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Managing Premium Payments for Benefit Plans

"The Sixth Circuit Court of Appeals ... reversed a district court's dismissal of a claim for breach of fiduciary duty based on ERISA's 'ministerial function' exception. This holding concludes that the employer (Wal-Mart) indisputably exercised control over the Plan's assets as it handled the premium payments in question, thus acting as a fiduciary.... The language of the employer's Summary Plan Description may significantly mitigate its potential liability." [Chelf v. Prudential Ins. Co., No. 20-6097 (6th Cir. Apr. 12, 2022)]

Can You Offer COVID-19 Vaccine Incentives to Your Employees?

"If you want to offer the vaccine yourself or through a contracted third party, ... the incentives cannot be so substantial to employees that they are coercive.... These issues don't apply if you only require proof that your employees were vaccinated elsewhere in order to get the incentives ... If you choose to offer an incentive, you should consider offering employees with obstacles or objections to getting the vaccine the opportunity to earn the incentive in other ways that are related to your organization."

Phone Call Recordings May Be Requested by Claimants If They're Deemed Relevant to a Benefits Claim

"The DOL ... concluded that recordings of conversations with participants would not be excluded from any disclosure just because the claims administrator or plan doesn't include that recording within its own administrative record, doesn't treat the transcript or recording as a part of the claim's activity history through which the claim is developed, tracked, and administered or because that transcript or recording was created for quality assurance."

HHS Issues Report to Address Surprise Medical Billing

"Two proposed solutions to surprise billing mentioned in the Report are rate-setting and independent dispute resolution (IDR).... While opposition to surprise-bill-control legislation has been loud, it should not go without notice that the two largest physician staffing firms happen to be owned by private equity firms who together have spent approximately $58 million on television and radio commercials and nearly $1 million on Facebook ads since last summer in order to influence the surprise billing debate."

A Tale of Two Fiduciaries

"The court found that SmartCore had misappropriated plan participant contributions and used those funds for corporate purposes, resulting in the plan’s inability to pay medical claims.... SmartCore paid the balance on the medical claim the day before trial, but the court found that any payments made more than three years later do not constitute full compensation.... This case should serve as a cautionary tale for anyone who acts as a fiduciary to an ERISA benefit plan. " Kinsinger v. SmartCore, LLC, No. 17-643 (W.D.N.C. Aug. 27, 2019)]

New HRA Regs Spark Controversy

"Since the new HRAs will be more affordable than traditional group health coverage, these new options are expected to make it easier for small businesses to compete with larger businesses for talent. The most ardent supporters also believe that the expected increase in the individual market will spur competition, resulting in better options for consumers. Others have expressed several areas of concern with regard to the new regulations."

Disclosure Rules May Be Coming for Health Plans

"A bipartisan bill called the Lower Health Care Costs Act ... addresses surprise medical bills ... [and improves] transparency to ensure that pharmacy benefit managers pass along drug discounts to customers.... [D]eep inside the bill, on page 111, are new sweeping ... and onerous commission disclosure provisions.... [B]rokers would have to disclose their compensation, in writing, at the time an employer signs up for benefits, regardless of how large the employer is. Failure to comply might ultimately result in the employer being required to terminate its carrier or broker relationship.... Disclosure is also required anytime an employee makes written request for it."

Bipartisan Support for New Attempts to Control Prescription Drug Costs

"Lawmakers on both sides of the aisle are applauding two recent developments in the ever-raging battle to contain the cost of American healthcare. On May 8, 2019, [HHS] announced a final rule ... that will soon begin requiring pharmaceutical manufacturers to disclose the list price of prescription drugs in television advertisements.... In an unrelated move just a few days later, 43 states and Puerto Rico filed a lawsuit in federal court in Connecticut, alleging that at least 20 drug manufacturers conspired to artificially inflate and manipulate prices for more than 100 different generic medications."

Telehealth: Healthcare's New Frontier

"Employers and insurers are attracted to telehealth by its relatively low cost as compared to traditional healthcare.... For an employer who is considering offering a telehealth option to its employees, there are some important choices to be made. First, which service model will be offered? Second, will telehealth be offered as a stand-alone benefit or integrated into the existing group health plan?"