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 October 2011 Newsletter |
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 "After five years of business with you, you are still visiting us and taking care of our needs. It is unusual to see such young entrepreneurs with the passion and commitment you both have to sincere appreciation for your customers and this business. Shelly Lampard, VP of Life and Health Operations Gilsbar |
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Dear Reader,
The temperature and leaves are beginning to fall here in Boston as the long cold winter awaits. What a wild month it has been since we last communicated. From the NAIC's scathing report on stop loss to the mini-SPD requirements to the latest challenges to health care reform, who knows what the next few months will bring.
This month's newsletter is jam packed with information as we have been extremely busy keeping up with the latest changes and also creating innovative products to better serve the self funded community as a whole. My trips are slowing down, allowing me to spend more time at the office to the delight of my staff - I'm not too sure they share my sentiment! We here at The Phia Group are committed to reduce the cost of health care so I am always looking for your suggestions. Happy reading!
Adam V. Russo, Esq. CEO |
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Passion for Subro Blog - What's New?
To get all the latest industry news, don't forget to visit www.passionforsubro.com. Check out the link below to see a recently posted article.
The Medical Insurance and Stop Loss Cliff-Edge Dilemma - Solving It with New Age Reinsurance
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Letter from the Editor
To say that this month has been a busy one, would be an understatement. I am sure that with renewal season, many of you feel the same way.
While I have not been dealing with renewals, I have had the pleasure of traveling around the country to attend conferences for the self funded industry.
Most recently, I attended SIIA's National Conference in Phoenix, Arizona with Adam Russo, Ron Peck and Mike Branco. It was a wonderful event and I was proud to see our organization represented during multiple speaking engagements.
If there was one thing that I can say I took away from Phoenix, it was that Administrators are starting to become more confident making "risky" strides towards a future with PPO Alternatives and other cost containment measures.
One year ago today, many new ideas where just that. "Ideas". Today, I see an invigorated industry ready to meet challenges head-on and promote the overall growth and resiliency of the self-funded industry.
Happy Halloween!
Andrew Milesky
Director of Client Services
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Press Release - The Phia Group's Innovative Administrative Service Agreements (ASAs)
Ready For the Future of Self Funding!
Braintree, Massachusetts, 10/06/11 - The Phia Group, LLC is pleased to introduce ease and flexibility to its TPA clients, in contracting with their benefit plan clientele, through a series of new ASA templates.
Today, between new responsibilities imposed upon plan administrators and claims processors by the Patient Protection and Affordable Care Act ("PPACA"), and new attention being paid to fiduciary obligations, it is more important than ever before that ASAs be clear and set forth the respective rights and obligations of both the plan administrator and claims processor.
The Phia Group, LLC has invested considerable time this past year determining not only where the market is headed, but how the relationship between plan administrators and claims processors is evolving. This due diligence is reflected in our ASA templates. Our ASA is in full compliance with PPACA and in the event that additional legislation is created or modified, our attorneys can efficiently make any applicable revisions moving forward.
Read More |
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Press Release - Responding to the NAIC's Misconceptions Regarding Stop-Loss and Self-Insurance
Braintree, Massachusetts, October 7, 2011 - While considering changes to its model Stop-Loss Act, The National Association of Insurance Commissioners ("NAIC") was recently credited with comments that misclassify self-funded benefit plans as fully-funded policies of insurance, if and when they possess stop-loss protection. In short, it has been proposed that a self-funded benefit plan which carries stop-loss is no different than any other insured product.
The NAIC has requested formal comments regarding these substantive inaccuracies concerning this issue, and how employers may contribute to adverse selection in the fully-funded health insurance marketplace, if they should choose to organize self-funded benefit plans rather than join the forthcoming state-operated health insurance exchanges ("HIEs"). The Self-Insurance Institute of America, ("SIIA") has submitted a response that explains the misunderstanding, and sets the record straight. The Phia Group, LLC was proud to contribute to that effort. SIIA's response clearly outlines in detail the issues and misconceptions and more importantly, the industry's response.
Read More
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Press Release - New Fees on the Horizon for Group Health Plans
Braintree, Massachusetts, October 7, 2011 - The IRS recently published preliminary guidelines regarding the implementation of certain provisions included in the Patient Protection and Affordable Care Act (ACA). Specifically, the ACA will require fees to be imposed on both fully and self insured health plans to help fund comparative clinical effectiveness research relating to patient-centered outcomes. The ACA creates a nonprofit corporation, the Patient-Centered Outcomes Research Institute, to conduct and promote clinical effectiveness research. The Phia Group, LLC reviewed IRS Notice 2011-35 and has outlined the pertinent provisions and our concerns below.
In particular, the ACA imposes fees on "specified health insurance policies" and "applicable self-insured health plans" based on the average number of lives covered under the policy or plan. The fees are effective for plan years ending after September 30, 2012. As a result, employer sponsored plans that begin on the first of the month; the first plan year subject to the fees will be plan years beginning November 1, 2011. The fee no longer applies for plan years ending after September 30, 2019. The fee is $1.00 per year, multiplied by the average number of lives covered under the plan for plan years ending before October 1, 2013, and $2.00 per year for plan years ending after that date. Beginning in 2014 the fee will be adjusted based on a formula that takes into account the increase in national health care expenditures. Covered employees, spouses, and dependents will be included in the total number of covered lives. The fee applies to "specified health insurance policies" which include self-funded plans. A self funded plan is defined as any accident or health insurance policy (including a policy under a group health plan) issued with respect to individuals residing in the United States. The fee does not apply to plans that are treated as excepted benefits under HIPAA such as limited scope dental and vision plans. For fully insured plans, the fee will be paid by the health insurance carrier. The fee for self-funded plans must be paid by the plan sponsor. Pending further guidance by the Internal Revenue Service, there are, however, several issues that need to be clarified regarding the implementation of this fee including but not limited to:
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SIIA White Paper - Self-Insured Group Health Plans, Stop-Loss Insurance and Adverse Selection
with contributions by:
Adam Russo Esq. and Ron E. Peck Esq.
Introduction
In the course of considering changes to its Stop-Loss Model Act, the National Association of Insurance Commissioners (NAIC) has received formal comments containing substantive inaccuracies regarding self-insured group health plans, stop-loss insurance, and how smaller self-insured group health plans may contribute to adverse selection in the health insurance marketplace. Similar comments have been made by federal regulators responsible for implementing the Affordable Care Act (ACA).
This White Paper identifies and corrects several inaccurate comments in order to assist policy-makers at both the state and federal level to properly assess legislative/regulatory proposals related to self-insured group health plans.
Read More
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Client Spotlight - Gilsbar
This month The Phia Group would like to dedicate its spotlight to Gilsbar. The Louisiana based TPA was an early Phia Group client, and one that truly helped put us "on the map". There is not a day that goes by that we do not remember those that have given us the shot to be the industry leader we are today. Gilsbar is no exception.
Company Overview
Gilsbar is one of the nation's largest and fastest growing privately held health and benefits management organizations. Even in the face of challenging economic times, Gilsbar has experienced organic growth of 27% over the past three years. We attribute this success to our unwavering drive to execute our corporate vision and strategy.
Our expertise in the insurance and benefits administration markets has helped make Gilsbar the trusted choice for clients across the nation. Employers, brokers and consultants, affinity groups, insurance carriers and professionals rely on us. They cite our innovation, ingenuity, knowledge and excellent service as the reasons they chose us and continue to stay with us through the years.
Philosophy
We believe in doing the right thing by those we serve. We invest in great people - thought leaders. We approach each client proactively, with ingenuity and foresight, and with a long-term view. We build partnerships that go beyond mere business transactions.
Where We Started
In 1959, Henry Miltenberger started the company with a partnership with the Louisiana State Bar Association that gave Gilsbar its name - Group Insurance Louisiana State Bar. This partnership launched a national insurance services provider with over 300 employees and an insurance administration strategy that is resonating throughout the country. We are honored to continue to serve our very first customer, the LSBA, as well as many other distinguished partners, employers, brokers and consultants, affinity groups, insurance carriers and individuals.
www.gilsbar.com
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Summary of Benefits Coverage
Many of our clients are asking us about the Summary of Benefits Coverage ("SBC") that is required by the Patient Protection and Affordable Care Act (PPACA) to be distributed to new and current plan enrollees beginning March 23, 2012. This document should not be confused with the SPD or SMM, as this SBC is a new, separate notice that both grandfathered and non-grandfathered plans must provide. The SBC will provide a summary and explanation of benefits and coverage provided under a group health plan.
The U.S. Department of Labor and the Department of Health and Human Services have adopted the template created by the National Association of Insurance Commissioners (NAIC) in its entirety. Each plan must complete a separate SBC for each type of plan (high deductible, PPO, cost plus, etc.) as well as for each coverage type (family, individual, etc.).
The Phia Group developed a Summary of Benefits checklist for plans that corresponds to NAIC's template. To test drive our checklist and the template, our legal team tried to create a SBC for our self-funded plan. In doing so, we had lots of questions for our TPA and we were unable to fill out the coverage examples (pregnancy, diabetes, cancer) because DOL/HHS has yet to issue standardized data for plans to use in calculating participant costs.
The Phia Group is in the process of filing comments with the DOL and HHS because their SBC template is not geared toward the self-funded industry and may confuse participants, plans, and TPAs. The language, color, organization and font of the template cannot be altered, and the government mandates the use of certain terminology and phrases. For example, the word "premium" is used on the first page of the template instead of "contribution"; the appeals language on page 4 is not applicable to self-funded plans; and some of the bullets underneath "Your Rights to Continue Coverage" on page 4 are not be relevant to self-funded plans, such as "the insurer stops offering services in the state".
At this time, there is not enough information for plans to create a SBC. The federal government must issue additional regulations to explain the SBC. Until this happens, look to The Phia Group as your resource for questions regarding the Summary of Benefits Coverage.
Stay tuned for more information on The Phia Group's future service offering - drafting Summary of Benefits Coverage documents.
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Case of the Month
In this case, the dependent was involved in a single motor vehicle rollover accident. Total charges exceed $600,000 dollars. These claims were all being denied by the plan for accident details.
The case was sent to The Phia Group to investigate the dependents first party coverage and obtain copies of the police report.
The Phia Group's Claims Recovery Specialist immediately contacted the auto insurance carrier and verified that the $10,000 in Personal Injury Protection (PIP) had been exhausted. This was confirmed in writing and evidence was provided to the plan. At this point the specialist was just waiting on the police report.
Once received, it was discovered that the patient had been charged with reckless driving and that they had been intoxicated so there was an additional charge of Driving Under the Influence (DUI).
The specialist had already reviewed the plan language to check for the presence of an illegal acts or alcohol exclusion. In this case, there was an alcohol exclusion. This claim was applicable and the plan was able to deny the claims fairly.
This is yet another case hilighting the advantages of having strong plan language and how it can create savings by avoiding unnecessary costs. |
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Consulting Case of the Month
While considering changes to its model Stop-Loss Act, The National Association of Insurance Commissioners ("NAIC") was recently credited with comments that misclassify self-funded benefit plans as fully-funded policies of insurance, if and when they possess stop-loss protection. The Phia Group, LLC was asked by the Self Insured Institute of America ( "SIIA") to assist in drafting a response to set the record straight. SIIA's response clearly outlines in detail the issues and misconceptions and more importantly, the industry's response
Phia in conjunction with SIIA, identified several significant misconceptions. The industry's response reflected an intent to create a better understanding of the mechanics of self-funding and stop-loss insurance. To start, employers who purchase stop-loss coverage with low attachment points are not fully insured. A self-funded employer that funds its own health plan retains all the risk and liability; the self-funded plan is financially obligated to compensate healthcare service providers and plan participants. The availability (or lack thereof) of stop-loss coverage does not in any way reduce or mitigate any of the risk that the self-funded employer has agreed to assume. Put simply, stop-loss coverage is a product that provides a reimbursement mechanism for expenditures in excess of defined limits or expectations; it is not health insurance.
In short, in today's rapidly evolving health care marketplace, information that is reliable, clear and concise is something worth investing in. The Phia Group, LLC provides consulting services to the self funded industry regarding a wide array of topics.
If you have any questions, or would like to discuss this further, please contact Andrew Milesky at 781-535-3636 or via email at amilesky@phiagroup.com
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Department of the Month - Phia Group Consulting ("PGC")
As the laws affecting plan rights have changed, The Phia Group's services have evolved to include specialized cost containment solutions and ensuring claim cost efficiencies. As The Phia Group expands its service offerings, its mission to reduce the cost of clients' health benefit plans through innovative technology, legal expertise, and personalized service remains unrivaled.
Administrative Services Agreement Review
An administrative services agreement (ASA) that appropriately sets forth the obligations and responsibilities of both a Third Party Administrator and Plan Administrator is crucial. To avoid conflicts, the ASA must be drafted so that administrative tasks are clearly delineated. We can review your existing ASAs and identify potential pitfalls and provisions requiring immediate attention. In addition, we can draft a custom ASA designed to meet the needs of each client.
Third Party Agreement Review
Plans must obey the terms of the plan document and may not agree to step beyond the boundaries set by those provisions. Yet many third party entities expect Plan Administrators to exceed their fiduciary duties on a regular basis.
PPO Agreement Review
With respect to our PPO Agreement Review service, our attorneys will:
- Ensure the terms do not contradict plan terms;
- Provide an analysis identifying areas of concern or potential conflict;
At the option of the client, make "red-line" contractual language suggestions; and
- Assist with the drafting of customized language.
Stop Loss Agreement Review
With respect to our Stop Loss Agreement Review service, our attorneys will:
- Ensure the terms do not contradict with the plan terms;
- Provide an analysis identifying areas of concern or potential conflict;
- At the option of the client, make "red-line" contractual language suggestions; and
- Assist with the drafting of customized language.
Gap Free™ Review
The Phia Group can review available template documents (the plan document, stop loss agreement, and PPO agreement) to identify potential gaps in coverage. We can compare the documents to issues typically arising with respect to the interplay between each of the documents, assisting in the identification of coverage gaps.
Balance Billing and Medical Bill Review Consultation
Balance billing has become more prominent in recent years. Balance billing occurs when hospitals, clinics, doctor's offices and other medical facilities bill patients for the balance between what they want to charge for services and what the plan has already reimbursed. Some States have enacted laws prohibiting this practice (in certain circumstances). As it relates to this practice, our attorneys will assist clients in third party negotiations to minimize conflicts.
Read More
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Spotlight Employee of the Month - Jennifer Bryer
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Jennifer Bryer, Esq.. |
Jennifer joined The Phia Group as an attorney in June. She currently handles subrogation files, drafts plan documents, and works with clients to resolve their questions regarding health care reform and general employee benefits matters. Jennifer also taught a "Phia University" class on negotiation techniques, wrote a paper about on-site employer medical clinics, and assisted in updating our internal claims and external appeals template language.
Jennifer received her J.D. and M.B.A. from Suffolk University and received her undergraduate degree in criminal justice from Northeastern University.
Jennifer has always been active in her community, whether volunteering at Rosie's Place (a homeless shelter), reading to kindergarteners, or taking on legal pro bono matters. In her spare time, Jennifer enjoys knitting and spending time with her husband and family. She also enjoys staying active, whether it is through kickboxing, lifting weights, or yoga.
The Phia Group is excited to have Jennifer as the newest member of our legal team, and can't wait to watch her blossom into a self-funding expert.
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FREE WEBINARS
 "Selecting Benefit Plan Services, and Service Providers"
Join us October 26, 2011
1 - 2PM EST
Join The Phia Group on October 26, 2011, as we discuss what to look for when you are considering using these organizations to address your needs. We will take a look back at the many relationships we've seen our clients develop with service providers, and present our audience with a best practices approach to finding the right vendor.
To view all our past webinars click here.
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Where in the World is Phia?
 Do you have a picture of yourself, or someone else representing The Phia Group in a fun or exotic place? If so, submit your photo to info@phiagroup.com, and you may be selected as our quarterly prize winner! |
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Presentations
To view The Phia Group's past presentations click here.
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The Phia Group's Services
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Stay Connected With Us on the Web!
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©2000-2011, The Phia Group, LLC | 163 Bay State Drive Braintree, MA 02184 | Phone: 781-535-5600 | Fax: 781-535-5656 |
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