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Valparaiso Univ. Law School

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Friday, November 26, 2004

Hospitals can pursue contract claims against ERISA plans

Hospital Representatives of health care providers are pleased by a recent ruling that they can pursue their contract claims against non-paying and slow-paying employee benefit funds, ERISA notwithstanding.  A federal appeals court ruling permitted Pascack Valley (N.J.) Hospital (left) to pursue its breach of contract actions in state court against the United Food and Commercial Workers International Union Local 464-A Welfare Reimbursement Plan.

There have been chronic problems with failure to pay by managed care plans, including union benefit plans. "We've always looked at these plans as being untouchable when it comes to collecting past due payments;" said the hospital’s lawyer, Keith McMurdy, quoted in the Newark Star-Ledger. "We hope this will make it easier for hospitals to collect and cut down on uncovered medical bills."

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