Archives September 2014

On Sep. 15, 2014, in the United States Supreme Court, Blue Cross Blue Shield Association, et al. filed an Amici Curiae Brief in support of BCBSM, appealing a Sixth Circuit Court award of $6.1 million to a self-insured plan. The implications of this Supreme Court decision could potentially return billions of dollars to self-insured health plans across the nation.

In a new twist about a case we have written about before, Hi-Lex Controls v. BCBSM, the BCBS Association has enlisted the help of insurance industry associations America’s Health Insurance Plans (AHIP) and Pharmaceutical Care Management Association (PCMA) in petitioning the US Supreme Court to overturn the lower court’s ruling that the insurer allegedly perpetrated fraud against its customers for nearly 20 years, namely for violating ERISA’s prohibition against self-dealing and breaching its fiduciary duties as well as engaging in fraud and concealment to hide its violations from plaintiffs.

If the Supreme Court upholds the Sixth Circuit decision of $6.1 million award for just one self-insured plan, the immediate impact could be billions of dollars for all self-insured ERISA health plans nationwide, as a result of the TPA industry’s potential recovery of a billion dollars in overpayment recoupments and anti-fraud campaigns over the past 10 years.

Avym Corporation announces new advanced ERISA Embezzlement Recovery Programs in preparation of the forth-coming Supreme Court decision, which will have a multi-billion dollar impact on self-insured health plans nationwide.  Specifically the advanced programs will examine the following issues: (1) determine if any TPA overpayment recoupments and offsets, which are in the billions of dollars nationwide, are ERISA plan assets, (2) ensure all TPA’s properly refunded ERISA plan assets as ERISA prohibits all self-dealings, (3) communicate and clarify self-insured plan administrator’s potential liability for fiduciary breach in failing to safeguard or recover plan assets.

These groundbreaking TPA/ASO auditing programs are unique and unlike any other traditional self-insured health plan overpayment auditing programs and are designed to identify and recover alleged overpayments that have been recouped by the TPAs –but have not been disclosed, restored or refunded to the ERISA self-insured plan assets as required under ERISA statutes and fiduciary responsibilities.  All self-insured health plans and TPAs should monitor this extremely critical Supreme Court decision on the BCBS appeals, in view of the fact that almost every TPA for self-insured health plans has engaged in successful overpayment recoupment and offsetting from healthcare providers in today’s multibillion-dollar overpayment recovery and offset industry.

For over 6 years, Avym Corp. has advocated for ERISA plan assets audit and embezzlement recovery education and consulting. Now with the Supreme Court’s guidance on ERISA anti-fraud protection, we are ready to assist all self-insured plans recover billions of dollars on behalf of hard-working Americans.

On May 14, 2014, in Hi-Lex Controls, Inc. v. Blue Cross Blue Shield of Michigan, 2014 WL 1910554, a federal appeals court (Sixth Cir. 2014) upheld a district court’s $6.1 million decision for Hi-Lex, a self-insured ERISA plan against BCBSM for violating ERISA in prohibited transactions and fiduciary fraud. Sixth Cir. concludes that (1) BCBSM served as a fiduciary for self-insured because it held or controlled plan assets and exercised authority over covered assets; (2) the Hi-Lex complaint was not time-barred because BCBSM’s actions triggered ERISA six-year fraud and concealment statute of limitations; and (3) BCBSM’s use of fees by self-paying it discretionarily charged for its own account is exactly the sort of self-dealing that ERISA prohibits fiduciaries from engaging in, according to the court document. (Sixth Circuit, Case Nos.: (13-1773, 13-1859), Decision Date: May 14, 2014).

The district court awarded Hi-Lex over $5 million in damages and prejudgment interest of almost $914,241. According to Hi-Lex’s allegations, BCBSM misrepresented and intentionally concealed these additional fees in contract documents and assured Hi-Lex that no fees were charged other than the administrative fee. Upon learning about the additional fees, Hi-Lex sued, claiming that BSBSM violated ERISA by engaging in self-dealing, according to the court document. (Sixth Circuit, Case Nos.: (13-1773, 13-1859), Decision Date: May 14, 2014).

In the Supreme Court, on Aug 12, 2014, BCBSM filed a Petition for a writ of certiorari, asking the high court to reverse a Sixth Circuit Court decision upholding a district court award of $6.1 million for a self-insured plan for fiduciary breach and ERISA fraud in concealing hidden fees as a TPA to Hi-Lex, a self-insured plan.

On Sep 15, 2014, an Amici Curiae Brief in support of BCBSM was filed by Blue Cross Blue Shield Association, America’s Health Insurance Plans, and Pharmaceutical Care Management Association, arguing “(I) the court of appeals’ decision creates uncertainty about when a third-party administrator is exercising control over plan assets”, and “(II) the court of appeals has created the specter that all third-party administrators could be deemed ERISA fiduciaries”, according to the court document.

BCBSA et al specifically argued: “In short, the determination as to whether an entity is an ERISA fiduciary is an important question with far-reaching ramifications that, in the context of the Sixth Circuit’s incorrect and aberrational decision, warrants this Court’s review. Review of that decision would ensure that the decision does not result in an ill-considered expansion of fiduciary litigation and liability for potentially thousands of ERISA plans covering millions of participants and billions in plan assets.” according to the court document. (Supreme Court Case No. 14-168, Title: Blue Cross Blue Shield of Michigan, Petitioner v. Hi-Lex Controls, Inc., et al., Docketed: Sep 15, 2014).

To find out more about Avym’s Overpayment Recoupment and Embezzlement Recovery Services or to contact us about educational programs please click here.  To Sign up for our newsletter and become an Avym Insider please click here.

On September 3, 2014, a California federal judge ruled in favor of a Los Angeles surgical center by dismissing with prejudice, Cigna’s overpayment lawsuit against La Peer Surgery Center after Cigna administered self-insured plans were counter-sued by the surgical center.  The dismissal came in spite of the fact Cigna prevailed over the provider’s motion to dismiss.

Cigna initially sued the surgical center in March 2013 for allegedly waiving collection of patient deductibles and co-insurance.  The court’s decision represents another surprising resolution to the escalating payor-provider court battles over payor overpayment claims for provider deductible waivers and also punctuated a speedy and effective resolution as the dismissal came less than 30 days after Lapeer’s counter claim against Cigna and many of the Cigna administered self-insured plans.  Surgery centers nationwide dealing with inappropriate overpayment demands and unauthorized payment offsets or recoupments should understand the importance of this case

The case is Cigna. v. La Peer Surgery Center, case number 2:13-cv-03726, in the U.S. District Court for the Central District of California.

On January 17, 2014, La Peer filed a motion to dismiss the amended complaint, arguing that because Cigna only administers the claims for the ERISA-governed plans: 1.Cigna did not use its own money to pay La Peer and is not seeking damages for itself, 2. Cigna must be a fiduciary to have standing under ERISA, a standard La Peer contends Cigna can’t meet.

On March 10, 2014, after a minutes-long hearing in Los Angeles, U.S. District Judge Christina A. Snyder issued a tentative ruling dismissing Cigna’s suit with leave to amend, saying Cigna couldn’t sue as a fiduciary of the health benefit plans because it was not in fact a fiduciary.

On August 7, 2014, following the filing of the amended complaint by Cigna, La Peer filed a counterclaim against CIGNA and many of the Cigna administered self-insured pans that were identified. The La Peer counterclaim against Cigna and the self-insured plans alleged Breach of Fiduciary Duty under 29 U.S.C.§1132(a)(2), seeking for Recovery of Benefits under 29 U.S.C. §1132(a)(1)(B) and Productions of Documents and Penalties under 29 U.S.C.§§ 1024(b), 1133(2), and 1132(c)(1) among other claims.

Among the self-insured plans countersued by La Peer were: A&E Television Networks, Akin Gump Strauss Hauer and Feld, AFTRA Health Plan, Anschutz Entertainment Group, Automobile Club of Southern California, Avnet, Inc., CBRE Services Inc., colony Advisors, LLC, Cornerstone OnDemand, Inc., David M. Lewis Company, LLC, Equity-League Health Trust Fund, Elliott Management Corporation, Forest City Enterprises, Inc., Hillstone Restaurant Group, Inc., Horizon Media, Inc., Jeffer, Mangels, Butler and Mitchell, LLP, Maritz Holdings, Inc., Marriot International, Inc., Morgan Stanley, NetApp, Inc., Newmont USA Limited, Omnicom Group, Inc., Orrick, Herrington & Sutcliffe, LLP, Pillsbury Winthrop Shaw Pittman, LLP, Richemont North America, Sullivan & Cromwell, LLP, The Walt Disney Company, Vubiquity Entertainment Corporation, William Morris Endeavor Entertainment, LLC, XL Reinsurance America, Inc. and Xceed Financial Credit Union.

On August 22, 2014 Judge R. Gary Klausner denied Cigna’s request for an extension to respond to La Peer’s counterclaim.  On September 3, 2014 Less than 30 days after La Peer’s counterclaim, the court dismissed Cigna’s case in its entirety with prejudice.

In response to the dismissal of Cigna’s case against La Peer, Avym Corporation announces new webinars devised to examine the implications of this case to Out of Network providers and facilities everywhere.  These webinars are designed to educate Out of Network providers and facilities in dealing with nationwide overpayment recoupment and offsetting practices by almost every insurance company and health plan, leaving many American workers and their families as well as their health care providers no protections as afforded under federal law ERISA.

Avym announces new webinars and advanced ERISA claim specialist programs in order to:

• Demystify the profound impact of this court decision regarding the nation’s No. 1 health care claim denial – overpayment demand recoupment and offsetting;
• Correctly appeal every inappropriate overpayment demand and subsequent claims offsetting with a valid ERISA assignment and the first ERISA permanent injunction;
• Provide proper litigation support against all unauthorized and inappropriate overpayment recoupments and offsets, to seek for enforcement and compliance with ERISA & PPACA claim regulations;

Avym is headquartered in in Los Angeles, CA and is the leading provider of ERISA/PPACA health claim appeal services, reimbursement compliance, dead claims recovery services and ERISA/PPACA healthcare claim litigation support services.  To get more information or to contact Avym, click here.