NEW REGULATIONS PROVIDE MORE CLARITY FOR ERISA APPEALS

When appealing a claim denial from an ERISA health plan, it is important to determine the extent of the plan's chiropractic benefits as well as who made the decision to deny the claim and why, said Karen L. Handorf, deputy associate solicitor in the Plan Benefit Security Division of the U.S. Department of Labor (DOL). All of this information is available to patients, and doctors acting as patient representatives, under new DOL regulations. Employers with ERISA health plans are also obligated under the new rules to follow specific steps in the appeals process. Handorf, whose DOL division is responsible for providing litigation and advisory legal services under ERISA, participated in an Oct. 24 teleconference on new ERISA-related court rulings and Labor Department regulations hosted by ACA for chiropractic attorneys and state association representatives. She told the group that, at present, individual doctors and their patients are better off going through a plan's appeal procedure to obtain benefits rather than filing a lawsuit. If you have to file a lawsuit in federal court, the plan's decision is usually reviewed under an "arbitrary and capricious" standard; you are limited to the evidence that was presented to the plan administrator, and you will not be able to obtain anything more than the benefits that were promised. States can regulate insured plans through their state insurance laws, and the courts are interpreting ERISA preemption language to allow for more expansive regulation of insured plans by the states. ERISA, the Employee Retirement Income Security Act, was passed in 1974 and intended to encourage large multi-state employers to provide pension, health care and other compensation to their employees by shielding them from various state laws governing pension and insurance laws and instead requiring compliance with one set of federal laws. The law, however, also made it difficult for individuals to get relief for denied claims or botched treatment. About 80 percent of workers not covered by a government-based health plan receive their health care through an ERISA-protected plan. In response, the DOL this year issued new claim appeal procedures effective for all health benefit plans subject to ERISA regulations. It includes a specific time frame for filing an appeal, spells out the rights of the plan participants and responsibilities of the plans, and requires the plan to indicate why and on what basis a claim was denied. Handorf told participants that the first course of action should be to obtain the health plan's "SPD" or summary plan description, which describes-in plain, understandable terms-what a beneficiary is entitled to and what his or her rights are under the plan. From this, doctors and patients can determine if the denial is based on limitations allowed in the SPD. "It all comes down to how a plan is written..." says Handorf. "I would think that most plans that provide chiropractic benefits would be pretty specific about it." If a claim is denied for reasons of medical necessity, doctors and patients have the right to know the identity of the reviewer (who should have appropriate training and experience in the specific health care field involved) and the reasons for the denial. Once this information is known, doctors should submit any additional evidence supporting their treatment decisions to the health plan to be included in the official administrative record. Attention to such details of the appeals process is essential; otherwise, evidence may not be admissible further down the line.