Benefits June 19, 2013

Even with Insurance, Many Not Getting Health Care

June 19, 2013 (PLANSPONSOR.com) – Many individuals with employer-sponsored health insurance are delaying or avoiding getting health care due to cost.
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Whether it’s a “consumer-driven,” high-deductible, or traditional managed-care health plan, a significant number of people with health insurance report problems with access to health care services, according to new research by the Employee Benefit Research Institute (EBRI). Not surprisingly, limited health care access—broadly defined as not filling prescriptions due to cost, skipping doses to make medication last longer, or delaying or avoiding getting health care due to cost—is more of a problem among those with lower incomes.  

An analysis of results from the 2012 EBRI/MGA Consumer Engagement in Health Care Survey found: 

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  • In 2012, 26% to 40% of respondents reported some type of access-to-health-care issue for either themselves or family members. Individuals in consumer-driven health plans (CDHPs) and high-deductible health plans (HDHPs) were more likely than individuals with traditional coverage to report access issues; 
  • Individuals in households with less than $50,000 in annual income were more likely to report access issues; 
  • Very few differences in access issues were found by whether employers contributed to the account, but higher contribution amounts were linked to access issues for the first time in the 2012 survey; and 
  • For the first time, length of time with the account was found to have had an impact on access issues, with those with more years with the account more likely to be associated with access issues. 

  

One issue that is thought to improve health access is having a so-called “medical home,” meaning having a personal physician who knew them personally, had their medical history, and coordinated care. However, EBRI found that having a medical home did not reduce access issues, with one exception: Among individuals with traditional coverage, those with medical homes were statistically less likely to report that they delayed or avoided getting health care due to cost. Furthermore, among CDHP enrollees the likelihood of reporting access issues was higher among those with medical homes than those without them.  

The full report is published in the June 2013 EBRI Notes, “Use of Health Care Services and Access Issues by Type of Health Plan: Findings from the EBRI/MGA Consumer Engagement in Health Care Survey,” at www.ebri.org.
Compliance June 19, 2013

SERP Participants’ Claims Not Preempted by ERISA

June 19, 2013 (PLANSPONSOR.com) – A federal court ruled Supplemental Executive Retirement Plan (SERP) participants’ state law claims are not preempted by the Employee Retirement Income Security Act (ERISA).
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The 6th U.S. Circuit Court of Appeals noted a claim is within the scope of ERISA § 1132(a)(1)(B) if two requirements are met: (1) the plaintiff complains about the denial of benefits to which he is entitled “only because of the terms of an ERISA-regulated employee benefit plan”; and (2) the plaintiff does not allege the violation of any “legal duty (state or federal) independent of ERISA or the plan terms[.]” The court found Heartland Industrial Partners’ duty not to interfere with the executives’ SERP agreement with Metaldyne arises under Michigan tort law, not the terms of the SERP itself, because participation in the SERP was part of an employment contract between the company and executives. “Nobody needs to interpret the plan to determine whether that duty exists,” the court said in its opinion.  

The 6th Circuit conceded that terms of the plan may need to be referenced to calculate any damages that may be owed to the executives, but this was irrelevant to establishing jurisdiction.  

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The appellate court remanded the case back to a federal district court with instructions to remand the case to Wayne County Circuit Court in Michigan.  

In August 2006, Heartland agreed to sell its ownership interest in Metaldyne to another investment firm, Ripplewood Holdings. Ripplewood threatened to back out of the deal when it found out about the $13 million SERP obligation. In response, Heartland founders persuaded Metaldyne’s board (of which they were chairman and a member, respectively) simply to declare the SERP invalid. The board did so on December 18, 2006, though it did not notify plaintiffs of that fact at the time.  

A month after the deal closed, Metaldyne notified participants it had invalidated the SERP. In response, several executives filed lawsuits in the Wayne County, Michigan Circuit Court. The current case alleges a single state-law claim for tortious interference with contractual relations.  

The opinion in Gardner v. Heartland Industrial Partners is at http://www.ca6.uscourts.gov/opinions.pdf/13a0133p-06.pdf.

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