Subrogation is one of the most complex legal areas in American jurisprudence.  Not only does subrogation involve extremely challenging and ever-changing questions of state and federal law depending on the applicable plan type and location, it requires critical thinking and excellent negotiation skills in order to yield the best outcome for the plan.  

In choosing an outside subrogation attorney, you want someone who routinely makes the tough arguments, has the litigation experience and skills, and knows the law in this area better than anyone in the country.  You want attorneys who can make the right argument at the right time, and who are available at a moment’s notice.  

Imagine a telephone call during a mediation when everything is tense and all the parties are on edge because the large subrogation lien is the reason the case may not settle.  This scenario must be handled the right way, with the right amount of aggressive negotiation, but with a mind toward resolution.  

Here, knowing the law and having the right experience during this important telephone call is the key difference between a great recovery and one that will have to be explained later.  This is something our clients have always appreciated about our firm and is why some of the largest health plans in the country choose Russell, Oliver & Stephens as its go-to subrogation firm.  

The ROS Way is the best way!

ROS represents employers of all sizes—from Fortune 500 corporations to smaller, locally owned businesses—in labor and employment law matters.  Our attorneys have decades of experience with Title VII of the Civil Rights Act of 1964, the Americans With Disabilities Act, the Age Discrimination in Employment Act, the Employee Retirement Income Security Act, the Fair Labor Standards Act, and numerous other federal and state employment laws.      

Our firm offers proactive risk assessment and advice to in-house attorneys, HR professionals, and business managers to help them avoid, where possible, costly employment claims.  Our knowledge of the myriad labor and employment laws enables us to promptly evaluate and advise on all workplace issues.  We also draft employee handbooks and conduct internal investigations for companies’ HR Departments.     

Many employee disputes inevitably lead to legal claims before the Equal Employment Opportunity Commission (EEOC) and/or federal and state courts.  Over the past 21 years, our firm has defended thousands of administrative charges before the EEOC and other administrative agencies in all 50 states.  We also have successfully represented our clients in trials and on appeals in federal and state courts throughout the United States.      

ROS prides itself on providing the highest quality legal services at a significantly lower cost than larger law firms can provide.  For litigation, we offer highly competitive, cost-effective hourly rates.  We also achieve significant savings for our clients by offering alternative billing arrangements.  We defend EEOC charges and conduct HR investigations on a flat-fee basis, thereby containing legal costs for our clients.  Our clients appreciate the cost certainty our firm provides.

At ROS, we represent employers, retirement plans, plan fiduciaries, and administrators in litigation related to employee benefits.  This includes defending ERISA claims, bringing claims on behalf of plan fiduciaries, reviewing and defending benefit claim determinations, and seeking reimbursement of benefits paid by the plan.  Unlike other law firms, ROS is an industry leader in subrogation and reimbursement matters.  This informs our approach to handling employee benefits matters and allows us to deliver superior legal services and experience at a substantially lower fee than other law firms.

ERISA

The Employee Retirement Income Security Act of 1974 (ERISA) is a complex federal law governing voluntarily established retirement and health plans in private industry.  ERISA does not typically govern governmental, church, worker’s compensation, and unemployment plans.

Member attorneys routinely seek proof that a plan is covered by ERISA when resolving an ERISA plan’s subrogation lien.  Member attorneys request copies of a plan's Form 5500, ask if the plan at issue is “ERISA qualified” and inquire about whether the plan “complies with ERISA,” has “stop-loss” insurance, and the like. 

As discussed below, one of the biggest errors made by these attorneys, and even seasoned subrogation professionals, is assuming that an insured health plan is not ERISA-covered.  Many attorneys do not know that welfare benefit and pension plans are treated differently under ERISA.  Only pension plans are required to be “qualified.”  Employers have a significant amount of freedom when setting up welfare-benefit plans.

Under ERISA, an “Employee Welfare Benefit Plan” means:

"Any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise (a) medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, disability, death or unemployment . . . ."

29 U.S.C. § 1002(1). 

The definition can be broken down into five elements: (1) a “plan, fund, or program” (2) established or maintained (3) by an employer (4) for the purpose of providing health care or disability benefits (5) to participants or their beneficiaries.

The exceptions to ERISA-coverage are (1) church plans, (2) school plans, (3) governmental plans, (4) individual plans, (5) worker’s compensation plans, and (6) plans -- like AFLAC coverage -- that are not “sponsored” by the employer and therefore fall within ERISA’s safe-harbor provision.  The upshot is that a plan is likely ERISA covered—whether insured or self-funded—if the plan is employer-sponsored and does not fall within one of the above exceptions.

ERISA-covered plans are unique because they may not be subject to state laws.  Depending on whether the plan is self-funded or insured, an adverse subrogation law being asserted by a member’s attorney to reduce or eliminate the ERISA plan’s lien may or may not control.  Whose law controls is a crucial, but often complex, question that effects the outcome of every ERISA subrogation case.   

At ROS, we know the answer to this question on every case and we have the knowledge and experience to obtain the best recovery for our client in each situation.

Non-ERISA

Many health plans do not fall under the Employee Retirement Income Security Act of 1974 (ERISA) as discussed above.  For example, governmental health plans, such as those sponsored by cities, counties, special school districts, and the state, are not covered by ERISA.  Although state law will control these plans, some states have enacted laws that protect governmental health plans seeking subrogation and reimbursement from tort cases.  In other words, some governmental plans will be immune from the applicability of the made-whole rule, for example.

Knowing the specific state law that governs subrogation and reimbursement in each state is vital.  At ROS, we use our extensive experience and knowledge of state law to determine the best course of action for our clients, and we don't back down when it comes to handling problem-type cases involving non-ERISA health plans.

The Federal Employees Health Benefits Act (“FEHBA”), 5 U.S.C. § 8901 et. seq., governs health benefits provided to federal employees, such as politicians, federal judges, heads of federal government, postal workers, and federal law enforcement, among others.  There are approximately 8.2 million people covered by FEHBA plans.    

The most common issue regarding subrogation and reimbursement of a FEHBA-covered plan is whether FEHBA preempts a particular state’s adverse subrogation law. 

In Coventry Health Care of Missouri, Inc. v. Nevils (2017), the U.S. Supreme Court directly addressed whether the FEHBA preempts state laws that prevent carriers from seeking subrogation or reimbursement pursuant to their FEHBA contracts. 

In the Opinion by Justice Ginsberg, the Court held that FEHBA preempts state laws, and the Plan’s contractual terms are enforceable nationwide.  Here, the Court stated that “FEHBA concerns ‘benefits from a federal health insurance plan for federal employees that arise from a federal law’ in an area with a ‘long history of federal involvement.’” 

At ROS, our attorneys are well-versed in handling FEHBA subrogation matters nationwide.  Our extensive knowledge and experience in this area is the reason for our unmatched results.

The rights and obligations of health plans and their participants are set forth in the plan’s written documents.  Many health plans rely upon a single document, called a summary plan description (“SPD”), to set out the plan terms.  Under ERISA, the governing plan document must include certain information such as:  (1) plan funding; (2) allocation of responsibility for the administration and operation of the plan; (3) the procedure to amend the plan; and (4) information about how the plan pays benefits.   Having the right plan language is imperative to maximize the plan’s recoveries.  At ROS, we draft and develop plan language and documents for our clients that contain strong, enforceable subrogation language to ensure the plan can maximize recoveries under controlling law.  Our draft language is tailored to specific lines of business (ERISA (self-funded and insured), FEHBA, insured non-ERISA, self-funded non-ERISA) and by state to make sure that the draft language complies with applicable federal, state, and local laws and regulations.  Because we helped create the law upon which many of our competitors rely, we know what language can make or break a subrogation case.

ROS attorneys counsel employers on all aspects of employer-employee relations, having extensive experience with the numerous laws governing civil rights, discrimination, family & medical leave, and disabilities. We place specific emphasis on litigation avoidance through client counseling as well as conducting in-house seminars and training for clients to ensure compliance with employment-related laws and regulations. We also litigate nationally for employers before state and federal courts and governmental agencies.

At ROS, we offer an effective overflow program that serves as an extension of our clients’ internal subrogation and other party liability units to assist with health plan subrogation and reimbursement recovery services.  Our clients use our flexible overflow program to control rapidly increasing internal case counts without having to hire additional team members and to ensure that plan assets are protected.  Our overflow team members are extensively trained to follow the internal policies and procedures of our clients and to ensure that services are performed at the highest level.

ROS OVERFLOW TEAM PROCESS:

• Reviews files in the investigation stage opened through various forms of contact and research
• Opens files where third-party liability is determined and places all interested parties on notice of the lien
• Assesses plan documents and pursues recovery based on plan language and applicable state/federal law
• Responds to subpoenas duces tecum and records requests
• Monitors status of case with member’s attorneys and insurance companies
• Confirms limits of PIP and Med-Pay coverage and seeks recovery of those benefits if not exhausted
• Builds and updates itemizations
• Pursues overpayments from providers when applicable
• Negotiates and settles liens with member’s attorneys and insurance companies
• ROS attorneys provide oversight and handle lien negotiation as needed