Fifth Circuit Wrestles with Excessive Fees Class Action for the Third Time

By Peter Sessions - This published opinion is the third by the Fifth Circuit in this class action challenging the imposition of excessive fees in the administration of ERISA-governed retirement and welfare benefit plans, with the potential of more to come. Read Full Article…

HVBA Article Summary

1. Plaintiffs and Allegations: Heriberto Chavez, Evangelina Escarcega, and Jorge Moreno, former employees of the Training, Rehabilitation & Development Institute, Inc. (TRDI), allege that Plan Benefit Services, Fringe Insurance Benefits, and Fringe Benefit Group (collectively “FBG”) abused their control over benefit trusts by charging excessive fees, in violation of the Employee Retirement Income Security Act (ERISA).

2. District Court and Fifth Circuit Decisions: The district court denied FBG's motion to dismiss and granted class certification for the plaintiffs. However, the Fifth Circuit initially reversed this decision, requiring a more rigorous analysis for class certification. Upon remand, the district court reaffirmed the class certification, which was later upheld by the Fifth Circuit, albeit with modifications.

3. Recent Developments and Legal Framework: In the latest ruling, the Fifth Circuit emphasized that the plaintiffs have standing under either the "class certification approach" or the "standing approach." However, it reversed the previous decision under Rule 23(b)(1), finding that this case primarily seeks damages, making Rule 23(b)(3) the appropriate mechanism for class certification. The case was remanded for further consideration of trial administration and potential subclass certification.

Military Households Express Higher Retirement Confidence Than Non-Military Households

By Remy Samuels - The Employee Benefit Research Institute’s recent Retirement Confidence Survey found that in 2024, Americans’ confidence in having enough money to live comfortably throughout retirement has not fully recovered from a decline in 2023. Read Full Article…

HVBA Article Summary

1. Higher Retirement Confidence Among Military Households: The EBRI study found that military households exhibit significantly higher confidence in their retirement prospects compared to non-military households. This is particularly evident among those with higher incomes, with 89% of military households earning $75,000 or more feeling confident about their retirement income, compared to 81% of non-military households in the same income bracket.

2. Differences in Financial Assets and Debt Perception: Military households tend to have higher levels of financial assets, with 49% reporting $250,000 or more, versus 40% of non-military households. Additionally, military households are less likely to see debt as a hindrance to retirement savings, with 55% considering debt not a problem, compared to a lower percentage among non-military households.

3. Knowledge and Utilization of Retirement Plans: Military households generally have more knowledge about retirement plan regulations but are also more likely to take loans or withdrawals from their retirement plans, with 22% having done so, compared to 16% of non-military households. Despite their advantageous position, military households still face common retirement challenges, such as deciding when to retire and managing retirement assets.

PBMs battle bipartisan scrutiny as lawmakers eye reforms

By Susanna Vogel and Rebecca Pifer - In a Congressional hearing Tuesday, lawmakers from both parties pressed executives from the largest pharmacy benefit managers in the nation — CVS Caremark, UnitedHealth Group’s Optum Rx and Cigna’s Express Scripts — on the role their companies play in prescription drug costs. Read Full Article…

HVBA Article Summary

1. Key Testimonies from PBM Executives: For the first time since 2019, top decision-makers from major pharmacy benefit managers (PBMs) testified before Congress, including Adam Kautzner of Express Scripts, David Joyner of CVS Caremark, and Patrick Conway of Optum Rx. This hearing, led by the House Committee on Oversight and Accountability, highlighted the significant influence these companies wield over the U.S. prescription drug market, controlling approximately 80%.

2. Public and Legislative Scrutiny: The hearing was part of a broader congressional investigation into PBM practices, which have faced criticism for increasing drug prices and limiting consumer choice. A recent report by Chairman James Comer and the FTC underscored these concerns, suggesting that PBMs' business models contribute to higher costs. PBMs, however, defended their role, asserting they reduce costs for consumers and operate on thin margins.

3. Calls for Reform: Lawmakers expressed growing dissatisfaction with the current PBM practices, emphasizing the need for regulatory reforms. Despite PBM executives arguing that their services lead to significant savings, bipartisan support for PBM reform is gaining traction, with recent legislative efforts aiming to increase transparency and fairness in drug pricing.

Texas judge weighs ‘party restrictive’ injunction to halt DOL fiduciary rule

By John Hilton - A Texas judge could decide this week on a preliminary injunction request to freeze the Department of Labor Retirement Security Rule, its latest attempt to expand fiduciary duty to insurance agents. Read Full Article…

HVBA Article Summary

1. Focus on Insurance Agents: The primary focus of the plaintiffs, represented by Don Colleluori, is on insurance agents. They argue for a blanket injunction similar to the one granted in a previous case, citing potential confusion if the rule is only applied selectively.

2. Government's Stance: The government, represented by attorney Alexander Ely, advocates for plaintiff-specific relief if an injunction is issued. They emphasize the variability in state regulations and the potential harm from the rule, particularly in the insurance sector.

3. Legal Precedents and Arguments: Colleluori referenced the 2018 Fifth Circuit ruling, which limited the scope of fiduciary duty to those with a relationship of trust and confidence with the client. Ely countered by highlighting the distinction between the current and previous DOL rules, emphasizing that not all transactions involve fiduciary duties.

Roche cuts two more TIGIT trials, plans accelerated timeline for obesity drugs

By Amber Tong - A year into Roche’s comprehensive portfolio review, the Swiss pharma said it has now taken out 25% of new drug candidates from its pipeline. The ongoing exercise will create room for it to keep bringing in innovation from outside such as the weight loss drugs from Carmot Therapeutics, CEO Thomas Schinecker said. Read Full Article…

HVBA Article Summary

1. Roche's Refined R&D Strategy: Roche has begun implementing a refined R&D strategy, emphasizing prioritization and the introduction of “the bar,” a set of five criteria that potential medicines must meet to remain in the portfolio. This includes fast-tracking high-priority programs, particularly in the obesity space, as part of their ongoing internal review process initiated since Q2 last year.

2. TIGIT Drug Tiragolumab Trial Closures: Following the Phase 3 failure of the SKYSCRAPER-06 trial, Roche decided to discontinue two additional tiragolumab studies, SKY-15 and SKY-05, in non-small cell lung cancer. The remaining tiragolumab trials are near completion or already fully enrolled, with no further major restructuring plans announced.

3. Pipeline Adjustments and Cuts: Roche has removed three early-stage candidates, including a gene therapy for Pompe disease and two cancer programs, from its pipeline. Additionally, they have decided not to pursue crovalimab for lupus nephritis, following recent strategic shifts and portfolio reassessments.

Navigating the maze: HR tech as your guide to benefits administration compliance

By Danika Kimball - The world of employee benefits administration can feel like a labyrinth of regulations and paperwork. Keeping pace with ever-evolving compliance requirements like HIPAA (Health Insurance Portability and Accountability Act), ACA (Affordable Care Act), and FMLA (Family and Medical Leave Act) can be a daunting task for HR departments, especially in today's complex business environment. Read Full Article…

HVBA Article Summary

1. Automated Compliance Monitoring: HR tech solutions offer automated compliance monitoring, helping organizations stay aligned with evolving regulations. These systems can flag potential compliance issues and provide alerts for necessary updates, ensuring that HR departments maintain compliance with federal and state laws, thus avoiding legal repercussions.

2. Streamlined Reporting and Audit Readiness: HR tech platforms streamline the reporting process by automating report generation and maintaining comprehensive audit trails. This functionality not only saves time but also reduces errors, making it easier for HR departments to prepare for audits and ensure accurate recordkeeping.

3. Data Security and Encryption: Prioritizing data security, HR tech solutions offer robust encryption and access control features. These measures protect sensitive employee information, ensuring compliance with data protection regulations like HIPAA, and provide a secure environment for managing employee benefits data.

Cigna sued for alleged CARES Act violations

By Emily Cousins - DoctorNow Inc., a diagnostic laboratory, claimed Cigna and Connecticut General Life Insurance failed to pay more than $5.7 million for COVID-19 testing in violation of the Coronavirus Aid, Relief and Economic Security Act, or CARES Act. Read Full Article…

HVBA Article Summary

1. Lawsuit Against Cigna Entities: The lawsuit filed by DoctorNow against Cigna Corp. and its affiliated companies in Los Angeles Superior Court alleges that under the Families First Coronavirus Response Act and the CARES Act, the defendants were required to fully cover and reimburse COVID-19 testing. However, they allegedly implemented policies to deny or underpay claims systematically.

2. Seeking Comprehensive Remedies: DoctorNow is seeking remedies including unpaid payments, an injunction to prevent future illegal practices, payment penalties, prejudgment interest, attorney fees, and punitive damages. The action emphasizes the need for addressing improper practices during public health emergencies and establishing a precedent for similar future situations.

3. Related Legal Precedents: Similar lawsuits have been filed by other medical providers against insurance companies in various jurisdictions, with some cases recognizing an implied private right of action under the FFCRA and CARES Act. These cases underscore the broader legal context in which DoctorNow's claims are situated.

Why women delay health screenings

By Erica Carbajal - While the majority of women recognize the importance of routine preventive health screenings, 43% say they have missed or delayed preventive screenings, including for cancer, according to a survey of 4,000 adult women in the U.S. cited by The Washington Post in a July 22 report. Read Full Article…

HVBA Article Summary

1. Importance of Health Screenings vs. Delays: According to a survey conducted by Gallup on behalf of Hologic, 90% of the 4,001 U.S. women surveyed believe health screenings are important. However, over 40% reported delaying recommended screenings for conditions like breast cancer, cervical cancer, and colorectal cancer, due to concerns such as anxiety about medical tests, fear of pain, affordability, or questioning the necessity of the screenings.

2. Role of Healthcare Provider Conversations: The survey revealed a correlation between discussions with healthcare providers and the likelihood of undergoing screenings. Women who had spoken with their healthcare providers about screenings were more likely to have been screened. However, these discussions are not consistent, as only about half of the respondents aged 35 and older reported having had conversations with healthcare professionals about screenings, with 45% following through with the screenings.

3. Health Systems' Efforts to Increase Screening Rates: In response to low screening rates, health systems have been enhancing their strategies to encourage preventive health screenings. These efforts include the introduction and expansion of mobile screening services and the use of technology to identify and notify high-risk patients about the appropriate timing for their screenings.

Why employers should offer an adoption savings plan

By Deanna Cuadra - Between years of paperwork and legal fees, parents who choose to adopt typically have an expensive and taxing journey ahead of them. But as employers expand their benefits into the fertility and child-care space, it seems like they're primed to make a difference for workers who want to adopt. Read Full Article…

HVBA Article Summary

1. High Costs of Adoption: Adoption can be financially burdensome, with expenses reaching upwards of $60,000, covering legal, agency, travel, and medical fees. This significant cost often makes adoption challenging for parents struggling with fertility issues or same-sex couples, who may see it as their only viable path to parenthood.

2. Limited Adoption Benefits: According to data from Maven Clinic and SHRM, only a quarter of companies offer adoption benefits, and just 35% provide paid parental leave for adoptive parents. This highlights a gap in employer-provided support for families pursuing adoption.

3. HSA Bank's Adoption Assistance Plan: HSA Bank has introduced an adoption assistance plan, allowing employees to save pre-tax dollars for adoption-related expenses. This plan, akin to a flexible spending account (FSA), offers immediate access to funds and can include employer contributions. Kevin Robertson, the chief revenue officer at HSA Bank, emphasizes its potential as an inclusive benefit that supports working parents and the LGBTQ+ community, while also enhancing the company's image as supportive and inclusive.