Erin Sweeney Comments on Implications of Montanile on Health Benefit Plans in Employee Benefit News

”What employers need to know about the Montanile case"
Employee Benefit News
01.22.16Erin Sweeney commented on implications of the Supreme Court's ruling in Montanile v. Board of Trustees of the National Elevator Industry Health Benefit Plan on medical benefit plans, pensions and profit sharing plans. Even though the Court acknowledged that the participant had a legal obligation to repay the health benefit plan, the Court ruled that under ERISA, the health plan did not have a right to attach Montanile's general assets. "This is now going to be a race for the participant to try to dissipate these assets, and the plans are going to have to develop a whole new line of business of monitoring and investigating these pieces of litigation and whether they are going to intervene on a routine matter or file injunctive actions or their own declaratory actions as soon as they have a participant who might have some third-party claim," Sweeney said. "It puts plans in a place where they are now going to have to dedicate resources that the plans would prefer to pay benefits with." Sweeney added that even if the plan participant knowingly didn't tell the plan it reached a settlement and spent the assets, "as long as what they bought with the dollars [constitutes] non-traceable assets -- food, clothing, travel -- as long as the plan participant bought [assets] with non-traceable dollars, the plan can’t get those dollars."
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