Vermont-NEA News

Senate Gives Nod to TPA Regulation

MONTPELIER – The Senate today gave preliminary approval of a measure that would for the first time regulate so-called third-party administrators, the firms that handle Vermonters’ health reimbursement arrangements, health spending accounts and flexible spending accounts.

The measure, supported by the state’s largest union as well as the administration of Gov. Phil Scott, emerged a year after thousands of educators’ medical claims and spending accounts were mishandled in the wake of new health insurance plans that went into effect on Jan. 1, 2018. 

Many of those educators are still sifting through the chaos wrought by the failure of third-party administrators to properly process claims and reimbursements. Many educators and their families avoided medical procedures, left prescriptions unfilled, and were refused care because of unpaid bills. Some were also threatened with collection agencies because of the unpaid bills.

“We are grateful for today’s vote,” said Don Tinney, a high school English teacher who serves as president of Vermont-NEA. “If enacted into law, this measure will go a long way to preventing a repeat of what happened to our members and their families as well as give aggrieved Vermonters a place to go for complaints and relief.”

Late last year, 30 local education associations sued one such third-party administrator, Future Planning Associates. The suit alleges that Future Planning committed consumer fraud and breach of contract. The firm handled health savings accounts, flexible spending accounts, and health reimbursement arrangements for more than 70 percent of school districts before abruptly pulling out of the business months later.

The bi-partisan bill, originally introduced by Senators Christopher Bray, Becca Balint, Phil Baruth, Joe Benning, Brian Campion, and Debbie Ingram, would call for the Department of Financial Regulation to develop regulations for third-party administrators by Sept. 1, 2020 that would go into effect on Jan. 1, 2021.

Those companies administer millions of dollars belonging to Vermonters and their employers. Without regulation, Vermont consumers, employers, and the state have no recourse to ensure that these firms administer benefits properly.

“Working with educators, lawmakers, and the administration, we are hopeful that this measure continues to have widespread support,” Tinney said. “No Vermonter should ever have to experience the frustration, confusion, and havoc that thousands of my fellow members suffered through in the last year.”

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Darren Allen Mar 13 2019
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