ERISA Compliance in Direct Contracting for Healthcare: Challenges for Employers and Providers

BARBRI

This CLE course will provide ERISA counsel and advisers guidance on direct contracting between employers and healthcare providers. The panel will discuss transparency rules impacting covered service providers, recent regulations and guidance under OBBBA, ERISA challenges associated with direct contracting for health benefits, practical and legal considerations in negotiating and drafting agreements between employers and healthcare providers, and other planning methods to ensure employer compliance with ERISA and other rules and regulations.

Description

The rise in healthcare costs has forced employers to consider contracting directly with healthcare providers to minimize expenses and improve the member experience associated with health benefits. Direct contracting arrangements can be complicated and require counsel and advisers to consider all legal ramifications to assist employers and providers.

Direct contracting agreements offer employers and healthcare providers an opportunity to work together, eliminating the need for some of the services provided by a third-party administrator (TPA). This approach can provide both parties with substantial benefits and a way to take on and understand the functions of the payor, administrator, and provider in the absence of a TPA. Furthermore, employers and providers negotiating direct contract agreements must comply with ERISA and other federal and state regulations.

Employer and provider arrangements inclusive of plan administrative services and the assumption of specific responsibilities by the provider are subject to ERISA rules governing service provider contracts and fiduciaries. These direct contracting arrangements must ensure that plan provisions and actions do not run afoul of the prohibited transaction rules or any fiduciary duties under ERISA.

Negotiations must involve careful consideration of the rules and limitations of HIPAA, the Affordable Care Act, ADA, OBBBA, and other regulations. Counsel must be knowledgeable of federal and state regulations to structure the direct contracting arrangement to secure the benefits to employers and providers and avoid compliance claims.

Listen as our panel discusses the federal and state law challenges associated with direct contracting for health benefits, practical and legal considerations in negotiating and drafting agreements, and planning methods to ensure compliance.

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