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July 30, 2006 at 04:00 PM
America’s Health Insurance Plans is battling the American Trial Lawyers Association and the National Conference of State Legislatures over access to patients’ lawsuit settlements.
Lawmakers on a House-Senate conference committee are deciding whether to include a settlement measure, a “subrogation” provision, as they work to meld H.R. 2830 and S. 1783, the House and Senate pension bills.
At press time, a spokesperson for one of the conference members, Sen. Edward Kennedy, D-Mass., said it was unclear if the provision, Section 307, would be included in the conference’s final product.
Section 307 of H.R. 2830 would create a new federal cause of action under the Employee Retirement Income Security Act, allowing group health insurers to sue injured plan members who receive settlements from the parties that cause the injuries. Insurers would stand first in line when seeking reimbursement for expenditures from settlement funds. The provision could reduce the amount of cash that the plan members and their lawyers would receive.
The House provision would replace the current mixture of state statutes, federal statutes and court decisions that now govern group health plan subrogation actions.
Rep. John Boehner, R-Ohio, the House majority leader, is one of the pension bill conference committee members who support the provision.
Sen. Kennedy, an opponent of Section 307, said last week that removing the subrogation provision from the final pension bill is a priority.
Keeping the House’s subrogation provision would let insurers take money that was intended to cover injured patients’ future medical expenses and to compensate the patients for lost wages, according to Kennedy.
“This provision is a special interest fix that was slipped into the House bill at the last minute without a hearing and without public debate,” Kennedy said. “This troubling provision puts health insurance companies first in line, ahead of injured patients. It would allow insurers to raid funds that injured patients receive to cover future medical care or compensate for missed months of work. That’s not right.”
The U.S. Supreme Court ruled in May in Sereboff v. Mid Atlantic Medical Services Inc. that health plans can ask for reimbursement for previously provided benefits if the recipient of those benefits receives payment for the services from someone else.
