The Only Company with Compliant Solutions for All of You

U.S. Health-care Crisis
& ERISA Criminal Enforcement

Are All Consultants Corrupt? (Fast Company)

"Failure of Imagination" Again?

"John Q.
ERISA
Enforcement"

U.S. Labor Secretary Elaine L. Chao Announces Stronger Retirement, Health Benefit Security for American Workers - 121% Increase in Monetary Results Shows “Commitment to Protect Hard-Earned Benefits” Release Date: 10/21/2004

"EBSA closed 4,399 civil investigations in FY 2004. Nearly 70% of those investigations resulted in correction of violations under the Employee Retirement Income Security Act (ERISA). Criminal investigations led to the indictment of 121 individuals. In addition, EBSA received a record 474 applications to participate in its compliance assistance program to help employers and plan officials to voluntarily correct specific violations of the law."

EBSA Achieves Record $3.1 Billion in Fiscal Year 2004 Results • Press Release

Spitzer's Latest Target (yahoo.businessweek.com)

"New York's Attorney General now has employee-benefits insurers in his sights. A federal probe could be next
... WASHINGTON, TOO? "We found that favoritism, secrecy, and conflicts rule this market, and not open competition," said Spitzer in testimony about the insurance ..."

U.S. Senate Committee on Governmental Affairs:

"Oversight Hearing on Insurance Brokerage Practices, Including Potential Conflicts of Interest and the Adequacy of the Current Regulatory Framework." Date: 11/16/04

From 03-03-2004 to 05-10-2004 to 09-30-2004

Why Bogus Plans Called "ERISA Advantage"???

Because There is An Advantage of None or Little/Late Enforcement of ERISA

Man Sentenced to Prison in Nationwide Health Insurance Scheme (Axcess News)

Excerpt: "In pleading guilty, [John B.] Hyde admitted that he was president of ISI which operated in Novato [California]. ISI marketed and sold a health plan known as the ERISA Employee Health Benefit Plan or the ERISA Advantage. The health plan was marketed and sold to thousands of people throughout the country who believed that they were covered by a legitimate health plan."

ERISAclaim.com - A $1.0 Trillion Nuclear Solution to U.S. Health-care Crisis & $44 Trillion Budget Deficits

ERISAclaim.com: 50% Savings - Healthcare Crisis Turnaround for Employers, Insurers & TPA's

ERISAclaim.com - 950,000 MD's Settled With Aetna & Cigna on ERISA

ERISAclaim.com:  ERISA Certification Programs
for Cost-Saving & Reimbursement by Compliance

DOL + DOJ Enforcement of ERISA

HHS Works with ERISA (+77 Millions/4 Yrs)

 New Federal Claim Regulation (Final Rule)
Benefit Claims Procedure Regulation (FAQ)
Amendments to Summary Plan Description Regulations (Final Rule)
Patient's Rights Claims Procedure Regulation (Fact Sheet)
What You Should Know about Filing Your Health Benefits Claim

Criminal Resource Manual (ERISA)

(Please click on the hyperlinks to view the official DOJ web & documents)

Department of Justice > USAM > Title 9 > Criminal Resource Manual | 2401 |

2414. 29 U.S.C. § 501(c) -- Embezzlement and Theft From Labor Unions in the Private Sector; 18 U.S.C. § 664 -- Embezzlement and Theft From Employee Benefit Plans in the Private Sector
       
2415. Investigative Jurisdiction -- 29 U.S.C. § 501(c) and 18 U.S.C. § 664
       
2416. Form Indictment -- Embezzlement and Theft of Labor Union Assets in the Private Sector -- (29 U.S.C. § 501(c))
       
2417. Form Indictment -- Embezzlement and Theft From an Employee Pension or Welfare Benefit Plans or a Fund Connected With Such Plans -- (18 U.S.C. § 664)
       
2418. 29 U.S.C. 501(c) Decisions
       
2419. 18 U.S.C. § 664 Decisions
       
2420. Employee Benefit Plan Kickbacks -- 18 U.S.C. § 1954
       
2421. Investigative Jurisdiction
       
2422. Bribery and Graft Affecting Employee Benefit Plans -- 18 U.S.C. § 1954
       
2423. Form Indictment -- Solicitation and Receipt of Bribery and Graft Affecting Employee Pension or Welfare Plan in the Private Sector -- (18 U.S.C. § 1954)
       
2424. Form Indictment -- Offer and Gift of Bribery and Graft Payments Affecting Employee Pension or Welfare Plan in the Private Sector -- (18 U.S.C. § 1954)
       
2425. Employee Benefit Plan Kickbacks -- (18 U.S.C. § 1954)
       
2426. Decisions Involving 18 U.S.C. § 1954
       
2427. Employee Retirement Income Security Act of 1974 (ERISA) -- 29 U.S.C.§§ 1001 et seq.
       
2428. Investigative Jurisdiction
       
2429. Failure to Perform ERISA Reporting and Disclosure -- 29 U.S.C. § 1131 (ERISA Section 501)
       
2430. Elements of Proof for 29 U.S.C. § 1131 and ERISA Obligations
       
2431. Form Indictment -- 29 U.S.C. § 1131
       
2432. Coercive or Fraudulent Interference with ERISA Rights -- 29 U.S.C. § 1141
       
2433. Form Indictment -- 29 U.S.C. § 1141
       
2434. Investigative Jurisdiction -- 29 U.S.C. § 439
       
2435. Investigative Jurisdiction -- 18 U.S.C. § 1027
       
2436. Form Indictment -- Falsification of Annual Financial Report Filed by Labor Union in the Private Sector (29 U.S.C. § 439(b))
       
2437. Form Indictment -- Falsification, Concealment or Destruction of Financial Records Required to be Kept by Labor Union in the Private Sector (29 U.S.C. § 439(c))
       
2438. Form Indictment -- False Statements and Concealment of Facts in Employee Benefit Plan Records or Reports
       
2439. Decisions Related to 18 U.S.C. § 1027

If enforced as intended by Congress, ERISA could be the best protection for employee benefits plans, Rx for US health care crisis.

 

Jin Zhou, March 2005

2429 Failure to Perform ERISA Reporting and Disclosure -- 29 U.S.C. 1131 (ERISA Section 501)

Title 29 U.S.C. § 1131 states:

Any person who willfully violates any provision of part 1 (Reporting and Disclosure) of this subtitle (Subtitle B-Regulatory Provisions of ERISA), or any regulation or order issued under any such provision, shall upon conviction be fined not more than $5,000 or imprisoned not more than one year, or both; except that in the case of such violation by a person not an individual, the fine imposed upon such person shall be a fine not exceeding $100,000. [The amount of the fine is governed by 18 U.S.C ?.]

2438 Form Indictment -- False Statements and Concealment of Facts in Employee Benefit Plan Records or Reports

(18 U.S.C. § 1027)

The Grand Jury Charges:

2435 Investigative Jurisdiction -- 18 U.S.C. 1027

2435 Investigative Jurisdiction -- 18 U.S.C. 1027

2430 Elements of Proof for 29 U.S.C. 1131 and ERISA Obligations

    On appeal the defendant challenged the court's instruction to the jury that it need only find that the defendant had "knowingly and intentionally committed the acts which [violated Part 1 of ERISA] and . . . were not committed accidentally or by some mistake." Id. at 1583. Rejecting the defendant's claim that the jury should have been instructed that section 1131 requires a "specific intent to do something the law forbids; that is with bad purpose to disobey or disregard the law," the court upheld the trial court's instruction that section 1131 requires only a general intent and knowledge of one's acts. In construing section 1131, the court in Phillips reasoned that the ERISA misdemeanor does not require proof of a specific intent to violate the law because the statutory defense codified at 29 U.S.C. § 1028, based on good faith compliance with Department of Labor regulations, would be redundant if "willfully" required such specific intent and would, in effect, render the "willfully" in section 1131 "meaningless surplusage." Id. at 1584.

    See also United States v. Tolkow, 532 F.2d 853 (2d Cir. 1976), upholding the conviction of a plan trustee for having "knowingly" failed to report required party-in-interest transactions in the plan's annual financial report under ERISA's predecessor, the Welfare and Pension Plans Disclosure Act, in violation of 18 U.S.C. § 1027. Rejecting the assertion that section 1027 required proof of a specific intent to violate the law and actual knowledge of the reporting obligations, the court in Tolkow held that the defendant need only have a reckless disregard of whether he was violating the reporting obligation by failing to make any disclosure. Id. 857-59 and cases cited therein.

REPORTING, DISCLOSURE, AND RECORDKEEPING OBLIGATIONS

 

DOCUMENTS REQUIRED TO BE FILED

 

Documents that an ERISA plan administrator is required to file include:

 

 

·        A plan description;
 

·        A summary plan description;
 

·        Modifications and changes to the plan; and
 

·        An annual financial report, terminal and supplementary reports as required.

 

DOCUMENTS SUBJECT TO DISCLOSURE

 

 

Documents that an ERISA plan administrator is required to disclose include:

 

·        A summary plan description;
 

·        Modifications and changes to the plan;
 

·        A summary annual report;
 

·        A statement of accrued and vested benefits;
 

·        The latest Annual Report (Form 5500 series); and
 

·        Documents under which an employee benefit plan is established or operated (i.e., plan document and any trust agreement).

 

Documents which must be disclosed on request, including a statement of accrued and vested benefits, the latest Annual Report (Form 5500), and the Plan Document.

 

 

RECORD RETENTION

 

Section 107 (29 U.S.C. § 1027) states that:

 

"every person subject to a requirement to file any description or report or to certify any information...shall maintain records on the matters of which disclosure is required WHICH WILL PROVIDE IN SUFFICIENT DETAIL THE NECESSARY BASIC INFORMATION AND DATA FROM WHICH THE DOCUMENTS THUS REQUIRED MAY BE VERIFIED, EXPLAINED, OR CLARIFIED, AND CHECKED FOR ACCURACY AND COMPLETENESS, AND SHALL INCLUDE VOUCHERS, WORKSHEETS, RECEIPTS, AND APPLICABLE RESOLUTIONS, and shall keep such records available for examination for a period of not less than six years after the filing date of the documents based on the information which they contain, or six years after the date on which such documents would have been filed but for an exemption..."

 

EXEMPTIONS FROM REPORTING AND DISCLOSURE

The following plans are exempt from ERISA's Reporting and Disclosure requirements:

Any employee welfare plan which covers fewer than

100 participants at the beginning of the plan year;

Any employee pension or welfare plan whose benefits are provided solely from the general assets of the employeror employee organization maintaining the plan;


Any employee pension or welfare plan whose benefits are provided exclusively through insurance contracts or policies issued by an insurance company, provided that any contributions made by the employees are forwarded to the insurance company within three months;

Any employee welfare plan which is an apprenticeship plan that exclusively provides apprenticeship training benefits provided:

 

1. that the administrator files certain information with the Secretary of Labor;

 

2. ensures that the information required to be contained in such notice to the Secretary of Labor is also disclosed to employees of employers contributing to the plan who may be eligible to enroll in any course of study sponsored or established by the plan; and

 

3. makes the above information available to employees upon request; or

Any employee welfare benefit plan which provides for day care centers.

EXAMPLES OF VIOLATIONS

Omission or refusal to file with Labor Department annual financial reports (5500 series), plan description, summary plan description (29 U.S.C. § 1024);

Omission or refusal to publish summary plan descriptions to participants (29 U.S.C. § 1024);

Omission or refusal to furnish information concerning benefits to pension plan participants (29 U.S.C. § 1025);
 

or,

Failure to maintain records from which reports and other required documents can be verified and checked (29 U.S.C. § 1027).

2432 Coercive or Fraudulent Interference with ERISA Rights -- 29 U.S.C. 1141

Title 29 U.S.C. § 1141 states:

It shall be unlawful for any person through the use of fraud, force, violence, or threat of the use of force or violence, to restrain, coerce, intimidate, or attempt to restrain, coerce, or intimidate any participant or beneficiary for the purpose of interfering with or preventing the exercise of any right to which he is or may become entitled under the plan, this title, section 3001, or the Welfare and Pension Plans Disclosure Act. Any person who willfully violates this section shall be fined $10,000 or imprisoned for not more than one year, or both. The amount of fine is governed by 18 U.S.C. § 3571. The U.S. Sentencing Guidelines address 29 U.S.C. § 1141 under the guidelines for "Fraud and Deceit" (U.S.S.G. § 2F1.1) or for "Extortion by Force or Threat of Injury or Serious Damage (U.S.S.G. § 2B3.2).

In order to establish a violation of 29 U.S.C. § 1141, the government must allege and prove the following essential elements:

1.      The jurisdictional entity involved is an employee benefit plan within the meaning of title I of ERISA (29 U.S.C. §§ 1001 et. seq.).

Employee benefit plan is defined as an employee pension benefit plan or an employee welfare benefit plan. 29 U.S.C. § 1002(1), (2), and (3).

2.     The victim is a participant or beneficiary as defined in the statute. "Participant" and "Beneficiary" are defined at 3(7) and 3(8)(29 U.S.C. § 1002).

3.      The violator can be any person who uses fraud, force, violence, or threats of force or violence.

4.     The violator restrained, coerced, or intimidated, or attempted to restrain, coerce, or intimidate, a participant or beneficiary for purposes of interfering with their protected rights.

5.      Protected rights include any right to which a participant or beneficiary is or may become entitled to under the plan, Title I of ERISA, 29 U.S.C.§ 1201 (relating to tax qualification of the plan), or the WPPDA (predecessor statute to ERISA).

6.     The violator acted WILLFULLY.

For example, Section 1141 would reach the use of deception directed at misleading a welfare plan beneficiary as to the amount of health benefits owed to the beneficiary under the terms of the plan or at misleading a pension plan participant as to the amount of retirement benefits to which he would become entitled under the plan upon his retirement.

U.S. Health-care Crisis
& ERISA Criminal Enforcement

ERISAclaim.com - A $1.0 Trillion Nuclear Solution to U.S. Health-care Crisis & $44 Trillion Budget Deficits

ERISAclaim.com: 50% Savings - Healthcare Crisis Turnaround for Employers, Insurers & TPA's

ERISAclaim.com - 950,000 MD's Settled With Aetna & Cigna on ERISA

ERISAclaim.com:  ERISA Certification Programs
for Cost-Saving & Reimbursement by Compliance

ERISAclaim.com - U.S. Health-care Crisis
& ERISA Criminal Enforcement

DOL + DOJ Enforcement of ERISA

HHS Works with ERISA (+77 Millions/4 Yrs)

2004.02.19: Text of Letter From Tommy G. Thompson Secretary of Health and Human Services To Richard J. Davidson, President, American Hospital Association.  

HHS FAQ "Questions On Charges For The Uninsured" (PDF)

HHS FAQ's "regarding offering discounts to the uninsured" (PDF)

OIG "HOSPITAL DISCOUNTS OFFERED TO PATIENTS WHO CANNOT AFFORD TO PAY THEIR HOSPITAL BILLS"

Medical Fraud Every Day?

Appeal or Re-Bill After Denial?

You Must APPEAL

No Re-Billing!!!

Claim Appeal or Sentencing Appeal?

Your Choice

Aetna:  Leading the Fight Against Health Care Fraud [PDF] View as HTML

"Thanks to this highly collaborative relationship, we know how to identify fraud because we know what to look for.

 

Medical Fraud

1. Unusual provider billing practices.

2. Discrepancy between the submitted diagnosis and the treatment.

3. Diagnoses or treatments that are outside the practitioner’s scope of practice.

4. Claims that are resubmitted with coding changes to gain benefits.

5. Alterations on claim submissions.

6. Pressure for quick claim payment."

Payments Go Under a Microscope (washingtonpost.com) January 12, 2004

"MAMSI and CareFirst recoup overpayments to doctors by making deductions from future reimbursements. Doctors can appeal insurers' decisions. But, in the end, they usually pay up, doctors and insurers agree."

Employers Audit Workers' Health Claims (Wall Street Journal via SFGate.com)

Excerpt: "Looking to bring down soaring health-care costs anywhere they can, more employers are scouring their health plans for fraud, abuse and simple mistakes by employees or administrators.

.......The number of requests for such audits jumped 50 percent last year, Mr. Farley estimates."

Blue Cross and Blue Shield Association Announces New Strike Force to Protect American Consumers from Fraud and Fight Rising Costs (U.S. Newswire, 4/19/2004)

"DETROIT, April 19 /U.S. Newswire/ -- The Blue Cross and Blue Shield Association (BCBSA) today announced a new Anti-Fraud Strike Force comprised of top Blue Plan investigators that will work with the Federal Bureau of Investigation (FBI) and other national, state and local law enforcement agencies to fight major insurance fraud schemes that rob consumers of millions of dollars annually. BCBSA President and CEO Scott P. Serota announced the new initiative in a speech to the Detroit Economic Club."

Clinton Township Firm Convicted of Overbilling (Macomb Daily)

"The case is somewhat unusual in that a corporation was named as a criminal defendant in the case, but Kaiser said that is not unheard of since corporate law can make a firm liable for criminal wrongdoing, and its principal office holders in return are responsible for any judgments or punishments the courts impose.

David Griem, the defense attorney for Emergency Management who was also named the principal to enter a guilty plea on its behalf, also could not be reached for comment after the sentencing hearing. In court, however, he turned over a check to the Blue Cross insurance company officials in attendance and said the company would pay the $5,000 court costs on time as well."

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