"Several years ago DGB partnered with the PHIA Group to handle our subrogation business. We quickly learned that the PHIA Group not only had a "Passion for Subro" but a passion for our industry. We rely heavily on their experience, drive and their ability to service our TPA and clients. As Health Reform and State Regulation continue to evolve, we will be relying heavily on PHIA to assist us in navigating these changes and how the will impact our business.
It is very rewarding to work with a company that has such a great vision and can deliver the old fashion service we all appreciate."
Executive Vice President
Diversified Group Brokerage
Well, it's that time of year where here in New England the leaves are turning colors, the summer outdoor furniture is being put away, and by the time I leave the office its already dark outside. So depressing, yet I feel so inspired by what I see happening across the industry. People are getting creative with their cost containment ideas and I see more and more innovative approaches to reducing the cost of health care. But we have to be diligent in how we do these things.
Too many of us in our industry have great intentions but are not putting in the preparation needed. We here at The Phia Group can ensure your programs are solid before you move ahead. I'm excited for this 4th quarter and working with you to close the year on a positive note. We are changing - just like those leaves.
Finally, the Browns won a game - another reason for optimism. Happy Reading.
Adam V. Russo, Esq.
Passion for Subro Blog
Our Blog is currently under construction to make it better than ever. We will let you all know as soon as its unveiled.
We are very excited to get your feedback.
Letter from Editor
by Andrew Milesky
I love the fall. I can honestly say that I've been all around this country from corner to corner, but there isn't much that beats Autumn in New England.
I don't know about you, but I am a HUGE fan of Halloween. I love scary movies, pumpkins and of course Halloween parties! I would share a picture of me as a zombie, but I am afraid it may scare away some of our readers...
One of things that is not scaring our readers is talking about and or implementing PPO Alternatives into their benefit plans. I can not remember a time when so many people are truly looking to move forward with these initiatives. A year or two ago it was a pipe dream. Now it seems to be moving full steam ahead.
These are exciting times and I think the industry moving forward and finding new ways to be innovative is just what is needed. The looming election has many people excited over what it could mean for the future of healthcare. The truth is, no matter what the outcome, much of what we are dealing with will stick around. I am happy to see our clients embracing the change and finding ways to make the best out of the circumstances.
Director of Client ServicesAndrew Milesky
PGC Legal Issue of the Month
by Chris Aguiar
The world of subrogation has been in somewhat of a state of flux since the 3rd and 9th Circuits seemingly forced equitable limitations back into the discussion of an ERISA Plan's right of full recovery. Last month we discussed a case that went back to the basics and affirmed some fundamental principles brought forth in the Knudson and Sereboff decisions. This month, we highlight a case where a court discussed equitable principles, but failed to adopt their application, and in fact, re-established some limitations on a member's ability to force a Plan's hand into litigation.
In K-VA-T Food Stores, Inc. v. Hutchins, 2012 U.S. Dist. LEXIS 26575, the Plan participant went to great lengths to avoid reimbursing the Plan. In response to the Plan's request, the participant responded by letter advising that he had instructed his attorney not to withhold or pay any monies to any party who may have paid medical bills on his behalf. He also instructed his attorney to ignore inquiries pertaining to the amount of any settlement and/or judgment. He even went as far as to advise the Plan that it could feel free to file any action it deemed appropriate.
The Plan, having paid $191,948.85 in medical bills on behalf of the Plan participant opted to file an action for a declaratory judgment. The Plan was then forced to intervene in the plan participant's state action, because the plan participant obtained a settlement of $850,000.00, to obtain an order that its lien would be held pending the resolution of the previously filed declaratory action.
The Plan was then granted summary judgment and both the plan participant and the Plan filed motions for attorney's fees. The Plan language clearly allowed the plan to obtain full reimbursement of the medical expenses paid regardless of any fee claimed by the Plan participant's attorney.
Ultimately, the court granted the plan's motion for attorney's fees. It was very interesting to see how the court reasoned its decision and how it handled the recent 3rd Circuit precedent of U.S. Airways v. McCutcheon.
In holding for the Plan, the court suggested that while it is possible that equitable principles may have been considered, this situation would not have had the "starkly inequitable result of the injured beneficiary not recovering anything as a result of his injuries, and in fact being further indebted to his own attorneys for legal fees, putting him in a worse position than if he had not pursued a third party recovery at all" as we saw in U.S. Airways v. McCutcheon. The Court, however, recognized that the plan participant in this case would obtain a significant award even after reimbursing the Plan in full. The court also opined that under the facts of this case, it would be inequitable to award Hutchins' attorney's fees under a common fund theory because he fought the plan's rights every step of the way without any apparent basis for such resistance. His improper handling of the matter forced the plan to intervene and therefore becomes a factor in the decision of whether to award attorney's fees. When considering that his award was sufficient so that he could easily satisfy an award in favor of the Plan of attorney's fees, as well as several other factors, the Court found the Plan's request reasonable.
This case is helpful for many reasons. First, it shows us that even if courts apply equitable principles, they will often do so with some discretion. In this case, not only did the court recognize that a Plan can succeed in its request for attorney's fees if it has appropriate language, it also noted that even without language, it is within a court's discretion under ERISA to award attorneys fees and costs to a prevailing party in ERISA litigation. Further, it shows us that court are willing to sanction a plan participant who refuses to cooperate with the Plan without an appropriate basis to do so and will not blindly impose equitable limitations on the rights of ERISA Plans.
These are all very positive signs, albeit from Circuits that are historically favorable to Plan rights, as we await the Supreme Court's involvement in the debate over equitable limitations.
Client Spotlight - Diversified Group Brokerage
This month, we would like to place a spotlight on Diversified Group Brokerage out of Marlborough, Connecticut.
DGB has been a client of The Phia Group since 2008. For the last 4 years we have enjoyed a successful and innovative partnership and even greater friendship. Thank you Brooks, Charlie and Dave for years of innovative ideas and excellence.
A Little About DGB
Diversified Group Brokerage was built on the premise that self-funded insurance plans are the most cost effective and sensible health insurance options for many companies across the country.
Diversified's family of companies have been administering self-insured health plans for groups and unions for over 40 years. Our tenure as a third party administrator has allowed Diversified to bring our clients the most comprehensive and cost effective approaches to healthcare. If your company is looking for a third party administrator that considers customer service, dedication, innovation and experience to be the most important aspects of providing a quality health-plan, then you've come to the right place!
For more information on DGB, please visit:
Recovery Case of the Month
by Katie Dever
The Phia Group received a stop loss recovery case involving an Arizona employee health plan participant. Being that Arizona is an anti-subrogation state which bars a health plan from enforcing the terms of its subrogation and reimbursement provisions, The Phia Group first established that the Plan was classified as a political subdivision of the state, therefore making it exempt from Arizona's anti-subrogation rule. We proceeded with pursuing reimbursement.
The Phia Group represented the stop loss carrier only and after establishing that the patient was injured as the result of a motor vehicle accident, we placed the TPA's subrogation vendor on notice of stop loss' right of reimbursement. Stop loss has reimbursed over $207,000.00 to the plan.
When checking the status several months later, the subrogation vendor advised that settlement had been reached and reimbursement sent to the plan in the amount of roughly $275,000.00. We were redirected to the plan for reimbursement. Upon contacting the plan, we were presented with much hesitation. The plan argued against fully reimbursing stop loss due to the expenses it incurred during the recovery process. The Phia Group reviewed the terms of the stop loss contract finding that it did state it "may reduce" its interest by the expenses incurred by the plan during the recovery process. We requested the expense documentation from the plan.
Once this documentation was obtained, we presented our client with the details necessary for it to consider a reduction of its interest. Our client agreed upon a 25% reduction of its interest. The Phia Group received reimbursement totaling roughly $155,000.00. This case reflects the importance of staying trust to your contract/plan language. An amicable agreement is always more beneficial and less costly to the client!
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.
The Phia Group offers specialized cost containment solutions and consults on best practices. From dispute resolution to general consultation, our legal team provides invaluable services in response to the industry's most pressing needs.
Third Party Agreement Review & Revision - Review agreements to reveal conflicts, as well as provide revised terms.
- Stop Loss Contracts - Review both the applicable stop-loss policy and plan document to identify gaps in coverage
- PPO Contracts - Identify issues and consult on solutions
- ASA Agreements - Review or draft Administrative Services Agreements, as well as provide our own template
Dispute Resolution - Assist with grievances and manage conflicts
- Combat Balance Billing - Support negotiation efforts, minimize conflicts, and cease balance billing by service providers
- Defend Claims Processing - Assist in the enforcement of plan terms and defend adverse benefit determinations
- Resolve Stop Loss Disputes - Obtain facts and ensure excess coverage issues are resolved efficiently and effectively
General Healthcare Consulting - Quickly assess clients' needs, recommend options, and develop customized solutions.
The Phia Group in the Community
Greater Boston Food Bank Volunteer Day 2012
As an annual tradition, The Phia Group dedicates at least one day per year, where we close our office completely and participate in a charitable event. This July, our staff spent the day at The Greater Boston Food Bank, where we sorted and organized food for distribution, as well as made a donation from our entire team.
The Greater Boston Food Bank provided us with statistics based on our days work:
Total pounds of food sorted: 12,574
- Total pounds of food salvaged: 10,059
- Pounds of food sorted per Volunteer: 173
Total Meals made possible: 7,714
- Meals made possible per volunteer: 133
We are very proud of our staff's accomplsihment and vow to continue to donate our time each year to making a difference in the community.
If you are interested in learning more or donating to the Greater Boston Food Bank please click here.
Employee Spotlight of the Month - Ulyana Bevilacqua
This month, we would like to place a spotlight on our Employee of the Quarter winner, Ulyana Bevilacqua.
Ulyana has been with The Phia Group since May 16, 2012 - and in such a short time she has made a world of difference here.
Ulyana is a member of our Phia Group Consulting Team and specializes in the creation of the Summary of Benefits and Coverage ("SBCs").
A native from Samara, Russia, Ulyana came to America in August 2008 after graduating from Samara State Pedagogical University with a focus in teaching foreign languages.
In addition to being an active member of the "PGC" team, Ulyana teaches Russian at the Boston Language Institute .
In her spare time, Ulyana enjoys reading, exercising and spending time with her son, Daniel and her husband Michael.
Ulyana has quickly become an asset to our company and we truly hope she makes Phia home for the foreseeable future.
Our next webinar will be October 17, 2012 @ 1pm EST
"Trick or Treat? The Pros and Cons of Today's Most Trendy Cost Containment Schemes"
To register, click HERE!
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, please submit your photo to firstname.lastname@example.org , and you may be selected as our quarterly prize winner!
To view any of our past presentation, please click here
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