Welfare Benefit Plan ERISA News
May 2013

"The importance of clear and unambiguous plan language cannot be overstated."
"The Second Circuit recently applied this well-established principle to conclude that a plan's administrative claims process must clearly state all of the types of claims that must be exhausted in order to prevent participants and beneficiaries from proceeding directly to court... To eliminate potential ambiguity in a plan's claims procedures concerning the types of claims that the procedures apply to, plan sponsors and fiduciaries should review plan documents and summary plan descriptions to ensure that the documents require exhaustion for all types of claims for benefits." For a discussion of the ruling's implications for plan sponsors and fiduciaries, click here. (Proskauer Rose LLP)
Now Congress Wants to Exempt Itself
from Obamacare
"If Congress quietly wants to exempt itself from Obamacare, that's great-so long as it includes the rest of us in that midnight amendment." (story)
Nondiscrimination Rules an Elephant in the Room
As most employers worry about whether to "pay or play" as of 2014 and whether or not certain employees will need to be counted as full-time for health care reform purposes, there is an elephant in the room that is not yet getting enough notice. This elephant is the approaching nondiscrimination rules that apply to all health plans [whether fully insured or self-insured] that are not grandfathered." More at Employee Benefit News
Employer Sues Broker over Inadequate
Stop Loss Policy

A self-insured employer purchased a stop-loss policy with a $1 million lifetime maximum, even though its benefit plan provided unlimited coverage for in-network claims. When a participant incurred $2,800,000 in medical bills, the employer became financially responsible for the excess. The employer sued its broker and agent for failing to recommend a sufficient stop-loss policy. The lesson: be sure that all the provisions (e.g., coverage limits, exclusions, eligibility, and definitions) in the stop-loss policy are consistent with those in the plan of benefits. (Case Details)

1st HIPAA Settlement Involving Small Entity

The Hospice of North Idaho (HONI) has agreed to pay HHS $50,000 to settle violations HIPAA. This is the first settlement involving a breach of unsecured electronic PHI affecting fewer than 500 individuals.

An unencrypted laptop containing ePHI of 441 patients had been stolen in June 2010. HONI had not conducted a risk analysis to safeguard ePHI, nor did it have in place policies or procedures to address mobile device security as required by the HIPAA Security Rule.
"This action sends a strong message to the health care industry that, regardless of size, covered entities must take action and will be held accountable for safeguarding their patients' health information." said HHS Office for Civil Rights (OCR) Director Leon Rodriguez. "Encryption is an easy method for making lost information unusable, unreadable and undecipherable." For more, read the ERISA Wonk.
ERISA Trivia

Last month, we asked, "Prior to its name change in February 2003, the EBSA was known as the ????." Congratulations to Liss Thompson of Chattanooga, TN for providing the first correct answer, the "Pension and Welfare Benefits Administration." (PWBA).


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© 2017 ERISAPros, LLC, All rights reserved. Information on ERISAPros' website, its newsletter, “News & Views,” and its blog, “ERISA Wonk,” is published as a general informational source. Information and articles are general in nature and are not intended to constitute legal or tax advice in any particular matter. Blog posts and comments reflect the personal views of their respective authors - not those of ERISAPros. Transmission of this information does not create an attorney-client relationship. ERISAPros, LLC is not a law firm and is not giving legal or tax advice. It does not warrant and is not responsible for errors or omissions in the content on its website or in its newsletters. ERISA is a complicated and confusing law. Summary Plan Descriptions (SPDs), Wrap Plan Documents, and Form 5500s require review and updating by qualified ERISA compliance professionals.


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