Catastrophic injury cases with expensive life care plans pose significant exposure issues to our clients. The Affordable Care Act guarantees consumers the right to purchase health insurance and caps annual out-of-pocket medical expenditure, thus limiting future medical care costs for plaintiffs. The enactment of the ACA should mean that future medical expenses are limited to the cost of the plan to the plaintiff. But, do the courts view the ACA as collateral source, meaning that the plaintiff can still recover all of the future medical costs, despite being covered by insurance?

Come to the DRI Medical Liability and Health Care Seminar at the Parc 55 Wyndham San Francisco, CA from March 13–15, 2015, and listen to the presentation by Victor A. Matheson, PhD and Jon Karraker, CPA discuss these issues and more. 

Resister today at; don’t forget to book your hotel room at the Parc 55 Wyndham.

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Is There A Doctor in the House?

Posted on March 7, 2014 03:41 by Patrick J. Kearns

The Patient Protection and Affordable Care Act, often referred to as the “Affordable Care Act” (ACA), or perhaps more commonly “Obama Care,” has had no shortage of media coverage and controversy since it was signed into law nearly four years ago (Yes, it has been 4 years! President Obama signed the Act into law on March 23, 2010).  Several aspects of the ACA have been, for better or worse, more “visible” than others; such as the heavy focus on the “individual mandate,” i.e. the requirement that uninsured citizens obtain health insurance or pay a penalty; the impact on employers and small businesses; and the more recent website debacle where many people seeking to sign up for health insurance on the newly created exchanges were unable to do so due to technical issues with the ACA’s website. 

One of the less discussed issues with the ACA however, is the potential for a massive provider shortage.  At its basic level, one of the primary purposes of the ACA is to increase the number of insured Americans. Indeed, according to various estimates, the implementation of the ACA is anticipated to provide insurance to 25-30 million additional individuals who would otherwise not be insured: “[T]he Affordable Care Act will also ensure that every American can access high-quality, affordable coverage, providing health insurance to nearly 30 million Americans who would otherwise be uninsured.” (Quoted from 2014 Funding Highlights bulletin published on Coupled with provisions providing for free or reduced cost annual exams; greater Medicare coverage; increased coverage for younger adults; and increased coverage for preventative care and testing such as mammograms and colonoscopies; that means more insured people utilizing more health care services. Consequently, the question arises of whether we have enough physicians and providers to administer the increased health care demands?  

The Obama administration has acknowledged this potential and recently proposed a Fiscal Year 2015 Budget for the Department of Health and Human Services which attempts to address this contingency, at least in part. According to the HHS’s “Fiscal Year 2015 Budget in Brief” “[t]he Budget makes new and strategic investments in our nation’s health care workforce to ensure rural communities and other underserved populations have access to doctors and other providers. In total, $14.6 billion will be invested in three key initiatives: $4 billion in expanded funding for the National Health Service Corps, $5.2 billion for a new Targeted Support for Graduate Medical Education program, and $5.4 billion for enhanced Medicaid reimbursements for primary care. (U.S. Dept. of HHS “Fiscal Year 2015 Budget in Brief”;

While the long-term idea behind the ACA may be to reduce health care costs and the need for excessive or increasing health care services (i.e. an insured population is presumably healthier and will therefore require less health care), will we have enough physicians, nurses, and other providers necessary to get us healthier in the short term? 

The full impact of the Affordable Care Act, positive or negative, remains to be seen. You can learn a great deal more about the Affordable Care Act, the difficulties with its implementation, and its impact on you and your practice, at DRI’s 2014 Medical Liability & Health Care Law Seminar, taking place in Las Vegas on March 20–21, 2014 at the Cosmopolitan Hotel.  Among many top-notch presentations at this year’s seminar you will not want to miss Kimber Lantry, Executive Vice President for AXIS Insurance’s Health Care Unit, give a fascinating presentation on “The Unintended Consequences of the Affordable Care Act.”

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On September 10, 2013, the Environmental Protection Agency (“EPA”) released draft rules titled “Standards of Performance for Greenhouse Gas Emissions from New Stationary Sources: Electric Utility Generating Units,” which for the first time proposes to set new carbon emission standards for newly constructed power plants. The new rule proposes to limit carbon dioxide (“CO2”) emissions from fossil fuel and natural gas fired power plants constructed after the rule goes into effect. It will only apply to power plants that sell more than one-third of their potential electric output and more than 219,000 megawatt-hours (“MWh”) net-electrical output to the grid on a three year rolling average basis. (EPA, “Regulatory Impact Analysis for the Proposed Standards of Performance for Greenhouse Gas Emissions for New Stationary Sources: Electric Utility Generating Units” p. 1-1) (“Regulatory Impact”).

Newly constructed fossil fuel fired power plants would have two options to comply with the proposed rule. They could limit their CO2 emissions to 1,100 lb CO2/MWh per year, or phase in the reductions over a seven year period if they can meet a rolling average of between 1,000 and 1,050 lb CO2/MWh per year. (Regulatory Impact, p. 1-3). In order to comply with the new standards, fossil fuel fired power plants would likely have to employ a technology known as carbon capture and sequestration (“CCS”) which “scrubs carbon dioxide from their emissions before they reach the plant smokestacks. The EPA predicts that the proposed rule will provide an incentive for the research and development of this new technology that will lead to greater CO2 emission reduction and more cost effective technology. (Regulatory Impact, p. 1-3, 1-4)

New natural gas power plants also would have two options.  If a plant had a heat input rating greater than 850 million British Thermal Units per hour (“MMBTU/hr”), it would have to limit its emissions to 1,000 lb CO2/MWh per year. If the plant had a heat input rating less than 850 MMBTU/hr, it would have to limit its emissions to 1,100 lb CO2/MWh per year. According to EPA, existing natural gas power plants would be able to satisfy the proposed standard without adding new technology. (Regulatory Impact, p. 1-3).

EPA projects that the proposed regulation will have a negligible economic impact. It concludes that even without the proposed rule, no new coal fired plants would be built over the next eight years without CCS technology in place. In addition, it projects that market factors have made non-coal energy sources such as natural gas and renewable resources the technology of choice for new generating capacity. Consequently, EPA predicts that companies will choose to build new natural gas power plants in place of coal power plants for the foreseeable future. (Regulatory Impact, p. 2-3).

The proposed rule will soon face a 60-day public comment period which commences once the rule is published in the Federal Register. There will also be a public hearing on the proposed rule at an undetermined date. Extensive public comment is expected.  The proposed rule is actually a revision and rescission of a rule previously proposed on April 20, 2012, which received over 2.5 million comments, the most comments ever made on an EPA rule proposal. (Regulatory Impact, p. 1-3, 1-4). 

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Obamacare & the Insurance Broker

Posted on August 7, 2013 03:22 by Marc Zimet

The Patient Protection and Affordable Care Act, otherwise known as “Obamacare,” is scheduled to go into effect on January 1, 2014. Once in effect, it will drastically alter the manner in which health insurance is purchased and brokered in California. To comply with the Act, California is required to establish a health insurance exchange, allowing individuals and small businesses to purchase health insurance at competitive rates. This exchange is set to begin operation January 1, 2014. In order for brokers to participate in the exchange, they must first prove compliance with new federal and state rules and regulations.

California has been actively working towards creating new rules and regulations which will govern how brokers operate in the state. However, it appears that while federal law has its own set of regulations, California may be on its way towards creating stricter and more rigid regulations, placing a higher burden on the broker.

Obamacare has created different roles for brokers by which they may participate in the exchange: they may enroll as a “Navigator” or “Assister.” To enroll, it is most likely that brokers will be required to complete a short training and pass a certification test. Navigators will assist consumers in applying for health insurance and will receive compensation directly from the exchange for individuals they enroll. They do not have to be licensed agents or brokers. According to the National Association of Health Underwriters, this designation is not without its problems. It claims the distinction between advising clients regarding qualified health plans and simply aiding clients through the enrollment and eligibility process is unclear and, furthermore, it is not known how this distinction will be overseen and enforced. Additionally, there are no guidelines in place requiring Navigators to inform clients of non-exchange insurance plans, and the likelihood of fraud in this area is high.

Assisters are more akin to the traditional insurance broker and must, in fact, be licensed. An Assister will receive payment from third party health insurance carriers for enrolling individuals in the exchange. While a broker may choose to enroll as either a Navigator or Assister, if one chooses to enroll as a Navigator, one will be subject to compensation constraints and may only receive compensation directly from the exchange.

In addition to the new roles for brokers, the Act will only permit “qualified health plans” to be sold on the exchange, which must comply with federal and state rules. For example, federal law requires that such policies cover ten “essential health benefits” such a hospital stays, maternity care, pediatric care, and dental and vision. Federal law, in attempt to create more flexibility, excepts state exchanges from including dental coverage for children so long as it offers at least one pediatric dental plan. However, California has chosen to deny insurers the ability to combine medical and dental policies, requiring them to be offered separately; only one plan combining medical and pediatric dental has been approved. Any broker who chooses to participate in the exchange may sell policies outside of the exchange, on the condition that all policies be qualified health plans.

The date the new laws take effect is fast approaching. Brokers should utilize the remaining months to familiarize themselves with the minimum requirements for qualified health plans, as well as the compensation limits for Navigators and Assisters. The health insurance industry is changing quickly with brokers at the heart of the change. It is imperative for brokers to understand the changes about to occur so that they can not only stay abreast of the changes in their practice, but ensure compliance with the new rules and regulations.

This blog was originally posted on August 6 on Jampol Zimet's Insurance Defense Blog. Click here to read Marc Zimet's original post. 

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Categories: Health Care Law | Insurance Law

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Last month, the Equal Employment Opportunity Commission (EEOC) settled its first lawsuit under the Genetic Information Nondiscrimination Act (GINA). GINA was enacted in 2008 and took effect in 2009. It prohibits an employer from using genetic information to make employment decisions, including decisions related to the hiring, firing, promotion, pay, job assignments, training, and benefits of its employees.

The suit arose when Fabricut, a large fabric distributor, asked a temporary employee applying for a full time position to disclose her family medical history in a post-job-offer physical exam. At her physical, the employee was required to complete a questionnaire, which included questions related to her family history of specific medical disorders, including heart disease, hypertension, cancer, tuberculosis, diabetes, arthritis, and “mental disorders.”

The EEOC alleged in the suit that because the questionnaire requested the employee’s family medical history, a GINA violation had occurred. The suit was settled for $50,000 and Fabricut agreed to take actions designed to prevent future discrimination. The EEOC stated that once Fabricut was aware of the violations, it took action to remedy the situation and worked with the EEOC to reach a settlement.

David Lopez, general counsel of the EEOC stated, “Employers needs to be aware that GINA prohibits requesting family medical history. When illegal questions are required as part of the hiring process, the EEOC will be vigilant to ensure that no one be denied a job on a prohibited basis.” EEOC Regional Attorney Barbara Seely further noted that despite the fact that GINA has been law since 2009, “many employers still do not understand that requesting family medical history, even though a contract medical examiner violates this law.” The EEOC has stated that addressing emerging issues in the employment field, such as genetic discrimination, is one of the six national priorities identified in EEOC’s Strategic Enforcement Plan for 2013-2016.

The fact that GINA is a relatively new law applying to employers means that employers need to be proactive in educating management and employees regarding the law’s prohibitions to ensure that violations aren’t inadvertently made. The case of Fabricut serves as a reminder to employers who are unaware of GINA’s implications that is important to stay concurrent with laws that apply to an employer’s conduct to ensure that no violations, whether intentional or not, are made.

This blog was originally posted on Jampol Zimet's Insurance Defense Blog on June 20. Click here to see the original post. 

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Categories: Discrimination | Health Care Law

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Plaintiff Susan Early was allegedly injured while a passenger on one of Carnival Corporation’s ships.  A claim was initiated, then (apparently) resolved.  The mediator in the matter filed his report on November 21, 2012.  That report stated that the parties had settled subject to the condition that the Court retain jurisdiction to enforce the terms of the settlement and determine the issue of a possible LMSA if one were needed.  Early motioned the Court for Determination of Whether a Medicare Set Aside is Required.  The terms of the settlement negotiations were:

1) Carnival will pay Early an undisclosed sum;
2) Each party will pay its own attorney’s fees and costs;
3) Early will execute a release for Carnival;
4) Carnival will be responsible for the mediator’s fees; and 
5) The parties DISAGREE on whether an LMSA was required, but agree to submit the issue to the Court and to abide by its determination.

Early’s motion argued that an LMSA was not required under the Medicare Secondary Payer (“MSP”) Act.   Carnival filed its response, urging the Court to conclude that an LMSA was required.

The Court begins by providing a succinct recitation of the MSP Act. Then, the Court describes how MSA analysis has emerged as means to address the future medicals issue.   After detailing what actually constitutes a settlement in Florida, the Court turns to the question of whether the parties have an agreement to settle the claim.  
The Court concludes that the parties agreed on four out of five essential terms.  The term the parties could not agree upon was the LMSA issue, and asked the Court to fill in the blank on their behalf.  The Court declined the opportunity to do so.  
The Court distinguished this fact pattern from two others which appear routinely in other opinions addressing LMSA issues: 1) cases where the parties have a settlement agreement and agree that an LMSA is required, but cannot obtain review and approval of the LMSA from the Centers for Medicare & Medicaid Services (“CMS”); and 2) cases where the parties have a settlement agreement but disagree as to whether those terms included the creation of an MSA.  Here, the parties did not ask the Court to enforce a settlement agreement; they asked the Court to assist with a critical term of a potential settlement agreement.  While the Court noted the “conscientious and diligent” efforts of counsel to uncover the issue, it was not within the Court’s dominion to gap fill with respect to this essential term of the potential settlement agreement.  

This case is another example of the LMSA issue derailing what is (otherwise) a perfectly acceptable settlement agreement.  These issues should become much less obtrusive after CMS issues final guidance about liability settlements and future medical expenses under the MSP Act.  That guidance is expected to be released later this year.  Until then, the best approach is to proactively address the issue, and evidence exactly how you have arrived at your conclusion on the future medicals issue.  That approach, coupled with the Court’s conclusion in Guidry v. Chevron , highlights the importance of utilizing a formalized approach to MSP compliance.  When addressing future medicals issues under the MSP Act, a formalized approach will yield complaint results every time.    
Having a formalized settlement process that integrates these core concepts will achieve efficiencies and enhance the effectiveness of settlement programs while ensuring closure on the file.  Such a formalized settlement process should take into account the timing and coordination issues which may hinder successful LMSA analysis.  Thus, screening a case up front to verify entitlement and identifying a claimant as an MSA candidate early on is the proper launching point for any LMSA analysis.  As parties move towards resolution and identify the prospective gross award, they can then determine (consistent with CMS’s basic rules issued in the workers’ compensation settling) if a future medical allocation exists within the gross award, either in the form of a specific carve out or implicitly contained within the one undifferentiated lump sum.  

The DRI MSP Task Force continues to track relevant judicial opinions and guidance from CMS in order to ensure compliance for you and your clients.  We continue to stress the importance of utilizing a formalized approach in addressing the LMSA issue on every single claim, as that process will, in and of itself, ensuring compliance on the LMSA issue. 

[1] Early v. Carnival Corporation, No. 12-20478-CIV-Goodman (S.D. Fla. February 7, 2013).

[2] 42 U.S.C. §1395y(b)(2).

[3] The Court cites to a recent article published by the American Bar Association which was co-authored by John V. Cattie, Jr., DRI MSP Task Force Vice Chair.  See also Medicare Set-Aside Arrangements Under the Medicare Secondary Payer Act, 42 The Brief, n. 10, Fall 2012.


[4] Guidry, et al. v. Chevron USA, Inc., Civ. No. 6:10-cv-00868, 2011 U.S. Dist. LEXIS 148942 (W.D. La. December 28, 2011).  



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Harvard University and the National Football League Players Association (“NFLPA”) are negotiating a deal with the NFL seeking a $100 million grant for the purpose of studying, diagnosing, and treating injuries and ailments suffered by players as a result of their football careers.

Dr. Lee Nadler, the Harvard Medical School Dean for clinical and translational research, attested to the groundbreaking nature of the proposed project, noting “[n]o one has ever studied the players [themselves] before.  There have been postmortem studies looking at the brains of previous players but not the players today.”

One has to wonder how generous the NFL will continue to be – after all, the league just donated $30 million to the National Institutes of Health last year to study brain injuries in NFL alumni.  Still, proponents of the Harvard study made sure to stress that this would not be simply another concussion study; instead, it would consider a whole host of health ailments potentially facing former NFL players  including chronic pain, depression, heart problems, and diabetes.  The scope of the proposed research is beyond anything that has been conducted to this point – preliminary estimates called for a nation-wide group of 200 NFL alumni drawn from a 1,000 person study group, with all participants being subject a wide array of medical tests.

Dr. Herman Taylor, one of the non-Harvard medical professionals retained for the study, stated, “Typically, when we do a test or medical study, we’re taking a snapshot.  What we want to do is see the full-length movie of what happens to a player over time.”

On the issue of funding, NFLPA Executive George Atallah noted, “Given the scope of health issues that NFL players are subject to, we are committed to making sure that enough money is allocated to get answers.”  However, because the research will be funded by a portion of league revenues, the actual amount the NFL is willing to put towards the study will likely not be determined until after the Super Bowl.

As originally published at on January 31, 2013
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On October 31, 2012, lawyers representing thousands of former NFL players filed an opposition brief to the NFL’s current motion to dismiss pending in U.S. District Court in Pennsylvania, insisting that based on the gravity of the harm incurred, their lawsuit against the League must be allowed to move forward.  The brief rejected the NFL’s contention that the action was essentially a labor dispute that needed to be resolved under the league’s collective bargaining agreement.

The Plaintiffs accused the NFL of “orchestrat[ing] a disinformation campaign,” insisting that the League “knew that players were exposed to risks of severe neurological injuries yet did nothing to prevent them.”  However, the League has, time and again, publicly denied that it knew of any long-term dangers posed by concussions.  Further, the NFL insists that it did not intentionally lie to players about the potential side effects.  Instead, it stated that it delegated the decisions about players’ conditions and return-to-play decisions to individual team doctors and trainers.

At this point, U.S. District Judge Anita Brody must decide how to proceed with the extremely cumbersome litigation.  If a settlement is not reached and the case is not dismissed, it is possible that the individual cases could be returned to the multiple districts where they originated forcing the parties to proceed with separate trials.

Ex-players reply to NFL’s motion to dismiss cases

As orrignally posted on Sports Law Insider on November 14, 2012
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Affordable Care Act Upheld

Posted on June 28, 2012 06:14 by Marc E. Williams

This morning the Supreme Court issued its long–awaited decision on the constitutionality of the Patient Protection and Affordable Care Act. The Court upheld the most important feature of the act, the individual mandate, which requires that individuals not covered by health insurance buy coverage or face a “shared responsibility payment.” This mandate was critical to the success of the Act, since the availability of affordable coverage for the millions of uninsured Americans required a large pool of customers. In reviewing the authority of Congress to require this mandate, the Court found that it falls within the taxing power of Article I, Section 8 of the Constitution. The Court also noted that the individual mandate was not an appropriate exercise of Congressional power under the Commerce Clause or the Necessary and Proper Clause. Writing for a plurality of justices, Chief Justice Roberts noted that the questions of the soundness of the policy is not an issue for the court to consider, but only to decide whether it is an appropriate exercise of Congressional authority. Ultimately the Court found that the mandate’s imposition of a penalty for failing to purchase insurance was not commerce that could be regulated by Congress, but would fall within its taxing power. In finding that the mandate was a tax, the Court adopted the position of the Solicitor General, and guaranteed that the issue will continue to resonate in political debates through the November election.

A separate part of the decision considered the constitutionality of a provision of the Act that expanded Medicaid coverage to millions of new individuals. As a result, states were required to adopt new eligibility requirements or risk losing all of its Medicaid funding. The coercive nature of this requirement was the critical feature of the review of this portion of the Act. A complicated plurality of justices held that the expansion was unconstitutionally coercive, but that the remedy for this violation is to strike down the provision allowing the federal government to withhold all Medicaid funds unless a state agrees to the expansion. Accordingly, states that do not agree to the expansion will only lose new Medicaid funding.

For a complete copy of the opinions, see this link:

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Socrates said the obligation of judges is to “Hear courteously, Consider seriously, Decide Impartially.” And that appears to be what the United States Supreme Court is doing as it considers a series of related issues raised by numerous challenges to the Patient Protection and Affordable Care Act including one predicated on the Anti-Injunction Act. The Court expanded the time for argument, offering the lawyers for the parties and several lawyers appointed to argue positions that neither party had advanced time to present their positions and answer questions for three days. In the course of those days of argument, the justices asked thoughtful questions probing the basis for each party’s position, the limits to their proposed rules of law, and the grounding for their position in statutory and constitutional law as well as the Court’s past precedent. Anyone watching the argument, or reading the transcript, or listening to the audio tapes would conclude that the issues presented are difficult and that the Court has listened courteously to all viewpoints and is considering seriously its decision. In fact, the process has been a tribute to the Court and seems to me likely to enhance the Court’s status as a revered American institution if the ultimate decision, and any dissent, is written in a manner that conveys impartiality. 

Television, radio, newspapers, and the blogosphere are filled with discussion – and the media seems a veritable school for the public about some complex issues.  Discussions focus on the connection between the individual mandate and the community-rating provision and the guaranteed-issue provision, federalism and state versus federal powers, the commerce clause, court-watching and speculation about the outcome of the decision, and presidential politics and the impact of any ruling on the election next fall. With so much prognostication going on about the outcome, I will keep my prediction to myself. But I will say that the parties were uniformly represented by capable and articulate advocates, and the Court focused on key points that it will need to consider in reaching its decision. I hope that when any decision – or set of decisions – issues, the justices will use care in their language to avoid any suggestion that disagreements are due to partisan differences, rather than differences in how the justices view the legal issues. 

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Categories: Health Care Law | Supreme Court

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