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Primary Care Providers Win Challenge of CMS Interpretation of Enhanced Payment Law

With the help and support of the Tennessee Medical Association, 21 Tennessee physicians of underserved communities joined together and retained Bass, Berry & Sims to file suit against the Centers for Medicare & Medicaid Services to stop improper collection efforts. Our team, led by David King, was successful in halting efforts to recoup TennCare payments that were used legitimately to expand services in communities that needed them. Read more

Tennessee Medical Association & Bass, Berry & Sims

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Thought Leadership

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Thought Leadership Spotlight

Healthcare Transactions: Year in Review 2018Last year, CVS Health Corp. (NYSE: CVS) announced it would purchase health insurer Aetna Inc. (NYSE: AET) for $67.5 billion, a transaction that would be one of the biggest healthcare mergers in the past decade. The transaction raises an intriguing question: is this the beginning of a transformational shift in healthcare?

Recently, members of our healthcare group authored the Healthcare Transactions: Year in Review outlining 2017 M&A activity and drivers in the following hot healthcare sectors:

• Managed Care
• Hospitals
• Post-Acute Care—Home Health & Hospice
• Ambulatory Surgery Centers (ASCs)
• Healthcare Information Technology (HIT)
• Behavioral Health
• Physician Practice Management

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Supreme Court Decision Raises Stakes for Summary Plan Descriptions

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June 16, 2011
A recent United States Supreme Court decision expands the scope of remedies potentially available to plan participants harmed by inaccurate summary plan descriptions ("SPDs") and other informal plan communications.

In CIGNA Corp. v. Amara, the employer had converted its traditional defined benefit pension plan to a "cash balance" plan. In the course of the conversion, the employer distributed various materials to participants, including an SPD and a newsletter stating that the new cash balance plan would produce an "overall improvement in … retirement benefits" and that the company would not realize any cost savings from the conversion. In fact, these statements were inaccurate and, as applied to some participants, untrue. The communications also failed to describe a "wear away" period that would prevent some participants from accruing additional benefits for a period of time.

The Supreme Court was asked to decide what remedies were available to participants and whether benefits should be calculated as described in the informal communications, rather than under the actual plan document. The participants requested calculation as described in the communications (which had the potential to increase benefits) if they could show that "likely harm" resulted from the miscommunications. The Court rejected the request but noted that participants who could show "actual harm" from the miscommunications could seek "equitable" relief, if the miscommunication constituted intentional misrepresentation or other fiduciary misconduct actionable under Section 502(a)(3) of ERISA. The Court observed that the exact nature of equitable relief may vary from case to case.

The Amara ruling is somewhat of a surprise to many in the benefits community, given prior decisions from the Court interpreting Section 502(a)(3) very narrowly. Since the lower court decision being reviewed by the Supreme Court in Amara had not specifically addressed liability under Section 502(a)(3), some observers believe the portion of the Court’s opinion allowing possible liability under that section is non-binding "dicta." Even so, the Court has provided would-be plaintiffs with powerful ammunition, and the Department of Labor also has already used the Supreme Court decision to argue for greater responsibility on the part of fiduciaries. The decision could result in increased claims against plan fiduciaries under Section 502(a)(3), and employers would be well advised to review their participant communications (including, but not limited to, SPDs) for consistency with existing plan documents.

If you have questions regarding the information in this alert, please contact any of the attorneys in our Employee Benefits Practice Group.

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