usually smaller companies, with the hope of keeping the risk low, and claims paid.  The opportunity for reimbursement for third party claims keeps the premiums low for the members, a concept that eventually attorneys or members understand completely.  

After reviewing these arguments with other attorneys in our office, we agreed that we should amend our major medical template to include these definitions and add references to certain places in our Flagship Plan document, in order to avoid these sorts of arguments from other attorneys in the future.

Specialists in plan document drafting and subrogation attorneys will be able to review your plan document to ensure we address all of the arguments to meet the needs of self-funded groups and their members.
________________________________________

  1FMC Corp. v. Holliday, 498 U.S. 52 (1990)
  2Sereboff v. Mid Atlantic Medical Services, 547 U.S. 356 (2006)
  3US Airways, Inc. v. McCutchen, et al., 133 S.Ct. 1537 (2013)
  4Montanile v. Board of Trustees of Nat. Elevator Industry Health Benefit Plan, 135 S.Ct. 651 (2016),
  5Id. at 655
  6John J. Rice, Esq, LTR #3 to Phia - Clariza (2018)
  7Spinedex Physical Therapy USA Inc. v. United Healthcare of Arizona, Inc. (9th Cir. 2014) 770 F.3d 1282, 1295
  8Id. at 1296.
  9John J. Rice, Esq, LTR #3 to Phia - Clariza (2018)
  10Id.

__________________________________________________________________________________________

Transparency – A Clear and Almost-Present Danger?

By: Ron E. Peck, Esq

Transparency in healthcare, and pricing of care, has been a hot topic – especially for those in our industry – for quite some time.  That flame has been fed recently by an increase in regulatory and legislative attention.  About one year ago, a bipartisan group of Senators unveiled their intention to launch a healthcare price and quality information transparency initiative, and the feedback has been all over the map.

I recently published a blog post regarding failed attempts at transparency in retail.  The two examples I shared therein I’ve also described below.  The response I received was passionate – from support, to opposition; it seems as if everyone feels “something” when it comes to “transparency.”  Before you read any further, let me state clearly and unequivocally that I am a staunch supporter of transparency – as a concept, as well as a tool to be used in our never-ending quest to minimize costs while maximizing benefits in health coverage and care.  Like so many other useful tools, however, transparency in overabundance or without other key ingredients will not only fail to move the needle (as it relates to the cost of health care) but may result in an increase in spending.

To get you up to speed, the examples of transparency (gone wrong) that I love to share are as follows –

Exhibit A: JC Penny’s.  Recall in 2011, when JC Penny’s made what most experts have deemed a catastrophic, strategic mistake, regarding its pricing strategy.  What horrific miscalculation did the retail giant make?  It replaced “sales” (a/k/a “discount”) and “coupons” with everyday low prices.  JC Penny’s told consumers: “Hey!  We aren’t going to bamboozle you by inflating prices, and then throwing arbitrary discounts at you.  Instead, we’ll offer you fair prices without any games.”  This was one example where transparency failed miserably.

Exhibit B: Payless.  If you want to buy some sneakers from Payless, you’d better do it soon.  Payless ShoeSource, Inc. is closing for good.  I’ve never shopped at Payless myself, but they hold a special place in my heart by virtue of something they did in November of 2018.  Yes indeed; it was only a few months ago that they supported my theory that transparency without quality awareness is not only useless, but potentially dangerous.  Payless opened a fake luxury store, dubbed “Palessi.”  At this “boutique,” they displayed shoes (for which they normally charge $20 at their Payless stores), with price tags that ranged up to $600+ (a 1,800% markup).  Shoppers saw the higher prices and assumed that – if it costs more, it must be better.

Another example of transparency that not only fails to reduce spending, but increases it, is also tethered to healthcare.  Unlike many other expenses about which we industry members are dealing, (expenses for which the lion’s share of the cost is borne by the benefit plan and as such, the patient has no “skin in the game”), one example of healthcare costs for which plan participants are fully responsible to pay is over the counter pain medication.  Enter any retail pharmacy and you’ll see brand name medication, and identical store brand drugs, sharing shelf space.  The store brand is clearly marked with a lower price than the brand name drug – who’s price is also clearly labeled.  Additionally, both medications list the ingredients on the package; identical ingredients and percentages.  This is the ultimate cross-roads between healthcare, patient skin in the game, and transparency.  So, of course people buy the store brand drug – it’s the same drug, costs less, and the patient is financially responsible to pay the price.  Transparency works, right?  Wrong!  People overwhelmingly purchase the branded drug.

I’ve said it before, and I’ll say it again – people want the most expensive option.  People don’t want to pay for the most expensive option, but they want to have the most expensive option.

Look no further than the credit crisis bankrupting so many Americans.  Credit cards made it so easy for people to buy more than they could afford, because they made it “feel” like it was someone else’s money.

Sound familiar?

People inherently want the most expensive option, because they are convinced price is an indicator of quality.  Additionally, luxury purchases are a status symbol.

So we (human beings) want the best.  We assume the most expensive option must be the best option – ever hear someone say, “you get what you pay for?”  Additionally, we want other people to think we have the best (a/k/a the most expensive) stuff as well.  The only roadblock is that we don’t always have enough money with which to buy the best (most expensive) stuff.  Drat.

But, when someone gives me a magical “card” and that “card” grants me access to deeper pockets than my own, I can now use that “card” to buy the best (a/k/a most expensive) stuff.  The fact that I will tomorrow be asked to pay for that “stuff” later (either in the form of credit card payments … or … [assuming my metaphor didn’t go over your head] insurance premiums) won’t stop me from running up an unaffordable bill today.

Transparency did nothing to stop people from getting themselves into credit card debt.  Transparency will do nothing to curb people’s health care spending, and I actually foresee it making things worse.  Consider the proposals to have drug prices on TV advertisements.  I’m watching the Patriots beat another opponent, when a commercial for Viagra pops up; (pun intended).  The commercial ends by telling me the cost of the drug is $400.  Next, a commercial for Cialis appears, and tells me that drug costs $600.  Well – don’t I and my spouse deserve the best?  Cialis it is!

I’d like to say that I am the first to spot these phenomena, but I’m not.  In 2016, the Journal of the American Medical Association published a study1 that supports my assertion that transparency on its own doesn’t lead to savings.  In this study, two employers offered web-based tools to their employee plan participants, providing them with “transparent” healthcare prices.  It empowered these participants to compare prices and “shop around” for their care.  The result?  The tools were rarely accessed, despite the introduction of high deductibles.  In fact, as a side note, the high deductibles caused more participants to seek more costly care, in an effort to burn through the out of pocket maximum as quickly as possible.  Additionally, for the reasons already discussed earlier, researchers discovered that the participants with access to pricing ended up picking the more expensive options, more often than participants without access to pricing.

This report supports my theory above that patients always apply the type of rational behavior upon which traditional economic theory is based, especially when they are shopping for health care.  Rational behavior and economics would anticipate that a consumer will buy a less costly option unless the more expensive option includes additional features worth the added expense to the consumer.  That attitude, however, fails to take into account people’s need to “be seen” as affluent (and flaunt non-existent wealth), as well as their unfounded belief that if something costs more it must be better, and is worth the added expense.  Consider, for instance, the blind taste tests where a person is given two glasses of wine, and they are told one is a $100 glass of wine, and the other is a $10 glass of wine.  Without fail, the drinker claims the more expensive wine is better tasting – even though (you guessed it) the wine in the glasses is the same wine!

Looking at the impact of transparency on a broader scale, Professor David De Cremer of Cambridge University’s Judge Business School, published a fascinating article about transparency, and when it backfires.2  In it, he lists four negative side effects of transparency.  He discusses how it: creates a culture of blame (people become hyper-focused on what they are seeing and reacting to it, rather than identify bigger picture issues, causes for those issues, and solutions); increases distrust (those whose work is constantly under the microscope feel micro-managed and unable to take risks); increases cheating (those who are constantly being watched begin to look for, and take advantage of, any opportunity to game the system when the albeit rare opportunity arises); and sparks resistance (people refuse to do any work that will be hyper-examined, protesting the lack of faith).

Finally, let’s not lose sight of the fact that not everyone agrees on what transparency in healthcare even is.  Consider the Federation of American Hospitals which wrote to Congress that: “ …the healthcare price transparency initiative should focus on sharing out-of-pocket costs. Patients undergoing the same procedure could end up paying different amounts based on their health plan. Therefore, out-of-pocket cost information is more valuable to consumers … effective price transparency should involve the release of information that is clear, accessible, and actionable so that consumers easily can determine the cost of their premiums, deductibles, copayments, and non-covered services (out-of-pocket costs), prior to purchasing health insurance coverage as well as receiving medical services.”  Yikes.

Dr. Niran S. Al-Agba, MD posted on the MedPage Today Professional “KevinMD Blog”3 – “Comprehensive transparency is only relevant if packaged in a reliable comparative context.  Information regarding cost, value, and effectiveness should be readily accessible to patients enabling them to make meaningful comparisons across providers and specialists. However, choices must be incentivized properly, so they are not only empowered but also motivated to use the information to make informed choices.”  I totally agree.  Unless and until reliable quality measurements are included in the transparency discussion, and that information is delivered in such a way that the consumer will understand and appreciate that price has no relationship with quality, I fear “price transparency” on its own is not only a step too short, but potentially a step backwards, in Palessi boots.
____________________________________________

 

1https://jamanetwork.com/journals/jama/fullarticle/2518264
2https://hbr.org/2016/07/when-transparency-backfires-and-how-to-prevent-it
3https://www.kevinmd.com/blog/2017/03/problem-price-transparency.html

__________________________________________________________________________________________

Seasons of Change: How to Successfully Implement Evolving Healthcare Trends

By: Jennifer M. McCormick, Esq.

Have you ever wondered whether you paid more for your flight than the person next to you on the airplane? What about whether you could be doing more (or less) to save money and time?  I’m confident we all frequently ponder what we can do differently to save.

Whether big or small savings, we’re constantly looking for ways save money in all areas of our life.  Dinner budgets, car insurance, clothes, general spending - you name it and surely, we have contemplated whether we can reduce that expense.  But we also try to balance cost against convenience, expecting to save money and time.  For example, we can click a couple of buttons on our phone and groceries appear at our doorstep two hours later, saving us both money and time.

Can we say the same for our self-funded plan documents? Regulatory changes and medical technologies are continually advancing.  Why aren’t we applying these new technologies, endeavoring to save money and time, to our self-funded plans? It’s probably because we don’t know how to get started.

Hopefully this discussion will help provide a framework to allow employers and plans to implement new medical technologies and other time and cost savers! We will break down some steps to help simplify implementation of new regulations and technologies.

Step 1: Ask Questions!

When approached about a new idea ask this question - what problem are you trying to solve?  Not only is it key to understand what problem the new idea, new regulation, or new technology would be solving, but it is imperative to first determine whether it is a problem that needs to be solved!

When it comes to savings, time is money too. As a result, the first part of an analysis should be ensuring that the full scope of the problem requiring resolution is realized.  What is ‘costing’ the most … time, money, or both?

After understanding the extent of the problem, review whether the idea would mitigate or eliminate the problem.  For example, assume Fictitious Company A has the proven and medically (and dentally) backed solution to effectively reduce the cost of elective cosmetic dental surgeries by 50% for a low monthly cost to the plan.  An employer might think that would be fantastic, but after reviewing a copy of the plan document and summary plan description realized that elective cosmetic dental surgeries are excluded.  In that example, even though real savings could exist, the solution does not solve a problem for the employer (i.e. with an exclusion the employer pays 0% for elective cosmetic dental surgeries).

Assume instead that the employer was hoping to remove the exclusion for elective cosmetic dental surgeries.  Employer wants to offer this benefit to participants of the self-funded plan it sponsors but wants to control costs.  The services offered by Fictitious Company A might be a perfect fit! Here, the idea solves a problem for the employer.

The next set of questions should aim to proactively troubleshoot barriers to implementation of the idea. How can hurdles be eliminated and what alternatives exist to address the concerns? Is there a way to take the hurdle and create an opportunity?

For example, many states are implementing paid family leave laws.  For employers, the problem that needs to be solved here is investigating what must be done to comply, how must it be done, and how can it be financed.  In addition to understanding what state regulations would apply, employers may wish to review their current plan materials.  Does the employer currently have a policy in place that addresses the regulations? If not, can you make updates to existing benefits? Would this be a good opportunity to investigate whether establishing a self-funded benefit might solve the problem, while offering employer convenience and cost savings?

Assuming the answer is yes, the next step would be to investigate any impediments.

Step 2: Investigate Impediments

It’s important to investigate impediments to an employer’s or plan’s ability to successfully implement a valuable idea.  This requires understanding what agreements should be in place, certain legal hurdles that could prevent taking further steps, and whether the claims systems would need changes to address the new technology or solution.

For example, assume a self-funded plan has many members seeking various chronic pain treatments.  A progressive employer, looking to offer an alternative to high cost treatments, investigates medical cannabis.  Coverage of this benefit would save the plan money. In this case, the employer is located in a state that has legalized medical cannabis. The employer decides to investigate modification of the plan design.  Upon investigation, the employer uncovers that the addition of this benefit would be problematic.  While legal at the state level, it is still considered a schedule I drug under federal law.  As a result, it may not be prescribed for medical use (See Section II ‘General Requirements’ of the Practitioner’s Manual from documentation issued by the United States Department of Justice, Drug Enforcement Agency, Office of Diversion Control for additional information). With this discovery, the employer decides that while coverage may be beneficial, medical cannabis is not a prudent addition to the plan terms.

Alternatively, let’s assume that instead of medical cannabis the benefit that the employer wanted to cover was Chronic Pain Treatment B, a brand-new cutting-edge medical technology.  Upon investigation, the employer identifies that there are no legal hurdles; however, it determines that this new medical technology is considered investigational and experimental.  Not only does the plan have a current exclusion for items considered investigational and experimental, but an applicable stop loss policy would not provide reimbursement for related claims.

Now, assume the same facts as above, except the medical technology in this instance is not considered investigational or experimental. The employer would seek to determine whether any executed agreements would impact implementation.  Would a new agreement need to be executed, would that agreement conflict with any existing agreements (i.e. stop loss policy, network agreement, PBM agreement, etc.)? Assuming no conflicts, the employer could implement the new solution or technology.

Step 3: Implementation

A solution free of impediments has been identified to solve a problem.  Does implementation of the solution require a plan update? If so, does the solution create a new benefit or reduce a current benefit? Will the solution be implemented mid-year via an amendment or at plan renewal? Will other documents need to be updated as well, like the Summary of Benefits and Coverage (SBC)? Are there concerns about the Affordable Care Act (ACA) or the Employee Retirement Income Security Act (ERISA) timelines or rules?

For example, assume an employer wants to implement New Benefit C. This new (FDA-approved) technology will save patients and the plan both time and money. The new technology, however, is so new that claims systems have not been updated to accommodate this type of service.  New Benefit C is offered in collaboration with a common medical treatment, but it is unclear how coding for New Benefit C would be handled. In this example, the administrator would need to be aware of how this would be identified to ensure correct processing.  Simple adoption (or modification or removal) of plan language may not be enough; a review of how (or whether) a claim may be processed is also necessary.

Instead, assume an employer wants to offer more expansive leave of absence provisions for its employees.  The employer modifies the employee handbook and has a staff meeting to address the new provisions.  The employer, however, fails to address this policy change in the relevant plan materials, or with the stop loss carrier.  As a result, implementation of the benefit may inadvertently create a coverage gap among stop loss coverage, the plan document, and the employee handbook.  When implementing a new benefit, it is imperative to analyze the impact on other entities.

Step 4: Engagement

Engagement is going to help make the idea or solution successful.  At this point, a problem was identified, a solution was envisioned, and implementation was completed.  How can the employer or plan ensure the idea or solution is being utilized, since utilization is the key to success (i.e. savings)?

For example, assume an employer opted to add a new plan option to the current plan design at renewal.  This new plan option includes direct primary care but will require participants to affirmatively elect that option.  This plan option should not only be enticing for participants, but it has the opportunity to save the plan money.  Since the employer’s participants are unaware of direct primary care the employer elects to hold an educational meeting.  This session educates participants about direct primary care and what new and exciting benefits are be available under this new plan option.

In addition to educational meetings to inform participants of new benefits, employers can encourage engagement by financially incentivizing programs. For example, employers can reduce copays to encourage utilization of the new idea or solution.

Employers can also seek ways to encourage engagement outside of the plan design.  For example, why not incentivize employees to ask questions about health benefit options available to them?  An employer could create a program offering a reward if an employee voluntarily opted to chat with human resources about a planned treatment.

A combination of education, incentives (or penalties), and employee rewards can help employers ensure engagement in programs that are designed to protect participants and save the plan money.

Don’t let new advances pass by!  Keep the plan in check and on trend with the latest and greatest healthcare innovations without sacrificing compliance. Follow this simple framework to ensure new ideas are successfully implemented so the plan, employer and members stay happy - and realize savings!

 

The Phia Group's 2nd Quarter 2019 Newsletter

On April 22, 2019


Phone: 781-535-5600 | www.phiagroup.com

 


The Book of Russo:
From the Desk of the CEO

We are in full spring mode here at The Phia Group, enjoying warmer weather and record breaking growth. My pool is open, the Indians are playing (more like winning) baseball, and we are already seeing an uptick in renewals on behalf of our clients. While the self-funded space has more energy than ever, we are also seeing some situations where employers and brokers aren’t fully aware of what they are getting themselves into. Yes, you can be innovative and save money, but you must also understand that you are now a fiduciary, you must take on added exposure and risk. There are many moving pieces in the self-funded space, so the plug and play approach won’t always work. In fact, you will get the best results by not plugging and playing anything. This is where we come in, from setting up your plan design to handling your appeal issues, Phia is here to ensure you have a positive self-funding experience. I hope you enjoy the great newsletter we have put together for you. Happy reading!


Service Focus of the Quarter: Unwrapped and CNS
Phia Group Case Study - Frightening ASA Provisions
Phia Fit to Print
From the Blogosphere
Webinars
Podcasts
The Phia Group’s 2019 Charity
The Stacks
Phia’s Speaking Events
Employee of the Quarter
Phia News

 

Service Focus of the Quarter: Unwrapped and CNS

We have all witnessed instances of abusive provider billing. When imposed upon a self-funded health plan, the effects seem most disastrous. To combat this, some groups have migrated to a no-network, full reference-based pricing model. While that is ideal for some groups, it is still a small minority of plan sponsors who are willing or able to bear the risks associated with a full reference-based pricing program.

A more traditional way of combating high claims is one-off claim negotiations. The Phia Group calls this our Claim Negotiation & Signoff service (or CNS). Through this service, The Phia Group puts its legal team and expert negotiators to work, to combine legal expertise with objective cost data to obtain case-by-case negotiations with medical billers. A comprehensive set of data helps determine market-based prices, to put payors on a level playing field with their members’ medical providers, and secure written payment agreements that avoid balance-billing.

The Phia Group proudly boasts a 51% average discount off billed charges on claims within the CNS service. Unlike CNS, however, Phia Unwrapped is anything but traditional. Wrap, extender, and other leased networks offer small discounts and audit restrictions, affording providers nearly unlimited rights. With Phia Unwrapped, The Phia Group replaces wrap network access and modifies non-network payment methodologies, securing payable amounts that are unbeatably low. Phia Unwrapped places no minimum threshold on claims to be repriced or potential balance billing to be negotiated, and The Phia Group attempts to secure sign-off, ensuring providers will accept the plan’s payment as payment in full.

Out-of-network claims run through The Phia Group's Unwrapped program yielded a whopping average savings of 74% off billed charges (three times the average wrap discount in 2018). On average, The Phia Group sees roughly 2% of claims result in some form of balance-billing; these results are similar throughout many different plan types and geographies, proving that this program and these results can be applied nationwide.

Contact our Vice President of Sales and Marketing, attorney Tim Callender, to learn more about CNS or Phia Unwrapped. Tim can be reached by phone at 781-535-5631 or by email at TCallender@phiagroup.com.

 

Phia Case Study: Frightening ASA Provisions

The broker of a self-funded benefit plan was presented with an Administrative Services Agreement (or ASA), by which the prospective TPA would administer claims for the health plan. The broker presented our consulting division with the Administrative Services Agreement to review, as a matter of ordinary diligence. This review was focused on a holistic approach, rather than any particular provisions that were previously identified as troublesome.

Upon reading the ASA, The Phia Group’s reviewer noticed a provision relating to the network, which provided that the plan would be required to pay certain types of claims despite issues with medical necessity or experimental status. This ASA essentially rendered those important Plan exclusions unusable, which, needless to say, is a problem.

Among other issues to address within the ASA, The Phia Group placed a great deal of emphasis on that provision when providing the client with the review, and the broker was grateful that this matter was brought to light. This is especially important from a stop-loss perspective; it’s tough to know how exactly a given carrier will treat a particular situation without a discussion, and this language within the ASA couldn’t be discussed until it was identified.

With the information provided by The Phia Group, the broker and group were able to discuss the matter with the TPA and reach a resolution favorable to all parties involved – and the plan no longer had to worry that its ASA required it to pay claims that stop-loss would almost certainly deny!

 


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Fiduciary Burden of the Quarter: Ensuring Proper Application of OOP Limits!

The Department of Labor has explained that amounts that must be applied to an individual’s out-of-pocket maximum do not (but may, at the plan’s option) include “premiums, balance billing amounts for non-network providers, or spending for non-covered services.” A claim subject to reference-based pricing, as opposed to one subject to a contract with a provider, necessarily entails an out-of-network claim. Thus, according to the DOL’s original interpretation, balance-billed amounts resulting from non-network reference-based pricing are not included in the individual’s out-of-pocket cost limitations.

Subsequently, however, the DOL got wind of this whole reference-based pricing phenomenon, and altered its stance a bit. According to the regulators:

“…a plan that utilizes a reference-based pricing design (or similar network design) may treat those providers that accept the reference-based price as the only in-network providers and not count an individual’s out-of-pocket expenses for services rendered by other providers towards the MOOP limit only if the plan is using a reasonable method to ensure adequate access to quality providers at the reference price.”

In other words, it’s still the case that a patient’s OOP does not include balance-billed amounts – but that’s only if the plan “is using a reasonable method to ensure adequate access to quality providers at the reference price.” Our interpretation of that has been that reference-based pricing is still alive and well according to the DOL – but a given RBP plan must count balance-billed amounts toward patient OOP unless the plan provides patients options to avoid balance-billing. The DOL has not elaborated on what those options may be, but a reasonable interpretation is that contracts of any kind would work. Some plans choose to use a full PPO and only use RBP for out-of-network claims; other plans use a narrow network; others choose to sign contracts with certain choice facilities to provide their members with safe options; others still opt to sign no contracts whatsoever, but are sure to settle claims on the back-end to avoid balance-billing.

Whatever option you choose for your RBP plan, make sure you’re following the regulations! One important fiduciary duty of a Plan Administrator is to accurately calculate member OOP – and when it comes to reference-based pricing, that can get tricky.

 

Success Story of the Quarter: Overpayment Recovery

The Phia Group’s overpayment department was presented with a file whereby the TPA identified a claim that was overpaid to a medical provider; the overpayment reason was that Medicare was primary on the claims, but the TPA placed the self-funded health plan as primary in error. The plan had paid $76,000. The TPA knew that the plan would need to pay something as secondary, but certainly not its entire allowable. Further, the TPA had concerns that the group and its broker would hold the TPA responsible if the money couldn’t be recovered.

The Phia Group’s overpayment experts reached out to the provider, and initially were given the cold shoulder. After continuous communication with the provider and making sure to stay on the hospital’s radar, eventually the claim was escalated to the hospital’s CFO. After a series of lengthy discussions, the hospital’s CFO finally agreed to resubmit the claims to Medicare, but only agreed to refund the Plan the portion of the claim that was not in fact payable by Medicare, effectively treating the plan as secondary up to the full, billed charges.

At that point, one of The Phia Group’s attorneys contacted the hospital’s CFO, in an attempt to explain that even though the self-funded health plan pays secondary to Medicare, the health plan’s allowable amount is defined within the Plan Document, and is not the full billed charges. After The Phia Group’s overpayment team went back and forth for many weeks and explained the plan’s language numerous times the CFO seemed to understand.

Ultimately, it was revealed that Medicare paid the claims in question at the rate of $58,000. Because the plan’s allowable was the original $76,000, the plan paid the difference of $18,000 as secondary, but was refunded the $58,000 that Medicare paid as primary.

The moral of this story? If you find that money has been overpaid, The Phia Group can help you recover it! Contact our Vice President of Sales and Marketing, attorney Tim Callender, to learn more about The Phia Group’s overpayment recovery services. Tim can be reached by phone at 781-535-5631 or by email at TCallender@phiagroup.com.
 

 


 

Phia Fit to Print:

• Free Market Healthcare Solutions – You Have the Right to Know the Price – March 10, 2019

• Self-Insurers Publishing Corp. – The Self-Funded Case-Back To Basics – March 8, 2019

• BenefitsPro – How close are we to a federal paid family leave law? – March 6, 2019

• Self-Insurers Publishing Corp. – The Profit Motive-A Necessary Evil? – February 5, 2019

• Self-Insurers Publishing Corp. – A Texas Federal Judge Declares The Affordable Care Act Unconstitutional: What Next? – January 16, 2019

• Money Inc. – Texas v. United States: The Events that Followed and the Impact of the Government Shutdown – January 14, 2019

• Managed Healthcare Executive – Top 4 Challenges Healthcare Faces in 2019 – January 11, 2019



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From the Blogosphere:

Foreign Drugs: Savings Worth Traveling For. A roadtrip that might be worth taking.

To RBP, or Not to RBP: That is (one) of the Question(s). Reference-based pricing is one of the most mysterious self-funding structures out there.

Hey, Watch Your Language! Clear language describes what the plan will pay in a comprehensible manner.

New Action on Drug Pricing: Medicare-Like Rates? From ending pharmacy gag rules to outlawing the use of co-pay coupons.

Blocking the Birth Control Rule. Coverage of contraceptives for women and the availability of a religious or moral exemption (or an accommodation) has been hotly debated recently.

 

To stay up to date on other industry news, please visit our blog.



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Webinars

Click HERE to Register!

• On March 14, 2019, The Phia Group presented, “Transparency: A Building Block of Self-funding,” where we discussed some emerging and ongoing transparency issues, measures being taken to try to resolve them, and methods you can use to get the data you need in order to lower costs.

• On February 14, 2019, The Phia Group presented, “What We Love About Self-Funding in 2019,” where we discussed what makes self-funding such a great option for so many employers and employees, as well as the incredibly cool new innovations rolling out in 2019.

• On January 16, 2019, The Phia Group presented, “The Affordable Care Act in 2019: A Look Ahead,” where we discussed many legal and political battles that threaten the ACA's existence.

Be sure to check out all of our past webinars!



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Podcasts:Featuring Video Podcasts!

• On March 29, 2019, The Phia Group presented, “Breaking News - Federal Judge Blocks Expansion of AHPs,” where Adam and Brady discuss the Department of Labor’s new rules that expanded the sale of association health plans (“AHPs”) violate existing law.

• On March 26, 2019, The Phia Group presented, “Employee Takeover: Self-Funded Health Plans from the Member's POV,” where Phia’s Marketing & Accounts Manager, Matthew Painten, and Compliance & Regulatory Affairs Consultant, Philip Qualo, dissect Phia’s very own Self-funded health plan.

• On February 28, 2019, The Phia Group presented, “Bigger in Texas,” where Ron and Brady discuss Brady’s recent trip to Austin and presentation at the Texas Association of Benefit Administrators.

• On February 15, 2019, The Phia Group presented, “Hail to the Chief!,” where our hosts, Brady and Ron, dissect the President’s State of the Union Address.

• On February 5, 2019, The Phia Group presented, “Hospital Transparency!,” where out hosts, Ron and Brady discuss the new legal compliance and regulatory affairs team (“LCARA”) with team member Philip Qualo, and specifically address recent efforts to promote hospital transparency.

• On January 25, 2019, The Phia Group presented “Touchdown!,” how providers – like plan sponsors – are concerned with the state of things and want to identify what’s wrong, what’s right, and how we can collaborate on a new approach that works for us all, as members of a single industry – healthcare.

• On January 10, 2019, The Phia Group presented “Obamacare is Still the Law, Right?,” where Ron and Brady dissect the Texas decision that challenges the legality of the ACA.

• On January 2, 2019, The Phia Group presented “Leather Patches & Pipes,” where our host, Ron Peck sits down with Andrew Silverio and Jon Jablon to discuss the forthcoming master’s degree program in plan development they will be teaching.

Be sure to check out all of our latest podcasts!

 

Face of Phia

• On February 19, 2019, The Phia Group presented, “Taking Account with Lisa T!,” where our hosts sit down with The Phia Group’s Senior Controller, Lisa Tangney.

• On February 8, 2019, The Phia Group presented, “It’s Tomasz Time!,” where our hosts sit down with The Phia Group’s Senior Claim & Case Support Analyst, Tomasz Olszewski.

• On January 30, 2019, The Phia Group presented, “Ashley Turco… International Agent of Security!,” where our hosts sit down with The Phia Group’s Director of Compliance, Ashley Turco.

• On January 17, 2019, The Phia Group presented, “Tech Talk with Hemant,” where our hosts sit down with The Phia Group’s Vice President of Technology, Hemant Dua.

• On January 14, 2019, The Phia Group presented, “Setting the Pace with Tori: Help me Tori!,” where our hosts sit down with a member of The Phia Group’s Client Implementation Coordinator, Tori Pace.

• On January 7, 2019, The Phia Group presented, “Dishing with Delaney,” where our hosts sit down with The Phia Group’s Senior Training & Development Specialist, Katie Delaney.

 

 



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The Phia Group’s 2019 Charity

At The Phia Group, we value our community and everyone in it. As we grow and shape our company, we hope to do the same for the people around us.

The Phia Group's 2019 charity is the Boys & Girls Club of Brockton.

 

The mission of The Boys & Girls Club is to nurture strong minds, healthy bodies, and community spirit through youth-driven quality programming in a safe and fun environment.

The Boys & Girls Club of Brockton (BGCB) was founded in 1990 to create a positive place for the youth of Brockton, Massachusetts. It immediately met a need in the community; in the first year alone, 500 youths, ages 8-18, signed up as club members. In the 25 years since, the club has expanded its scope exponentially by offering a mix of Boys & Girls Clubs of America (BGCA) nationally developed programs and activities unique to this club.

Since their founding, more than 20,000 Brockton youths have been welcomed through their doors. Currently, they serve more than 1,000 boys and girls ages 5-18 annually through the academic year and summertime programming.

 

A Special Delivery from the Phia Family

 

The Phia Family loves to show their Patriots Pride! In anticipation of the Super Bowl, we channeled our excitement to raise over 2,000 hygiene items and $1,400 for the Boys & Girls Club of Brockton! As a thank you to the kind, thoughtful, giving members of the Phia Family, we decided to reward everyone at the office with a late opening the day after the Super Bowl.

 

 

Youth of the Year

 

Our favorite time of the year has arrived and we get the opportunity to choose our Youth of the Year. A member of the Boys & Girls Club of Brockton has been chosen by The Phia Group’s CEO, Adam Russo, to receive the prestigious award of Youth of the Year. This member will receive a $5,000 college scholarship and a brand new laptop that will help them through the four years of college. We are proud to announce that Julieth Nwosu was chosen to receive this prestigious award! Congratulations, Julieth, and best of luck in college!

 


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The Stacks

The Self-Funded Case – Back To Basics

By: Tim Callender, Esq. – March 2019 – Self-Insurers Publishing Corp.

Without a plan document, what is a self-funded plan, truly? It is a nebulous financial instrument, or bizarre oral contract slightly memorialized by HR emails and broker notes that exists without clear guidance or application. Yet this plan is still subject to incredible responsibility and liability. Needless to say, not only is having a plan document a good idea (if not required, depending on how you read the law) but it is an even better idea to have a well-written and understandable plan document. As discussed above, many plan sponsors become enamored with new and innovative solutions, ranging from specialty Rx cost control to a medical tourism program filled with plan member incentives. These are wonderful solutions that may yield outstanding results – but what if the plan document does not properly support and outline the specialty Rx program? What if the plan document fails to provide clear instruction to the plan member on how he/she can take advantage of the beneficial medical tourism program? Not only does the plan sponsor run the risk of implementing benefit structures that may cause legal problems, since they are not outlined in the plan document, but the plan sponsor will most surely lose out on gaining the benefit of these innovative solutions. Not to mention paying claims outside the terms of the plan’s stop-loss policy. Without a well-written and understandable plan document, the it is pointless to pursue more complex solutions and the goals of cost containment and rich benefits will surely never be met.

Click here to read the rest of this article


The Profit Motive – A Necessary Evil?

 

By: Andrew Silverio, Esq. – February 2019 – Self-Insurers Publishing Corp.

Working in the self-funded healthcare industry, it can be easy for us to develop tunnel vision and focus on cost containment and affordability at all costs, losing sight of other valid interests within and relating to the healthcare market. Quality of care is an obvious one – if not done properly, reductions in cost can come at the expense of quality (of course, this isn’t always the case in healthcare, a product which so often has a great deal of inefficiency built in). But there are other, less directly related interests which we should keep in mind when we zoom out and look at the broader system, for example in forming policy decisions. The healthcare market is an ecosystem, and like in any ecosystem, one organism becoming too powerful can ultimately be a bad thing for everyone. A super-predator in an isolated system can quickly hunt its own prey out of existence and starve.

Click here to read the rest of this article

 

A Texas Federal Judge Declares The Affordable Care Act Unconstitutional: What Next?

By: Brady Bizarro, Esq. – January 2019 – Self-Insurers Publishing Corp.

On February 26, 2018, eighteen state attorneys general and two Republican governors filed suit in a Texas district court against the federal government over the constitutionality of the Affordable Care Act (“ACA”). While Texas v. United States is not the first serious legal challenge brought against the Obama administration’s signature healthcare law (see, e.g., King v. Burwell, 135 S. Ct. 2480 (2015); see also National Federation of Independent Business v. Sebelius, 567 U.S. 519 (2012)), it is the first in which the executive branch broke with tradition and declared that it would not defend the ACA in court. The case has certainly represented the most serious threat to the ACA since the GOP’s legislative efforts to repeal the healthcare law failed last summer. As it turns out, this threat should have been taken more seriously by industry analysts. On December 14, 2018, Judge Reed O’Connor of the U.S. District Court for the Northern District of Texas found that the ACA was unconstitutional.

Click here to read the rest of this article

To stay up to date on other industry news, please visit our blog.

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Phia’s 2019 Speaking Events:

Phia’s Speaking Engagements:

• 1/9/2019 – FMMA Conference – Austin, TX

• 2/27/2019 – Sunlife 2019 MVP Academy – Denver, CO

• 3/8/2019 – UnitedAg Conference – Anaheim, CA

• 3/19/2019 – SIIA Self-Insured Health Plan Executive Forum – Charlotte, NC

• 3/21/2019 – CGI Business Solutions Seminar – Woburn, MA

• 3/26/2019 – HFTA Broker Meeting – Tyler, TX

• 4/3/2019 – BenefitsPRO Broker Expo – Miami, FL

• 4/5/2019 – Pareto Conference – Nashville, TN

• 4/7/2019 – Captive Symposium – Cayman Islands

• 4/8/2019 – National Beer Wholesalers Association Legislative Conference – Washington DC

• 4/12/2019 – FMMA 2019 Annual Conference – Dallas, TX

• 4/23/2019 – Johns Hopkins Industry Education Series – Baltimore, MD

• 4/24/2019 – Sunlife 2019 MVP Academy – Kansas City, MO

• 4/25/2019 – BevCap’s Best Practices Workshop – Orlando, FL

• 4/26/2019 – Society of Professional Benefit Administrators Annual Conference – Washington, D.C.

• 5/2/2019 – MassAHU Benefest 2019 Conference – Westborough, MA

• 5/14/2019 – Cypress Unversity – Las Vegas, NV

• 5/30/2019 – Contrarian Captive – Austin, TX

• 6/11/2019 – Leavitt Conference – Big Sky, MT

• 7/15/2019 – HCAA TPA Summit – Dallas, TX

• 7/31/2019 – 2019 MVP Academy – Wellesley, MA

• 8/24/2019 – Well Health Workshop – Chicago, IL

• 10/27/2019 – 2019 Annual NASP Conference – Washington DC

 

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Get to Know Our Employee of the Quarter:
Andrew Fine

Congratulations to Andrew Fine, The Phia Group’s Q2 2019 Employee of the Quarter!

When Andrew first started at The Phia Group in 2017 as an intake specialist, it was clear that he was a perfect fit for not only his role, but for The Phia Group. Andrew is currently the Lead Intake Specialist for Phia’s Consulting department. Andrew has a great work ethic and maintains a positive attitude. The Consulting department can always rely on him to stay on top of client requests, as he is very efficient and organized.

 

Congratulations Andrew, and thank you for your many current and future contributions.

 

 


Phia News

 

Exceptional Business Award

The Phia Group is proud to announce that we have been presented with an Exceptional Business Award at the 11th Annual Mentor Recruitment Rally & Celebration! We take tremendous pride in our community and the youths of the Boys & Girls Club of Brockton - Allowing the young people of our community opportunities and platforms in which they can succeed has been rooted in our everyday business functions, leading to a promising future and a caring environment for all those involved.

 

 

Valentine’s Day at Phia

The Phia family celebrated Valentines Day with a guessing game! Everyone in the office was tasked with guessing how many candy hearts were in the glass jar… But we didn’t stop there… We challenged our followers on LinkedIn to join in on the fun. After an entire day of guesses being collected, we finally counted out the candy hearts. There were a total of 2,329 candy hearts in the glass jar! Congratulations to Jeff Hanna, of The Phia Group, who guessed 2,303. We would also like to congradulate Diana Denzin, who had the closest guess on our LinkedIn page, with a guess of 2,621.

 

 


 

Job Opportunities:

• Intake Specialist

• Attorney I

• Overpayments Recovery Assistant

• Health Benefit Plan Drafter

• Case Investigator I

• Provider Relations Client Concierge

See the latest job opportunities, here: https://www.phiagroup.com/About-Us/Careers

 

Promotions

• Ron Peck has been promoted from Sr. VP and General Counsel to Executive Vice President and General Counsel

• Julie Martin has been promoted from VP, Recovery Services to Sr. Vice President, Recovery Services

• Jen McCormick has been promoted from VP, Consulting to Sr. Vice President, Phia Group Consulting

• Chris Aquiar has been promoted from Director, Recovery Services to Vice President, Legal Recovery Services

• Hemant Dua has been promoted from Sr. Director of IT to Vice President of Technology

• Brady Bizarro has been promoted from Director, Healthcare Attorney to Director of Legal Compliance & Regulatory Affairs (LCARA)

• Andrew Silverio has been promoted from Health Benefit Plan Admin - Attorney III to Compliance & Oversight Counsel

• Philip Qualo has been promoted from HR Compliance Specialist to Compliance & Regulatory Affairs Consultant

• Sean Donnelly has been promoted from Corporate Counsel to Associate General Counsel

• Cara Carll has been promoted from Senior Team Lead to Manager of Case Evaluation, Customer Service & Claim Analysis

• Amanda Lima has been promoted from Provider Relations Team Lead to CEO Executive Assistant and Manager of Provider Relations

• Cindy Monfils has been promoted from Account Coordinator/Paralegal to COO Executive Assistant/Paralegal

• Jamie Johnson has been promoted from Team Lead, Sr. Recovery Team to Team Lead, Bodily Injury

• Rose Jardim has been promoted from Team Lead of Accounting to Supervisor of Accounting

• Ekta Gupta was promoted from Coordinator, Data Services Group to Manager, Data Services Group

• Erin Hussey has been promoted from Attorney I to Attorney II

• Andrew Fine has been promoted from Intake Specialist to Lead Intake Specialist.


 

New Hires

• Robyn Sullivan was hired as an Executive Assistant

• Robert Martinez was hired as an Attorney in the Provider Relations Department

• Robyn Cleaves was hired at a Team Lead in Accounting

• Shawndell Dias was hired as a Case Investigator

• Scott Byerely was hired as the Vice President, Operations and Total Quality Management



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info@phiagroup.com
781-535-5600

The Stacks - 2nd Quarter 2019

On April 19, 2019

A Texas Federal Judge Declares The Affordable Care Act Unconstitutional: What Next?

By: Brady Bizarro, Esq.

On February 26, 2018, eighteen state attorneys general and two Republican governors filed suit in a Texas district court against the federal government over the constitutionality of the Affordable Care Act (“ACA”). While Texas v. United States is not the first serious legal challenge brought against the Obama administration’s signature healthcare law (see, e.g., King v. Burwell, 135 S. Ct. 2480 (2015); see also National Federation of Independent Business v. Sebelius, 567 U.S. 519 (2012)), it is the first in which the executive branch broke with tradition and declared that it would not defend the ACA in court. The case has certainly represented the most serious threat to the ACA since the GOP’s legislative efforts to repeal the healthcare law failed last summer. As it turns out, this threat should have been taken more seriously by industry analysts. On December 14, 2018, Judge Reed O’Connor of the U.S. District Court for the Northern District of Texas found that the ACA was unconstitutional.

 

His decision has rattled the markets, Democratic political leaders, advocacy groups, and the broader healthcare industry. One prominent Democratic senator remarked, “This is a five alarm fire – Republicans just blew up our healthcare system.” Senate Minority Leader Chuck Schumer (D-NY) called it an “awful ruling . . . [which, if not reversed] will be a disaster for tens of millions of American families, especially for people with pre-existing conditions.” After taking a closer look at this ruling, however, many legal experts have concluded that it is not nearly as earth shattering as the headlines have made it appear.

 

First, Judge O’Connor’s ruling did not block enforcement of the ACA despite the fact that the plaintiffs had asked the court to issue a nationwide injunction on the federal government from implementing, regulating, or enforcing the ACA. Since the judge declined, all of the existing provisions of the ACA with which employers, fully insured plans, and self-funded plans must comply are still in effect. This decision has no effect whatsoever on plan design, on cost containment, on employee incentives, or on regulatory compliance. A quick check of Healthcare.gov post-ruling revealed that federal officials have even added this reassuring message: “Court’s decision does not affect 2019 enrollment coverage.”

 

Second, a spokeswoman for the California attorney general has already confirmed that the sixteen states (and D.C.) that stepped in to defend the ACA will appeal this district court ruling to the United States Court of Appeals for the Fifth Circuit in New Orleans, Louisiana. That means there is a chance that this decision could be overturned before the case reaches the Supreme Court. That possibility brings me to my third point; that legal scholars across the ideological spectrum have found the legal arguments made by the plaintiffs in this case to be remarkably unpersuasive. To understand why, let us break down the court’s opinion (which sided with those arguments).

 

Judge O’Connor’s opinion has two major elements. First, he contends that since Congress reduced the ACA’s individual mandate penalty to $0, the mandate to purchase insurance must be invalidated. Then, he argues that since the individual mandate is essential to and inseverable from the remainder of the ACA, the entire 2,000 page healthcare law must be struck down. This issue of “severability,” or whether one provision of a law can be severed without invalidating the entire law, is key. Prior to addressing severability, however, Judge O’Connor explains his constitutional analysis for finding that the individual mandate is no longer fairly readable as an exercise of Congress’s tax power.

 

Regarding his first contention, that the individual mandate could not be saved from the ACA, Judge O’Connor has made a rather compelling case. When the ACA was passed in 2010, the bill contained a requirement that all Americans purchase health insurance or pay a penalty. In 2012, the Supreme Court ruled that this requirement, known as the individual mandate, was a legitimate exercise of Congress’s constitutional authority to tax. See NFIB v. Sebelius (2012). In late 2017, in the Tax Cuts and Jobs Act (“TCJA”), Congress zeroed out the penalty associated with the tax, meaning the individual mandate can no longer reasonably be considered a tax. As such, the constitutional foundation identified by the majority of the Supreme Court, on which the individual mandate was based, was invalidated (recall that the majority in NFIB v. Sebelius also declined to sustain the individual mandate’s constitutionality under the Commerce Clause).

 

With respect to Judge O’Connor’s second contention, that the entire ACA must fall, many legal experts strongly disagree. Nothing in the original 2010 bill spoke to the severability of the individual mandate. Typically, when lawmakers neglect to include a severability clause in a bill, courts look to discern the intent of Congress when considering whether finding a particular provision of a law unconstitutional would require the elimination of the entire law. In NFIB v. Sebelius, the majority never addressed severability with respect to the individual mandate since the Court upheld the requirement. Four dissenting justices concluded that the individual mandate was unconstitutional and that Congress intended the entire ACA to be invalidated without the individual mandate.

 

Judge O’Connor assumes that the intent of the 2010 Congress controls the severability analysis in the case before his court; an intent only discerned by a minority of the Supreme Court. Indeed, he spends most of his 55-page opinion attempting to discern the intent of the 2010 Congress on his own. In doing so, however, he ignores the intent of a later Congress that did speak to the issue of severability in the form a later legislative act. The 2017 Congress, in passing the TCJA, eliminated the individual mandate and preserved the rest of the ACA. This act presents strong evidence that Congress intended the ACA to function without the individual mandate. Judge O’Connor’s explanation for this fact is that the 2017 Congress was unable to repeal the individual mandate because of budget rules and it therefore had no intent with respect to the individual mandate’s severability.

 

By assuming Congress had no intent because it was shackled by complicated legislative rules, Judge O’Connor has drawn the ire of most of the legal community. If he had been so sure of his position, why would he neglect to issue a nationwide injunction on the ACA, as he could have done? True, throwing a wrench into the middle of the healthcare system, where $600 billion in federal funding and health insurance coverage for millions of Americans is on the line, would have been a drastic action; however, if Judge O’Connor truly believed Congress intended this, he could have blocked enforcement of the ACA across the country.

 

I could go on at length about the consequences if this ruling were to stand; the impact on employer-sponsored plans, the effect on those with pre-existing conditions, the potential loss of health insurance coverage for millions of individuals, and the end of the Medicaid expansion. Yet, based on the response from the legal community of which I am a part, my position is that this decision rests on very shaky ground. This decision also goes much further than even the Trump administration had wanted (it wanted to preserve protections in the law for people with pre-existing medical conditions). I fully expect this case to be reversed by the United States Court of Appeals for the Fifth Circuit and to eventually be declined by the Supreme Court.

 

In short, we should all hold our collective horses and conduct business as usual for the time being.

__________________________________________________________________________________________

The Profit Motive – A Necessary Evil?

By: Andrew Silverio, Esq.

Working in the self-funded healthcare industry, it can be easy for us to develop tunnel vision and focus on cost containment and affordability at all costs, losing sight of other valid interests within and relating to the healthcare market.  Quality of care is an obvious one – if not done properly, reductions in cost can come at the expense of quality (of course, this isn’t always the case in healthcare, a product which so often has a great deal of inefficiency built in).  But there are other, less directly related interests which we should keep in mind when we zoom out and look at the broader system, for example in forming policy decisions.  The healthcare market is an ecosystem, and like in any ecosystem, one organism becoming too powerful can ultimately be a bad thing for everyone.  A super-predator in an isolated system can quickly hunt its own prey out of existence and starve.

CNBC published an article recently about a disease called nonalcoholic steatohepatitis, or “NASH.”  It develops from nonalcoholic fatty liver disease, which has been estimated by the Center for Disease Analysis to impact 89 million Americans, and can lead to cirrhosis, cardiac and lung complications, liver cancer, and death.  As a result of the obesity epidemic, particularly around the western world, the disease is becoming increasingly common, and the National Institute of Health now states that as many as 30 million Americans, or 12 percent of adults, have NASH.   It’s estimated that by 2020 NASH will surpass hepatitis C as the leading cause of liver transplants in the United States, as increasingly younger Americans, now often in their 20s and 30s, are developing the disease.

As alarming as these numbers are, there is still no FDA approved treatment for NASH.  Yet.

With a global market for a cure estimated at $35 billion (with a b) dollars, pharmaceutical companies are quite literally racing to get new drugs approved and onto the market.  There are currently 55 NASH drugs in various stages of clinical trials according to BioMedtracker, so new treatments are clearly on the horizon.

That $35 billion pot of gold is the sole reason so many companies are sinking so much money into just having a shot at being first to market.  The market may be months away from a cure, it may be a few years away – we’re not doctors or medical researchers – but what we can say with confidence is that whatever the timeline is, it would be much longer without that mammoth payoff as motivation.  Manufacturers of new specialty drugs are allowed to charge, and regularly receive payment of, absolutely absurd prices.  But in some cases, as appears to be the case with NASH, it is precisely because of this that we will soon have treatment for a disease which would otherwise continue taking lives unchecked.

This ability of manufacturers  to charge and receive such high rates for new drugs has also given rise to an entire new sub-industry based around medical tourism and drug importation. In attempting to get patients access to new specialty drugs at a reduced cost to employers, numerous programs aimed at securing generic versions not yet available in the United States are enjoying success under several different models.  These programs run the whole spectrum, from acting to facilitate shipment by a foreign pharmacy in Canada or Mexico to the American patient, or sending that patient to a border to cross over and pick up a drug themselves, all the way to a concierge service where a patient flies first class to the Caribbean, is put up in a hotel, and receives their treatment in a tropical paradise.  The fact that this third option can actually still be significantly less expensive than the patient simply picking up the American version of a drug at the pharmacy down the street from his or her home is quite telling.

Other types of cost-containment efforts take aim at getting the amounts a plan has to actually pay for these drugs under control.  Again, these programs vary greatly and can take the form of exclusions for certain specialty drugs, exclusions for all specialty drugs, or unique cost-sharing structures where copayment amounts change based on whether payment might be available from another source or based on the particular drug.  Seemingly recognizing the impossibility of an individual without insurance paying for these drugs out of pocket, manufacturers implement assistance programs to help cover patient copayments, or offer discounts or rebates for those who pay completely out of pocket.  Other programs aim to identify when these programs might be available and steer that monetary benefit back toward the health plan.

The fact that all these different approaches are necessary illustrates an important principle which is often overlooked – the profit incentive to develop new drugs and therapies.  America is a global leader in developing new therapies, and is by far the biggest healthcare spender per capita and arguably guilty of the greatest waste.  Can the former continue to be true without the latter?  If not, to what extent are we willing to sacrifice innovation and the development of new therapies for those few with no remedies available for their illnesses, in order to ensure that the masses can receive vital routine care in an affordable way?

Food for thought.

______________________________________________________________________________________________

The Self-Funded Case – Back To Basics

By: Tim Callender, Esq.

Self-Funding – So Many Toys in the Sandbox

Not to criticize our industry, in the least, but if we are being honest, we should all agree that it takes thousands of “parts” to make this “car” run, so to speak.  This fact has its positives.  An industry chock full of numerous stakeholders does lead to incredible innovation, teamwork, healthy competition, creative solutions, and the general strength that comes with an industry steeped in camaraderie.  Likewise, this reality of many stakeholders can also create confusion and distraction unless we are paying close attention and working to block out the noise.  The typical self-funded case will likely have a list of stakeholders that include (in no particular order & I am sure to leave something / someone out):

  • The broker / consultant
  • The employer, plan sponsor
  • A benefits committee and/or benefits decisionmakers within the plan sponsor
  • A third-party administrator or a carrier ASO platform
  • A plan document solution provider
  • A pharmacy benefits manager
  • A specialty Rx cost containment solution provider
  • A case management / utilization management solution provider
  • A concierge and/or centers of excellence solution
  • A stop-loss carrier / managing general underwriter
  • Internal legal counsel
  • External legal counsel
  • Legal counsel for all the solution providers
  • A dialysis cost-containment solution provider
  • A claim re-pricing solution provider
  • A network
  • A wrap network or wrap network alternative
  • A claim negotiation solution and/or patient advocacy solution provider
  • A data analytics platform
  • A claims auditing solution provider
  • A number of independent review organizations
  • A subrogation and recovery solution provider
  • And many, many, more…. (I felt the bullet points were becoming excessive – time to stop)

In short – there are many, many toys in this sandbox of self-funding.

So…. How About, Back to Basics?

As discussed, there are an incredible number of stakeholders in the self-funding sandbox. To reiterate, this is not necessarily a bad thing, but it can steer us away from the fundamental basics and core needs of our industry, which can lead us astray from the root goal.  What is that goal?  In short, most self-funded plan sponsors are going to tell you that they entered into the self-funded space for two reasons: (1) to bring the costs associated with their health plan down; and (2) to have the creative control needed to deliver top-notch health benefits to their employees and their families. 

Not to take away from the importance of the newest healthcare-related iPhone app, or the newest, innovative methodology behind case management, but sometimes it is important to step back and focus on the basics of this complex, self-funded system.  Whether from the outside looking in, or deeply involved in the self-funded industry, all viewers should agree that this industry – this system – is definitely a complex one, as noted by the copious bullet points listed above.  To wade through the complex and try to identify the key roots of a successful self-funded case is not only a noble pursuit but should be a point of pride for all in this space.  With the roots in place, all of the other, more complex solutions can fall into place and will do so with a much higher likelihood of success.

While like minds might rightly differ on the key elements that lead us toward the goals discussed above, I would list out the five most important roots that push the goals of driving down costs while delivering great benefits as follows:

  1. A well-written and understandable plan document.
  2. A vested “benefits committee” or other decision-making body housed within the employer Plan Sponsor.
  3. An educated and empowered consultant.
  4. A partner-focused third-party administrator.
  5. A well-oiled subrogation and recovery platform.

The All Powerful and Governing Document

Without a plan document, what is a self-funded plan, truly?  It is a nebulous financial instrument, or bizarre oral contract slightly memorialized by HR emails and broker notes that exists without clear guidance or application.  Yet this plan is still subject to incredible responsibility and liability.  Needless to say, not only is having a plan document a good idea (if not required, depending on how you read the law) but it is an even better idea to have a well-written and understandable plan document.  As discussed above, many plan sponsors become enamored with new and innovative solutions, ranging from specialty Rx cost control to a medical tourism program filled with plan member incentives.  These are wonderful solutions that may yield outstanding results – but what if the plan document does not properly support and outline the specialty Rx program?  What if the plan document fails to provide clear instruction to the plan member on how he/she can take advantage of the beneficial medical tourism program?  Not only does the plan sponsor run the risk of implementing benefit structures that may cause legal problems, since they are not outlined in the plan document, but the plan sponsor will most surely lose out on gaining the benefit of these innovative solutions.  Not to mention paying claims outside the terms of the plan’s stop-loss policy.  Without a well-written and understandable plan document, the it is pointless to pursue more complex solutions and the goals of cost containment and rich benefits will surely never be met.   

The Heart & The Brain

Every employer plan sponsor should have a benefits committee in place, whether the committee is made up of 3 people or 15 people.  Too many employers rely solely on the expertise of their consultant and “pass the buck,” so to speak, when it comes to truly understanding the ins and outs of their self-funded plan.  Not to say that relying on a consultant is a bad thing – that’s why they exist!  However, as any expert will tell you, the expert’s job is always easier when he/she is advising an educated consumer.  An educated plan sponsor, backed by a benefits committee full of diverse knowledge and expertise, and advised by an industry expert consultant, is already leaps and bounds ahead of the rest when it comes to the ability to choose and implement solutions that will lead to cost savings and rich benefits.  Not to mention, the committee can share the labor burdens associated with running a self-funded health plan.  Like, working together to finalize that plan document! 

Additionally, a benefits committee increases the chances of a plan successfully implementing a complex solution.  Let’s use an out-of-network, reference-based pricing solution as a singular example.  Such an innovative and disruptive program does not stand a chance if there is not employee / member buy in and understanding.  There will likely be balance billing and “scary” situations which will lead plan members to bring the noise, so to speak, directly to HR.  This noise can quickly cause enough pain that the plan sponsor will choose to abandon an otherwise legitimate and beneficial program.  But.  What if a savvy, vested, and educated benefits committee existed, at the employer, plan sponsor level?  Imagine the education and communication opportunities that could exist – imagine the opportunities to work with the plan members, ask critical questions of the vendor, and course correct when needed. 

A benefits committee, whether small or large, will move a plan closer to its goals of containing costs and delivering rich benefits, every time. 

Likewise, it takes the industry expert consultant to advise this bought in committee and bring them the solutions and ideas that they may not be aware of, that they can then interpret and execute, on their own terms.

To repeat: the vested benefits committee plus the expert consultant = reduced plan costs and the implementation of solutions to drive rich benefit delivery. 

The Partner

A sophisticated plan sponsor, governed by a benefits committee and advised by an expert consultant, should next seek a true partner in its third-party administrator.  Plan sponsors can sometimes fall victim to regionalism or sticker attraction (seeking out the lowest administrative fee), which may not always lead to the best payor partner for that particular plan.  Instead, plan sponsors and their consultants should begin by clearly understanding and defining their own needs and their own goals.  They must do this first before trying to find the right payor partner.

Is the plan focused on a strong network?  An in-house dialysis solution?  Is a domestic call center presence important?  What about reporting capabilities?  What does the account management model look like and how involved will they be with enrollment meetings and finalizing the plan document?  Will the payor listen to the plan’s recommendations and needs regarding stop-loss?  The list goes on. 

Needless to say, combining a thoughtful benefits committee, with an expert consultant, and a true partner-oriented payor, will allow for a plan to truly innovate and successfully put solutions in place that will meet the plan’s goals.

The Money at The End of The Chain

In thinking on the goals of driving costs down while delivering great benefits, there is one area that provides a clear “win.”  Subrogation and recovery efforts. 

Why is this the case?  In efforts to contain costs, many plans go straight to the overly advertised, upfront, disruptive solutions that may drive costs down before costs are incurred.  Many of these solutions have merit and bear fruit! But plan sponsors should not lose sight of the big recovery win that is available through a robust subrogation and recovery platform.  Especially now, where copious opportunities exist to seek the recovery of plan dollars on so many fronts.  Traditionally, most plans would focus their recovery efforts on the routine motor vehicle accident – the benchmark example of third-party liability.  Anymore though, alongside these benchmark MVAs, plans should be considering other sources of third-party liability, such as torts, product recalls, and class actions.  The list, and opportunities, go on.    

Additionally, whether governed by ERISA or state law, or a combination of both, all self-funded plans are bound by some level of fiduciary duty.  Instead of quoting federal or state law, the gist is this: plan fiduciaries must behave prudently with plan assets, which includes how the fiduciaries spend plan assets, don’t spend plan assets, or get plan assets back!

To this end, it is easy for a plan sponsor to focus on asset expenditure and upfront plan savings, while forgetting about recovering dollars from a third party.  This is understandable!  Upfront expenses and upfront plan savings are exactly that, “upfront!”  But, the concept of chasing around a third party, sometimes for years, in an effort to return plan funds back to the plan – well, it is easy to see how this concept can fall by the wayside and become easily forgotten.  Yet, maximizing recovery efforts should be just as important to a plan fiduciary as the more routine, upfront savings and expenses that usually take priority.  Seeking to assure that subrogation and recovery efforts are maximized is an important obligation of every plan fiduciary.  Not to mention, returning plan assets into the plan’s coffers means costs can be kept down and the plan can reinvest those dollars in other areas that might lead to that richer, more robust health plan. 

Goals met.

 

The Phia Group's 1st Quarter 2019 Newsletter

On January 9, 2019


Phone: 781-535-5600 | www.phiagroup.com



The Book of Russo:
From the Desk of the CEO

With 2018 in the rear view, it's important that we look back at such a historical year, while also moving forward to fine-tune our focus here at The Phia Group. In 2019, we will hone in on the highest priorities on behalf of our industry, to make certain that the momentum of innovation continues on. All of you must begin to empower your benefit plans. Healthcare has been, and continues to be the number one issue when discussing politics, law, and the economy. It is important to stay aware of change and the most cutting edge options, while also addressing each employer’s unique attributes and specific needs. We must create an understanding of what the best administrators are offering, so that we can in turn identify the best options for your benefit plan and all parties involved. Make it your resolution to understand the various types of plan components that are needed to stay competitive, while maximizing benefits and minimizing costs. I truly believe, we here at The Phia Group, have the tools to empower you to take control of your plan. Happy reading!


Service Focus of the Quarter: Independent Consultation & Evaluation (ICE)
Phia Group Case Study: Subrogation
Phia Fit to Print
From the Blogosphere
Webinars
Podcasts
The Phia Group’s 2019 Charity
The Stacks
Phia’s Speaking Events
Employee of the Quarter
Phia News

 

Service Focus of the Quarter: Independent Consultation & Evaluation (ICE)

Here at The Phia Group, we are not a TPA, but we know TPAs like the back of our hand. That is why we developed our Independent Consultation and Evaluation service, colloquially known as ICE.

We know how difficult processing claims can be, especially when those claims involve complex situations. Asking Plan Administrators for guidance to avoid potential liability is always a good idea, but is sometimes not feasible due to time constraints or simply the fact that most plan administrators are not well-versed in the art and science involved in claims processing. Your clients are school districts, or textile manufacturers, or labor unions; what can they reasonably be expected to know about the law related to when an illegal acts exclusion can be applied, and when it cannot?

Enter The Phia Group’s ICE service. We are experts in the law related to health benefit offerings, and we know plan documents like Tom Brady knows a pigskin. ICE was created to ensure that health plans and the TPAs that work with them have a resource to tap when things get hairy – and since it is billed on a predictable PEPM rate, rather than on an hourly basis, it is affordable and accessible, and there are no surprises.

Contact our Vice President of Sales & Marketing Tim Callender, to learn more. Tim can be reached at 781-535-5631 or tcallender@phiagroup.com.

 

Phia Case Study: Subrogation

A TPA client of The Phia Group had been unable to resolve a $62,000 lien with the patient’s attorney. The patient was in a motor vehicle accident, and subsequently retained an attorney to pursue the other driver for damages. The Plan Administrator attempted to place the attorney on notice of the plan’s right to reimbursement, but received no response whatsoever from the attorney, despite numerous letters and phone calls. The TPA had given up, and mentioned this failed recovery to one of The Phia Group’s attorneys in passing, who promptly volunteered that we would revive this file for them and attempt a recovery.

The Phia Group essentially started over by sending letters and calling the attorney, which again garnered no responses, as expected. The Phia Group’s legal team elected to take a different approach: after researching state law and decisions rendered by the state’s bar association, The Phia Group’s next correspondence focused on the attorney’s own ethical obligations, rather than only the patient’s reimbursement obligations.

The Phia Group not only received a prompt (and somewhat repentant) response from the attorney, but secured an agreement signed by the attorney to hold all settlement proceeds in trust and to honor the health plan’s rights in full. About two years later, the TPA recovered 90% of its lien.

 


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Fiduciary Burden of the Quarter: Whether You Are A Fiduciary!

Simply put, federal law provides that with very limited exceptions, entities acting as fiduciaries may not disclaim such a designation. The law is fairly straightforward when it provides that “…any provision in an agreement or instrument which purports to relieve a fiduciary from responsibility or liability for any responsibility, obligation, or duty under this part shall be void as against public policy.” To elaborate on that, the U.S. Supreme Court has stated that, “not only the persons named as fiduciaries by a benefit plan…but also anyone else who exercises discretionary control or authority over the plan's management, administration, or assets, is an ERISA fiduciary.”

Keep in mind, however, that the fact that an entity such as a TPA may be a fiduciary, under the reasoning spelled out above, does not necessarily mean that the TPA has breached a fiduciary duty when/if a breach occurs.

Fiduciary status is determined on a case-by-case basis; the courts have been clear that fiduciary status is triggered by the exercise of any discretionary authority over the management of a plan’s disposition of its assets. Practically speaking, the main purpose of fiduciary duties is money; the U.S. Court of Appeals for the Sixth Circuit has summed it up very well by noting that “[a]n entity such as a third-party administrator becomes an ERISA fiduciary when it exercises practical control over an ERISA plan’s money.”

If you control money, you owe fiduciary duties to the beneficiaries or potential beneficiaries of that money. So…be careful! Consult a neutral third-party expert when you face difficult claims or benefits decisions.

 

Success Story of the Quarter: Independent Consulting & Evaluation (ICE)

A third-party administrator presented The Phia Group with the facts of a situation wherein one of their incoming groups, previously serviced by another administrator, had a great deal of antiquated and weak language in its Plan Document. Erin Hussey, an attorney at The Phia Group, reviewed the Plan and noticed particular issues within its “eligibility” section.

The first issue Erin spotted was language that incentivized Medicare-eligible employees to not enroll in their group health plan, and to enroll in Medicare instead. Erin noted that this provision was in violation of the Medicare Secondary Payer Act (“MSP”), which explicitly prohibits such incentives.

Second, the Plan Document explained that retiree coverage was not offered to non-executive employees. Erin noticed that this may run afoul of §105(h) non-discrimination rules; these rules prohibit group health plans from treating highly-compensated individuals (“HCIs”) more favorably than non-HCIs. Therefore, by providing retiree coverage to only executives (who are far more likely to be HCIs), this language seemed to violate the 105(h) rules.

Erin communicated these findings to The Phia Group’s client, who was understandably concerned with the language issues. Erin explained the applicable law, the TPA’s responsibilities, and potential issues and penalties that could arise, and she provided a set of best practices for the TPA to follow in such circumstances. Based on the information Erin imparted, The Phia Group’s client was able to work with the employer group to correct the language and avoid likely MSP and 105(h) penalties in the face of a federal government that has been cracking down on violations of federal law such as these.

This is a perfect example of a way that health plans can avoid problems before they arise! The Phia Group’s ICE service helps TPAs, plans, and brokers with issues with claims, appeals, and other concrete issues – but where ICE can help the most is by preventing tough problems before they arise!
 

 


 

Phia Fit to Print:

• Money Inc. – A Conflict of Intent: Why We Can’t Achieve a Meeting of the Minds on Healthcare – December 12, 2018

• Self-Insurers Publishing Corp. – The Modernization of Health Savings Accounts – December 3, 2018

• Free Market Healthcare Solutions – Prescription Drug Prices Bridge a Divided Electorate in Election Season – November 28, 2018

• Money Inc. – Dialysis Providers Withstand Regulatory Haymaker – November 26, 2018

• The Inquirer: Daily Philly News – Main Line Hospital Charges $63 for Olive Oil Used to Turn a Breech Baby – November 20, 2018

• Self-Insurers Publishing Corp. – Don't Let Your Loss Leave You DOA: Part II - States Speak Up! – November 2, 2018

• Self-Insurers Publishing Corp. – Explanations That Benefit – October 4, 2018

• Money Inc. – Why Does Reform Always Seem to Favor the Wrongdoer? – October 1, 2018

 



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From the Blogosphere:

A Texas Judge Strikes Down Obamacare – Our Take. Don’t miss out on this great blog post!

You Down with RBP? (You May Already Be!) Reference-based pricing is one of the most mysterious self-funding structures out there.

OSHA Publishes Guidance on Post-Accident Drug Testing. Here’s an explanation to these requirements and how they apply to particular circumstances.

Healthcare on the Ballot, and a Free Side of Fries! Let’s take a step back and assess the big picture.

Is Your Life Insurance Policy Subject to ERISA? You may think this is a ridiculous question; however, Plan Sponsors and employers may want to reconsider this inquiry in light of a recent Seventh Circuit ruling...

 

To stay up to date on other industry news, please visit our blog.



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Webinars

Click HERE to Register!

• On December 12, 2018, The Phia Group presented, “What to Expect in 2019 – Part 2,” where we discussed current industry happenings and our predictions to help you look forward to the coming year.

• On November 13, 2018, The Phia Group presented, “What to Expect in 2019 - Part 1,” where we discussed current industry happenings and our predictions to help you look forward to the coming year.

• On October 18, 2018, The Phia Group presented, “Specialty Drugs: Trends and Issues Affecting Self-Funded Plans,” where we discussed the rising costs of specialty drugs.

Be sure to check out all of our past webinars!



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Podcasts:Featuring Video Podcasts!

• On November 20, 2018, The Phia Group presented, “Politics With Brady,” where Brady and Ron analyze the recent election results, and determine how they will impact the health benefits and health care industries.

• On November 16, 2018, The Phia Group presented, “Talkin’ with TPAC,” where our hosts, Ron and Brady, enjoy chatting with Michael Meloch, President of TPAC Underwriters and valued member of The Phia Group’s own advisory board

• On November 1, 2018, The Phia Group presented, “Special Edition: Talking Politics, Elections, and Healthcare,” where our hosts discuss healthcare on the ballot.

• On October 22, 2018, The Phia Group presented “AHPs: Will They Live Up to the Hype,” where our hosts discuss the benefits and hurdles the final rules have created for these new AHPs.

• On October 15, 2018, The Phia Group presented “2019 - Fly Ball or Home Run,” where Ron and Adam discuss the many issues, changes and challenges 2018 has lined up for 2019.

• On October 1, 2018, The Phia Group presented “Learn from the Past to Shape the Future,” where our hosts sit down with industry legend and innovative leader, Jerry Castelloe of Castelloe Partners.

Be sure to check out all of our latest podcasts!

 

Face of Phia

• On November 29, 2018, The Phia Group presented, “Flying High with Judy,” where Ron and Adam sit down with a member of The Phia Group’s Customer Service team, Judith McNeil.

• On November 16, 2018, The Phia Group presented, “Not Your “Norma-l” Employee,” where our hosts, Adam Russo and Ron Peck, sit down with a member of The Phia Group’s Accounting team, Norma Phillips.

• On October 24, 2018, The Phia Group presented, “A Chat With Matt,” where Adam Russo and Ron Peck sit down with The Phia Group’s Marketing & Accounts Manager, Matthew Painten.

 



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The Phia Group’s 2019 Charity

At The Phia Group, we value our community and everyone in it. As we grow and shape our company, we hope to do the same for the people around us.

The Phia Group's 2019 charity is the Boys & Girls Club of Brockton.

The mission of The Boys & Girls Club is to nurture strong minds, healthy bodies, and community spirit through youth-driven quality programming in a safe and fun environment.

The Boys & Girls Club of Brockton (BGCB) was founded in 1990 to create a positive place for the youth of Brockton, Massachusetts. It immediately met a need in the community; in the first year alone, 500 youths, ages 8-18, signed up as club members. In the 25 years since, the club has expanded its scope exponentially by offering a mix of Boys & Girls Clubs of America (BGCA) nationally developed programs and activities unique to this club.

Since their founding, more than 20,000 Brockton youths have been welcomed through their doors. Currently, they serve more than 1,000 boys and girls ages 5-18 annually through academic year and summertime programming.

 

Thanksgiving – A Special Delivery

On Wednesday, November 21st, the Phia family went out to our local grocery store and purchased a total of 20 Thanksgiving dinners for the families of The Boys & Girls Club of Brockton. Once we loaded them up in our cars, we personally delivered them to the families. Words cannot express the feeling we got when we saw the looks on those families’ faces.

 

Christmas Tree Angel

Each year employees of The Phia Group pick nametags from the Angel Tree that sits in our main lobby. On those tags are names, ages and the wish lists of children from The Boys & Girls Club of Brockton. This year we had over 100 nametags! The Phia family loves to give back to the community; our greatest joy is providing these children with all of their holiday wishes.

 

Unwrapping Christmas

Santa and his elves made a surprise visit to the Boys & Girls Club of Brockton, one week before Christmas. Santa had sent a special elf to the Boys & Girls Club a couple of weeks prior to their visit to ask each child what they wanted most for Christmas. Santa and his elves gave out over 100 gifts to these amazing and talented children. We love giving gifts, but we really love receiving those smiles in return.  



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The Stacks

The Modernization of Health Savings Accounts

By: Krista J. Maschinot, Esq. – December 2018 – Self-Insurers Publishing Corp.

HSAs are highly regulated, tax-exempt savings accounts that both individuals and employers may contribute to on behalf of individuals covered by certain high-deductible health plans (HDHPs). These accounts are designed to help individuals set aside funds to be used for the qualified medical expenses of the individuals, their spouses, and their tax dependents. Unlike flexible spending accounts (FSAs), HSAs are not subject to mandatory “use it or lose it rules” and while FSAs are not portable, HSAs are portable as they are owned by the individual, not the employer, and can follow the individual as he or she changes jobs similar to a 401(k) or an individual retirement account (IRA). HSAs can be invested similar to a retirement account and have the ability to grow over time making them a valuable retirement vehicle. They are funded on a pretax basis through a cafeteria plan and result in a triple tax savings for the individual as they are funded with pretax dollars, grow tax-free, and are not taxed upon withdrawal so long as they are used to pay for qualified medical expenses.

Click here to read the rest of this article


Don't Let Your Loss Leave You DOA: Part II - States Speak Up!

By: Kelly E.Dempsey, Esq. – November 2018 – Self-Insurers Publishing Corp.

Remember that scenario from Spring of 2017 where an employer was attempting to do right by an employee and offered a continuation of coverage during an employer-approved leave of absence? If not, let’s quickly refresh our memories.

An employer’s long-time trusted employee had a stroke of bad luck and was diagnosed with stage four cancer after being relatively asymptomatic and having never been diagnosed with cancer previously. As the employee’s treatment plan became more aggressive, the employee ultimately needed to take a leave of absence – but leave under The Family and Medical Leave Act (FMLA) was exhausted due to the employee’s recent addition of a new baby. The employer subsequently continued to provide coverage, pursuant to 2016 guidance issued by the United States Equal Employment Opportunity Commission regarding employer-provided leave in accordance with The Americans with Disabilities Act (ADA).

Click here to read the rest of this article

 

Explanations That Benefit

By: Jon Jablon, Esq. – October 2018 – Self-Insurers Publishing Corp.

In the course of working with many different third-party administrators, it has become clear that every TPA operates differently. Claims processes are no exception; although federal law prescribes certain rules and regulations for the basics of what must be done and how, TPAs and health plans are left to their own devices to figure out the nuts and bolts of their particular processes. The only real requirement is that those processes fit in with the regulators’ rules and vision for how the industry should operate.

Click here to read the rest of this article

 

To stay up to date on other industry news, please visit our blog.

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Phia’s Q4 Speaking Events:

Phia’s Speaking Engagements:

• 1/9/2019 – FMMA Conference – Austin, TX

• 2/27/2019 – Sunlife 2019 MVP Academy – Denver, CO

• 3/8/2019 – UnitedAg Conference – Anaheim, CA

• 3/21/2019 – CGI Business Solutions Seminar – Woburn, MA

• 3/26/2019 – HFTA Broker Meeting – Tyler, TX

• 4/3/2019 – BenefitsPRO Broker Expo – Miami, FL

• 4/5/2019 – Pareto Conference – Nashville, TN

• 4/7/2019 – Captive Symposium – Cayman Islands

• 4/11/2019 – FMMA Conference – Dallas, TX

• 4/24/2019 – Sunlife 2019 MVP Academy – Kansas City, MO

• 4/25/2019 – Best Practices Workshop – Orlando, FL

• 5/30/2019 – Contrarian Captive – Austin, TX

• 6/11/2019 – Leavitt Conference – Big Sky, MT

• 7/31/2019 – 2019 MVP Academy – Wellesley, MA

• 8/24/2019 – Well Health Workshop – Chicago, IL

• 10/27/2019 – 2019 Annual NASP Conference – Washington DC

 

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Get to Know Our Employee of the Quarter:
Philip Qualo

Congratulations to Philip Qualo, The Phia Group’s Q4 2018 Employee of the Quarter!

Since he started just over 6 months ago, Philip has proven himself instrumental to our compliance team. He has shown a passion for and commitment to ensuring that our company remains compliant with state and federal laws as we have continued to grow and thus become subject to new and increasingly complex regulations. In particular, he played a lead role in updating and revising our Employee Handbook, even tackling the rather arduous process of researching state law and creating supplements for each of the 11 states in which we now have remote employees. In addition to internal compliance efforts, Philip has produced high-quality consulting work for our clients. Successfully functioning in a dual-role is never easy for a new employee, especially when those roles involve sensitive human resources and compliance matters. Philip has performed admirably, and for that, he has earned our trust, and earned my Passion Award nomination.

 

 

Congratulations Philip and thank you for your many current and future contributions.

 

Get to Know Our Employee of the Year:
Brady Bizarro

Congratulations to Brady Bizarro, The Phia Group’s 2018 Employee of the Year!

Brady has made his mark here at The Phia Group. Between traveling, speaking on our webinars and gracing industry leaders with his knowledge of politics and D.C. happenings at conferences around the United States, we would like to thank him for all that he has done. You truly exemplify what Phia employees should strive to be.

 

Congratulations Brady and thank you for your many current and future contributions. 

 

 


Phia News

 

Announcement of SIIA’s Next Chairman

Adam V. Russo, CEO of The Phia Group, will serve as the chairman of SIIA’s board of directors. Adam has been a long-time active SIIA member and will be concluding five years of service as a director. Congratulations to Adam and thank you for all fo the hard you and dedication.

 

A Phia Halloween

How great are these costumes? This year, the Phia Halloween Costume Contest was truly a nail-biter. Who would win? Rafiki? The clown? The fan favorite “Gambina the Unicorn riding Sprinkles the Unicorn,” bravely worn by Gambit Hunt, ultimately took home the gold. Thank you to all who participated, you truly made it a stellar Halloween!

 

Ugly Sweater Contest

Our Phia Family is so festive! Our “Ugly Sweater Day” was a hit and we thank all those who participated; congratulations to Norma (pictured below sporting a green and red number, with gold shoulders) for winning “Ugliest Sweater”!

 

 


 

Job Opportunities:

• Accounting Manager

• Staff Attorney, Provider Relations

• Case Investigator I

• Claims Analyst

• Health Benefit Plan Drafter

See the latest job opportunities, here: https://www.phiagroup.com/About-Us/Careers

 

Promotions

• Ekta Gupta was promoted from ETL Specialist to Manager, Data Services Group

• Gambit Hunt was promoted from Sales Coordinator to Sales Executive

 

New Hires

• Tammy Tran was hired as an Accounts Payable Coordinator

• Christina Veneto was hired as a Talent Acquisition Specialist

• Brittany Grueter was hired as a Case Investigator I

• Elise Mulready was hired as a Claim and Case Support Analyst

• Nicholas Bonds was hired as a Health Benefit Plan Admin - Attorney I

• Danijela Stanic was hired as a Health Benefit Plan Consultant I

• Michael Vaz was hired as a Sales and Accounts Coordinator



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