Obama Administration Publishes Final Mental Health/Substance Abuse Parity Rule (Mondaq, 11/16/2013)
Earlier this month, the Departments of Health and Human Services, Labor and Treasury jointly published final rules implementing the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). The Act requires group health insurance plans to treat mental health or substance use disorder benefits the same as medical/surgical benefits with respect to financial requirements (e.g. copayments and deductibles). (Note: The Affordable Care Act extended the MHPAEA to apply to individual health insurance market.) The final rules generally apply to plan years beginning on or after July 1, 2014, but plans must continue to comply with the interim final rules until then.
Medicare Secondary Payer
CMS Proposal on SMART Act Stirs Concern (Property Casualty 360, 11/18/2013)
The most significant concern reflected by comments submitted to CMS about its Interim Final Rule implementing the SMART Act is that it more than doubles the statutory period for CMS to tell insurers how much of a final settlement they have to give to CMS instead of the plaintiff. CMS now has 245 days to process claims rather than 120 days.
Franco Signor Comments on SMART Act Interim Final Rule (Franco Signor MSP Blog, 11/18/2013)
The consulting firm Franco Signor has posted on its blog comments to the Centers for Medicare and Medicaid Services about the new CMS Interim Final Rule (IFR). The comments ask CMS to either withdraw the IFR or, absent that, to change it to comport with current contractor practices and the SMART Act time frames. The blog includes a useful side-by-side comparison of the SMART Act and the IFR provisions, along with a mark up of the IFR language making comments and suggesting specific changes. Many of the comments relate to time frameworks that are inconsistent with the SMART Act, additional steps or restrictions that have been created by CMS and may be traps for the unwary, and relaxing of the requirements made of CMS in the SMART Act. These comments are well worth the time to read for a pool claim operations that deals with Medicare Secondary Payer issues.
Property & Casualty
Telematics An Advantage with Driverless Cars, Says Progressive CEO (Insurance Journal, 11/15/2013)
The intersection insurance, telematics and driverless automobile technology may be something pools need to consider over the next few years. Auto coverage will need to evolve as driverless technology reduces the role of driver error in accidents, and adds malfunction of the driverless system as a new source of accidents.
BNY Mellon report says cat bond market could more than double to $50 billion by 2018 (Yahoo Finance, 11/14/2013)
BNY Mellon projects that the number of cat bonds outstanding could more than double by the end of 2018. The current level of $19 billion could reach $50 billion. Long-term investors such as pension funds are buying cat bonds for their higher yields and diversification of risk as compared to investments in the broader financial markets.
TRIA Issue Could Wait Until Spring: Signs Are Backstop May Look Different (Property Casualty 360, 11/13/2013)
At recent hearings on the reauthorization of the Terrorism Risk Insurance Act by the Housing and Insurance Subcommittee of the House Financial Services Committee, the Republican majority committee leadership indicated that it doesn’t plan to take up reauthorization until next spring at the earliest. TRIA is set to expire at the end of 2014 if it is not extended. Insurance industry representatives supported TRIA and testified that the industry is required to assume more risk, prices will rise and take-up will fall. Potential changes discussed include the following:
Transitioning to a terrorism risk insurance market that is less dependent on a taxpayer funded backstop.
Raising the $100 million loss trigger significantly, perhaps to as much as $20 billion to $25 billion.
Clarification of the language for certifying a terrorism event.
Including more incentives for larger capacity in the private sector for insurance risk.
Second US lawsuit filed over body cavity searches (Washington Post, 11/8/2013)
Law enforcement agencies in New Mexico have been sued for the second time for invasive body cavity searches following a search of their vehicle by a drug-sniffing dog. A prior lawsuit involved a man whose was taken to two hospitals and subjected to anal probes, three enemas, two body x-rays and a colonoscopy after a dog alerted during a traffic stop. The second lawsuit involves a man who was subjected to a body cavity search after a dog alleged to be inadequately trained and certified alerted to the driver’s seat of his car. Neither man was found to be transporting drugs. Both cases involve questionable search warrants.
Are Pre-Denial Claims Communications Admissible In Court? (Property Casualty 360, 10/8/2013)
A New York Court has ruled that attorney work product does not include documents prepared by, and communications with, attorneys prior to a firm decision to deny a claim under FOIA. The attorney work product exclusion protects documents prepared by an attorney in anticipation of, or during, litigation. Thus, communication and documentation while making a decision about denial are not protected. The court noted that the investigation and denial of claims are normal parts of insurance company activity, and this are not privileged. A New York court has ruled that the attorney work product exclusion of FOIA does not apply to documents prepared by and communications with attorneys prior to a firm decision to deny a claim. The attorney work product exclusion protects documents prepared by an attorney in anticipation of or during litigation. Thus communication and documentation while making a decision about denial are not protected. The court noted that the investigation and denial of claims is a normal part of insurance company activity, and thus not privileged.
The Most Dangerous Government Jobs and Why They're Riskier Than the Private Sector (Governing, 11/19/2013)
Labor Department workplace injury and illness data shows that many individuals working in government sector jobs are more likely to be injured than their private sector counterparts. Federal data estimates 6.1 nonfatal work related injuries or illnesses for every 100 full time employees, as compared to a rate of 4.4 for state workers and 3.4 for private sector workers. Although some public sector jobs, like police and fire, hold inherent risks not necessarily duplicated in the private sector, the comparison does hold true for jobs where there is a close comparison, such as teaching and transportation. The BLS table of causes of injury for local government occupations identifies overexertion and bodily reaction followed by slips trips and falls as the most frequent cause of injury.
Iowa Court: Immigrant Worker on Expired Visa Gets Workers’ Comp (Claims Journal, 11/18/2013)
The Iowa Supreme Court has ruled that an employee who was injured while working in the U.S. is entitled to workers’ compensation benefits even though she was in the U.S. on an expired visa. She had been in the U.S. for 19 years. She was fired from her job after surgery for a work related injury on the stated grounds that she did not have legal authorization to work in the U.S. The Iowa court held that the state law did not explicitly exclude undocumented workers from the workers’ compensation law. It also rejected the employer’s challenge based on the federal Immigration Reform and Control Act of 1986 (IRCA), which prohibits U.S. employers from hiring undocumented workers. The court noted that it was not the intent of Congress to preempt labor protection laws by passing the IRCA.
Chicago Said to Weigh Suit Over Marketing of Painkillers (New York Times, 11/14/2013)
The city of Chicago is investigating the marketing of narcotic painkillers, as a possible prelude to a lawsuit against the manufacturers based on overstatement of benefits and understatement of risk. If litigation is eventually filed as a class action, NLC-RISC pools’ member cities might be able to participate, but the New York Times notes that such litigation would be challenging due to FDA approval of opioids as safe and effective.
Florida Outpatient Costs for Injured Workers Rising Rapidly: WCRI (Insurance Journal, 11/11/2013)
A study by the Workers’ Compensation Research Institute shows that the average cost per claim of outpatient care in the Florida workers’ compensation system is growing rapidly. The report says that the increase may be driven by increases in the average payment per service in Florida, as compared to fixed amount fee schedules in other states.
Other Topics of Interest
SANS Discount Purchasing Winter Window Opens December 1st
The discount purchasing window for the SANS Securing the Human Training, which was discussed at the spring NLC-RISC Trustees Conference, opens December 1, 2013 and continues through December 31, 2014.
Cops Like What They See with License Plate Readers (Governing, 11/19/2013)
License plate reading technology mounted on police vehicles or roadsides are helping police identify vehicles registered to those the police may want to locate, recover stolen vehicles, and perform other law enforcement functions. The readers consist of optical scanners that match the plate to a registrant using a back-end database. However privacy concerns may make this technology a potential problem for pools and their members. Privacy advocates are suing the Los Angeles Police Department and the Los Angeles County Sheriff’s Department alleging that they are amassing an intelligence infrastructure that they are using to monitor citizens.
Drug Use Among American Workers Declined 74% Over Past 25 Years, Finds Unprecedented Analysis of More Than 125 Million Workplace Urine Drug Tests (Wall Street Journal, 11/18/2013)
Although workplace use of many drugs has fallen significantly since the Drug Free Workplace Act was passed twenty-five years ago, amphetamines and prescription opiates have increased, according to a study by Quest Diagnostics. According to a spokesperson for Quest, other research shows that it is unlikely that these reductions would be reflected in workplaces that do not have workplace drug testing programs.
County may lose group insurance over settlement (The Columbian, 11/16/2013)
A county in Washington may lose its coverage with the Washington Counties Risk Pool after entering into a $10.5 million settlement agreement that permitted the plaintiffs in a wrongful imprisonment case to sue the pool for an additional $24 million. The pool gave notice that the settlement is in violation of the interlocal agreement. A separate court proceeding is pending to determine the legitimacy of the settlement. The pool had declined to pay the original $10.5 million settlement because the county was not a member of the pool at the time of the wrongful convictions.
Climate change takes aim at South (The State, 11/13/2013)
According to new research, a variety of adverse effects on the Southeastern U.S. are expected as climate change progresses, including some that will affect cities and their infrastructure. Among the potential impacts are more wildfires, damage to roads and bridges, rising sea levels and more intense hurricanes.
New York City Doesn’t Protect Disabled in Emergencies (Insurance Journal, 11/11/2013)
A U.S. District Judge has issued an opinion that New York City violated the Americans With Disabilities Act when its emergency preparedness plans failed to ensure that people with disabilities could evacuate and find shelter. The decision was handed down in a case brought by two non-profit advocates for the disabled, and could have impact nationwide as cities develop their emergency evacuation and shelter plans. The judge cited the lack of planning to evacuate the disabled from high-rise buildings in the wake of Super storm Sandy as an example of the city’s lack of planning for the disabled.
Essentials in Risk Pool Management Certificate Program
This is a one-course certificate program that satisfies one of the five required courses for the Associate in Risk Pool Management Designation through IEA. Online courses start 2/6/2014. Click on the link above for more information.
Southeast Loss Control Meeting (March 25-28, 2014)
The TML Risk Management Pool (TN) is hosting this year's SELC meeting at the DoubleTree in Downtown Nashville. Contact Michael Fann for more information.
NLC-RISC Trustees Conference (May 8-9, 2014)
The Trustees Conference will be held at the Westin San Diego Gaslamp Quarter hotel on May 8-9, 2014. An agenda and hotel registration will be available soon.
Employment Opportunities in Pooling
Visit the NLC-RISC website under the Resource tab for details about the following positions, or click on the job title to be directed to the pool's job posting on their website.
Senior Accountant (Rhode Island Interlocal Risk Management Trust)
Loss Control Manager (Municipal Association of South Carolina)