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User:Christopherhamze/ERISA Reimbursement

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ERISA Reimbursement
        “ERISA Reimbursement” is the terminology utilized to describe an ERISA Plan’s effort to require that it be paid back for medical bills expended on behalf[1] of a Participant or Beneficiary[2] of the ERISA Plan. The concept of “reimbursement” can be traced to the traditional doctrine of “Subrogation,” but it exists today without the traditional safeguards established in the development of the law concerning subrogation. When an insurer pays a claim to an insured, the insurer generally has the right to “step in the shoes” of the insured for the purpose of recapturing that money by pursuing a claim against the tortfeasor who may be liable for the loss.[3] An ERISA plan’s “right of reimbursement” is essentially a subrogation claim. Although there are subtle legal distinctions between “subrogation” and “reimbursement,” these devices are essentially the same. Unfortunately, there is little or no oversight on the ability of ERISA Plans (and their insurers) to pursue reimbursement claims. Historically, subrogation actions were limited at common law to matters involving property damage claims, with subrogation on personal injury claims being specifically prohibited.[4] Authority for “ERISA reimbursement" claims is attributed to federal preemption under the auspices of ERISA which was enacted in 1974. At the time ERISA was enacted by Congress, however, subrogation for health insurers was uniformly prohibited in the United States. Such claims were deemed unlawful in all jurisdictions.
       The first reported judicial decision involving an effort of a health insurer to seek subrogation on a personal injury claim is the 1982 decision in Frost v. Porter Leasing Corp., 436 N.E.2d 387 (Mass. 1982) in which subrogation was denied. “ERISA reimbursement” claims began arising in the late 1980s and have been resisted by some federal courts.[5] The health insurance industry has taken advantage of federal preemption under ERISA to advance -- in an unchecked fashion -- its own interest over the interests of those who are insured. According to industry statistics, ERISA plans and related insurers are collecting close to $1 billion per year through the seizure of tort recoveries or other contractual payments received by insured personal injury victims.[6] The plans aggressively pursue reimbursement on a "first dollar priority" basis with no consideration of the impact reimbursement leaves upon the insured. Although proponents of ERISA Reimbursement argue that these recoveries flow to the benefit of other insureds, such has never been established.[7] In reality, these recoveries are treated as sources of profit for the insurers and those engaged in the collection business itself. The coveted status of federal preemption – i.e., complete freedom from governmental oversight -- in the matter of reimbursement is not only enjoyed by ERISA plans, but also by stop loss insurers and other related insurers doing business through ERISA plans. These insurers furtively mold their coverages and policy provisions to fall under federal preemption and then mandate "first dollar priority"on their self-granted reimbursement claims. There have been numerous cases where a “normal person” sustains catastrophic injuries resulting in permanent disability, quadriplegia, paraplegia, and/or permanent confinement in long term care facility and the plan has successfully sought repayment of the medical bills despite the fact there is no money remaining for injured beneficiary.[8] Plans have shown no hesitation in suing permanently disabled beneficiaries in an effort to seize the entire tort recovery intended for the beneficiary.[9]

Notable ERISA Reimbursement Experts

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Professor Roger Baron, an ERISA Subrogation and Reimbursement Expert, has been teaching at the University of South Dakota School of Law since 1990. He has become a recognized advocate for the rights of ERISA participants and beneficiaries in connection with the aggressive pursuit of ERISA reimbursement (subrogation) claims which came into vogue in the 1990s. ERISA reimbursement claims are filed by ERISA plans and their insurers, seeking a return of money spent on medical claims paid as part of health insurance coverage. These claims are pursued on a “first dollar priority” basis and often consume the all or most of tort recovery secured by the ERISA participant/beneficiary, leaving the person penniless[10]

Robert "Rob" Hoskins has been handling ERISA claims for almost as long as he has been practicing law. (He graduated from law school in 1989.) He handled his first ERISA case in 1991 and won his first "big" ERISA case in 1992. Since then, he has handled literally thousands of ERISA and insurance cases of about every type imaginable. He regularly handles ERISA and insurance claims involving long term disability, health insurance, life insurance, accidental death and pension/retirement matters. He has handled a number of notable ERISA and insurance cases before various courts including the United States Supreme Court. He has, also, written and lectured extensively on ERISA. He has, also, been recognized as one of the top ERISA and Employee Benefits lawyers in South Carolina the publication SuperLawyers. Finally, Mr. Hoskins is listed in the publication The Best Lawyers in America (2010) in the practice area "employee benefits". Mr. Hoskins also volunteers as an administrator for the popular ERISA website ERISABoard.com (which is viewable by registered attorneys only).[11]

References

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  1. ^ Roger M. Baron, Public Policy Considerations Warranting Denial of Reimbursement to ERISA Plans, 55 Mercer Law Review 595 (2004).
  2. ^ The term “participant” is defined in 29 U.S.C. 1002 (7) and generally encompasses employees and former employees. The term beneficiary” is defined in 29 U.S.C. 1002(8) as “a person designated by a participant or by the terms of an employee benefit plan, who is or may become entitled to benefit thereunder.”
  3. ^ Roger M. Baron, Subrogation: A Pandora's Box Awaiting Closure, 41 South Dakota Law Review 237, 238 (1996).
  4. ^ Roger M. Baron, Subrogation on Medical Expense Claims: The "Double Recovery" Myth and the Feasibility of Anti-Subrogation Laws, 96 Dickinson Law Review 581, 583, notes 11-12 and accompanying text (1992).
  5. ^ David M. Kono, Unraveling the Liningh of ERISA Health Insurer Pockets – A Vote for the National Federal Common Law Adoption of the Make Whole Doctrine, 2000 BYU L.Rev. 427 (2000). Roger M. Baron, Public Policy Considerations Warranting Denial of Reimbursement to ERISA Plans, 55 Mercer Law Review 595 (2004).
  6. ^ “One of the largest private healthcare claims recovery services in the United States recovered $239.9 million in health claims in 2003. See Trover Solutions, Inc., Form 10-K (FY 2003) at 29. Based on the recoveries made by this service, it is estimated that more than $1 billion is recovered annually on behalf of all plans.” 2006 WL 467695, at footnote 37, page 15. Quoted material is taken from Amicus Brief filed by the US Chamber of Commerce, found at in Sereboff v. Mid Atlantic Medical Services, Inc, 126 S.Ct. 1869, 74 USLW 4240, 164 L.Ed.2d 612, (May 15, 2006).
  7. ^ Roger M. Baron and Delia Druley, ERISA Reimbursement Proceeds: Where Does the Money Go? Minnesota Trial, Spring 2010, also published by North Dakota Association for Justice, South Dakota’s “The Barrister,” and Pennsylvania Association for Justice Newsletter May, 2010.
  8. ^ http://erisawithprofessorbaron.com/catastrophic-situations/
  9. ^ http://erisawithprofessorbaron.com/wp-content/uploads/Marilyn-Trefz-ERISA-article.pdf
  10. ^ www.erisawithprofessorbaron.com
  11. ^ http://www.fosterfoster.com/Bio/RobertHoskins.asp
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