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More COBRA Election Notice Litigation: Are Your Mailing Procedures Adequate?

The last few years have seen dozens of lawsuits filed alleging failures associated with COBRA election notices. Generally, these complaints allege that (i) any deviations from the DOL model COBRA election notice (a) were done to save money for the employer and deter employees from electing coverage, and (b) resulted in a notice that would not be understood by the average participant, and (ii) the election notices did not include the required content prescribed by applicable COBRA regulations. Recent cases highlight another area of potential litigation–whether proper mailing procedures for the election notices have been followed and can be proven by the employer.  In one such case, a former employee was provided a COBRA election notice for medical coverage that was sent to her former mailing address because an updated address had not been provided to the employer’s third-party COBRA administrator. The court noted that the employer’s delegation of COBRA… Continue Reading

BCBSTX Sued in Proposed Class Action for Alleged Violations of Mental Health Parity Rules

As we have discussed in prior blog posts here and here, noncompliance with the Mental Health Parity and Addition Equity Act (the “MHPAEA”) continues to be a source of significant potential legal liability for employers that sponsor group health plans as well as for their third-party claims fiduciaries or health insurers.  As further evidence of that trend, a proposed class action lawsuit has recently been filed against Blue Cross and Blue Shield of Texas (“BCBSTX”), as a designated claims fiduciary or health insurer under the class members’ employer-sponsored group health plans, for alleged violations of the MHPAEA. In particular, the class claims that BCBSTX imposed more restrictive standards on coverage of residential mental health care than the standards applied to coverage of care at skilled nursing facilities. Under the MHPAEA, employer-sponsored group health plans and health insurers that provide mental health or substance use disorder benefits are prohibited from imposing less… Continue Reading

Prepare Benefits Materials in Consideration of the Surprise Medical Billing Rules and Model Notice

As employers prepare group health plans, SPDs, and other employee benefits materials for 2022, they need to consider the new surprise medical billing requirements under the No Surprises Act of the Consolidated Appropriations Act of 2021. Interim final rules were recently released for these new requirements, which are generally effective for plan years beginning on or after January 1, 2022. Provisions that may need to be changed include those regarding: (i) coverage of emergency services, including the definitions of emergency services and emergency medical conditions, how benefit payments are calculated, and coverage for out-of-network, independent freestanding emergency departments; (ii) network cost-sharing for out-of-network providers at network facilities who do not obtain consent for non-emergency services; and (iii) coverage of out-of-network air ambulance services. In addition, there is a new notice required that must be made publicly available, posted on a public website of the plan, and included in the plan’s… Continue Reading

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