The HHS' and DOL's VIEW on Self-Funding

The Self-Insurer - September 2011

By Adam Russo

Unless you have been living under a rock, you know that the Patient Protection and Affordable care Act ("PPACA") required the Department of labor ("DOL") and the Department of Health and Human Services ("HHS") to create an annual report for congress that compares self-funded and fully-insured plans. After reviewing both reports in detail, I can say with confidence that every single TPA in the country should have a copy of each in their sales and marketing departments, highlighting the essential findings for prospective clients. Surprisingly, these studies can be used as an important tool in the arsenal of any TPA looking to expand its business. You should be sharing this information with every broker and agent in your area.

While states have been able to control insurance carriers through regulations, they have had much less success with the self funded world; but you have to give them credit for their continuous efforts! The report makes it pretty clear what the federal government has in store for us and how they may be able to gain more control over our little self funded world.

In my opinion, it is well worth your time to read the HHS and DOL reports as the studies include many interesting statistics regarding the demographics of self funded employers, the industries they are in and the shift towards self-funding over the years. In addition, there are many great statistics that may surprise even the experts amongst our readers. Or, if you prefer to be lazy and enjoy these fleeting sunny summer days, I have outlined important highlights from the studies for your easy reading pleasure!

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Department of the Month - Overpayment

Overpayments happen. If a provider bills twice for the same service or overcharges for a visit or procedure, an overpayment occurs. When an ineligible claim is paid because facts indicating the application of an exclusion come to light after payment is made, an overpayment occurs. If a claim is paid, which has already been paid by a responsible third party or other carrier, such as automotive or home insurance, an overpayment occurs.

The Phia Group realizes that your claims administrators often do not have the time or resources to follow up on overpayment recovery opportunities that come to their attention in day-to-day operations. Through an effective, efficient, and time proven approach, The Phia Group examines applicable laws, contacts providers, and maintains a legal method in recovering overpayments. Our recovery operations yield information and results that produce significant savings for our clients.

The Phia Group will accept individual case referrals, as well as identify cases in-house. Every case will be assigned to our Overpayment Recovery Department for handling. We contact the providers directly and request refunds in writing. Our correspondence is based upon the terms of the plan language and the applicable laws relating to overpayment recovery.

Our in-house attorneys also lend their expertise to the effort. Our attorneys ensure that your plan language not only allows our clients to recover overpaid claims, but also recoup funds paid for unreasonable charges made by providers. Indeed, there are many situations where payment of charges may be unreasonable and the applicable plan document may substantiate efforts to pursue a refund if claims are paid. We ensure that your rights are protected and refunds are successfully pursued.  

For additional information about The Phia Group's Overpayment Services, please contact Andrew Milesky by phone at 781-535-5636 or email at amilesky@phiagroup.com.

This month, The Phia Group would  like to place our spotlight on another one of our first clients, CBA Blue. Back in 2002, CBA Blue and EBPA began working with a young Phia Group. It is clients such as this that helped to make The Phia Group the organization that we are today.

Ms. Ball was a pedestrian involved in a hit and run accident on 11/08/10. Upon receipt of this file, we determined that Ms. Ball had filed an uninsured motorist (UM) claim with her own auto insurance carrier, Travelers. We placed the UM adjuster on notice of the Plan's right of reimbursement on January 5, 2011. In addition to the UM claim, Ms. Ball also carried a $5,000.00 Med Pay limit which was exhausted to her for out of pocket medical expenses.

The Phia Group then sent a subrogation/reimbursement agreement to the member which she signed and returned. This agreement was accompanied by a cover letter explaining that the Plan would seek reimbursement upon settlement of the UM claim with Travelers.

We then compiled a listing of claims paid by the Plan which totaled roughly $74,000.00, roughly $20,000.00 of which was reimbursed by Stop Loss. Luckily, the Duncan Enterprise Employee Benefit Plan adopted The Phia Group's plan language which fully protected the Plan's rights of reimbursement. This plan language was provided and referenced multiple times to both the adjuster and the member to ensure that all parties were privy to those rights.

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In recent years, Sean Hegarty served as Overpayment Recovery specialist, and was then promoted to Overpayment Department Manager for The Phia Group, In management capacities with the company, Sean oversaw operations, accounting, customer service and marketing. Through a successful 5-year tenure, he developed and implemented strategic business plans leading to substantial revenue and profit growth. Furthermore, Sean excelled in creating both the structure and team necessary to guide the Phia Group Overpayment Department's vision through the turbulence and uncertainty of the Healthcare Reform Act and the company's dramatic growth.

In addition to dedication and passion at the Phia Group, Sean is committed to his community and family. Throughout the years Sean has supported and local youth baseball,  Hockey and Soccer with coaching and mentoring efforts and he volunteers at the Greater Boston Food Bank in its efforts to distribute food and other necessities to the area underprivileged and needy.

Sean is a manager who empowers other to succeed. He works with talented and capable people, and provides the environment and motivation to help them excel. The Overpayment Department is passionate and focused on helping health plans, in any way possible, recover scarce dollars in such tough economic times.