The Department of Labor, Department of the Treasury, and the Pension Benefit Guarantee Corporation have issued new regulations effective with the 2009 Plan Year for new disclosure requirements needed to complete ERISA Form 5500.
Attached (Blue Cross Erisa5500-2009_supp_disclos) is the 2009 ERISA Disclosure Information Form issued by Health Care Service Corporation (HCSC). HCSC operates through its Blue Cross & Blue Shield plans in Illinois, Texas, New Mexico, Oklahoma and several subsidiaries.
Page 4 of the report is interesting. A careful read may bring to mind more quesitons than answers. The report states “Additional information about those types of fees, the amount of those fees and the sources of these fees is available upon request.”
Editor’s Note: Are 100% of PPO discounts passed on to the consumer?
Molly Mulbrier, famed sci-fi novelest and fictional writer of Hollywood fame writes, “For example, suppose the hospital bills an insurance company $100,000 for John Doe’s recent hospital admission. If, for example, the insurance company has an agreement with the hospital to charge a fee of up to 15% of billed charges, then the insurance company would earn up to $15,000 in fees on this claim. But, the billed charge of $100,000 has to be re-priced through the PPO network and that is reduced to $65,000 in this example (35% discount off billed charges). In this fictional and probably completely untrue scenario, the insurance company would then pay the hospital $50,000 but draft $65,000 from the employer’s self-funded claim account. ” Mulebriar continues “But this is so obscene and irrational, it could not be true and would never ever happen in the real world.”