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Feds Win Judgment Against Association Plan

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The U.S. Department of Labor has obtained a consent judgment and court order requiring a state medical society to reimburse beneficiaries for claims left over from a health plan that the society once operated, officials say.

The judgment and order resolve a suit filed in the U.S. District Court for the Southern District of Mississippi.

The order requires the Mississippi State Medical Association, Ridgeland, Miss., to help 1,800 individuals who participated in the MSMA’s old Mississippi State Medical Association Benefit Plan and Trust pay any unpaid health claims the association plan originally was supposed to pay.

Mississippi association representatives were not immediately available to comment.

The MSMA started the association health plan in the 1980s to provide health benefits to for MSMA member physicians and the members’ employees and families, Labor Department officials say.

When the MSMA shut the plan down Jan. 1, 2004, the plan had more than $5 million in unpaid claims on its books, officials say.

“Although [the] MSMA advised the department that it had requested its members and other medical care providers in Mississippi refrain from referring plan participants to collection agencies and consider waiving payment of claims, a survey of participants performed at the department’s direction revealed that participants continued to pay Mississippi medical care providers, had been referred to collection agencies and had suffered damage to credit as a result of the plan’s termination,” officials say.

The judgment appoints Receivership Management Inc., Brentwood, Tenn., to manage the distribution of MSMA plan assets, officials say.

The judgment also keeps the MSMA from being a plan fiduciary and keeps doctors from going after plan members for bills that the plan was supposed to pay, officials say.