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.



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