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2024 HIPAA Action Items for Health Plans

"Due December 23, 2024: [1] Update HIPAA policies and procedures.... [2] Update business associate agreements ... [3] Create attestation form.... [4] Update HIPAA training presentations.... Due February 16, 2026: Update Notice of Privacy Practices."

Recent Trends in Excessive Fee Litigation

"In evaluating the plausibility of excessive fee claims, courts have held plaintiffs to pleading standards focused on [1] the requisite specificity of alleged excessive fees; [2] whether comparisons used of such fees are appropriate 'apples-to-apples' comparisons; and [3] whether fees are truly excessive compared to the services rendered. In addition, lack of standing remains an important ground for potential dismissal."

Third Circuit Affirms Certification of ERISA Class Though Named Plaintiffs Had Not Invested in All Challenged Investment Options

"By tying alleged injuries to root decisions or broader courses of conduct, participants and beneficiaries may more readily be able to challenge a defined-contribution plan's investment lineup on a class basis, even if those participants and beneficiaries have not invested in each of the options about which they seek to complain." [Boley v. Universal Health Serv. Inc., No. 21-2014 (3d Cir. Jun. 1, 2022)]

Supreme Court Considers the Right Balance in ERISA Excessive Fees Case

"The justices search for the proper balance between preventing plan misconduct and imposing too many burdens on plan fiduciaries.... Justices Sotomayor and Kagan propose a middle ground.... The Court is wary of excessive litigation.... The Court seems unlikely to dispose of the case on standing or the 'large menu' defense." [Hughes v. Northwestern Univ., No. 18-2569 (7th Cir. Mar. 25, 2020; oral arg. transcript Dec. 6, 2021)]

Tax Bill's Impact: Consider Payment of Executive Comp Before Year-End

"Companies subject to the $1 million deduction limitation of Section 162(m) in 2018 may want to consider accelerating payment of compensation otherwise payable in 2018.... Annual bonuses in respect of 2017 are worthy of particular (and quick) examination."

ERISA Stock-Drop Litigation and the Dudenhoeffer 'More Harm Than Good' Pleading Standard

"It is not clear what specific facts a plaintiff could allege that would support the claim that a prudent fiduciary in the same circumstances could not have concluded that the proposed alternative actions would do more harm than good with respect to the plan's participants. One question is whether there can ever be disclosure of negative news with respect to a company's stock, or negative actions taken with respect to employer stock fund, that will not contribute to the lowering of the stock price and thereby, in the eyes of a prudent fiduciary, do more harm than good to current participants in the fund."

Cigna Ordered to Pay More Than $13 Million in Out-of-Network Healthcare Provider Billing Dispute

"The court's decision relied primarily on two findings. First, the court determined that Cigna improperly applied the 'exclusionary language' contained in the plans it administered. Second, the court determined that Cigna failed to establish that the relevant language in the plan documents created a constructive trust or equitable lien." [Connecticut General Life Ins. Co. v. Humble Surgical Hospital, No. 4:13-cv-3291 (S.D. Tex. June 1, 2016)]

Supreme Court Decision Addresses Subrogation Rights of Health Plans (Again)

"The Court noted that the Board could have enforced the lien against the settlement had it acted quickly. But when the Board acted it appeared that the identifiable funds were gone. And the law of equity does not permit the Board to enforce a lien in equity against Montanile's general or other assets. The fact that this is an ERISA plan doesn't change the result."

Texas Supreme Court Affirms Significant Houston Workers Pension Ruling

"Following extensive briefing and oral argument, the Texas Supreme Court ... ruled against the city and the handful of employees who had wanted to get early distribution of their pension benefit while continuing to be paid for the same job and also be eligible for a new 401(k) plan benefit." [Klumb, et al. v. Houston Municipal Employees Pension System, No. 13-0515 (Tex. Mar. 20, 2015)]

Same-Gender Spouses and 401(k) and Pension Plans: Does Your Plan Need to Be Amended by December 31, 2014?

"First, the plan sponsor should confirm that it has operationally complied with the requirements of the Windsor decision and the IRS rulings addressing [same-gender] spouses since June 26, 2013 (or, where appropriate and applicable, the Delayed Effective Date). Second, to the extent it hasn't done so already, the plan sponsor should review its qualified plans to determine whether any of the plans have a definition of spouse that is inconsistent with Windsor and the IRS rulings. If so, the plan will need to be amended by December 31, 2014 ... Third, when drafting the plan amendment, the plan sponsor will need to determine whether the plan relied upon the Delayed Effective Date[.]"