Employee Benefit Plan Assignment Key to Health Provider Paydays

The law on whether hospitals and other health providers can seek compensation from insurers on behalf of patients is in flux.

As ERISA-governed plans have adopted “anti-assignment” clauses that prevent patients from allowing providers to collect insurance benefits on their behalf, attorneys have found creative work-arounds to allow litigation to go forward.

According to the American Hospital Association, hospitals forewent $38.3 billion in payments for services in 2016. This uncompensated care includes both charity care for patients with financial need and bad debt that is considered uncollectable from patients.

The assignability of benefits under Employee Retirement Income Security Act plans ...