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Twice-Weekly Briefing
Tuesday, August 25, 2026
Issue 260825-57
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The MOC Brief
Health policy, priced and translated for self-funded plan sponsors
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In This Edition
Five developments from the past two weeks, and the document in your files that each one turns on.
| 1. | Two circuits split on whether a TPA's verification call is your liability | | 2. | A self-funded employer's fiduciary case against its own TPA survives dismissal | | 3. | The FTC says buying patent applications is reachable under antitrust law | | 4. | Only 28 percent of employees feel ready for an unexpected $1,000 expense | | 5. | HHS opens comment on the vaccine categories behind first-dollar coverage |
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| 1 · PLAN LIABILITY · August 19, 2026 |
| Two Appeals Courts Split Eight Days Apart on Whether a TPA's Phone Call Creates State Law Liability |
| The Sixth Circuit ruled on August 19 in Laurel Hill Management Services v. La-Z-Boy, No. 25-1727, that ERISA preempts negligent misrepresentation and promissory estoppel claims brought by out-of-network providers over what a plan administrator says on the phone about coverage. The providers billed $342,296 for one patient and were paid $1,598.40 after Blue Cross Blue Shield of Michigan staff orally stated that reimbursement would follow usual, customary, and reasonable rates. Eight days earlier, on August 11, the Ninth Circuit reached the opposite result in Healthcare Ally Management of California v. WSP USA and Aetna, No. 24-3479, holding that ERISA does not preempt the negligent misrepresentation claim while it does preempt promissory estoppel. In that case the provider was paid at the Medicare rate, which the court said amounted to five percent of the bill. Judge Murphy's concurrence in the Sixth Circuit case calls the governing precedent an outlier and points to decisions from other circuits that decline preemption of similar claims. |
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MOC Perspective
The same unrecorded phone call is now a live state law tort in the nine states of the Ninth Circuit and a dead letter in the four states of the Sixth. If your workforce spans both, you are running one plan under two liability rules, and your plan name sits in the caption either way. The control points are your TPA's verification script, whether it records and retains those calls, and the indemnification language in your administrative services agreement. A split this clean is how a question reaches the Supreme Court.
What to do now
| ▪ | Require your TPA to confirm in writing within 30 days whether benefit verification calls are recorded and how long the recordings are kept. | | ▪ | Read the indemnification clause in that agreement and confirm it reaches state law claims ERISA does not preempt. | | ▪ | Map your covered lives by state and flag the members sitting in Ninth Circuit jurisdictions, where a verification call now carries tort exposure. |
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| Source: U.S. Court of Appeals for the Sixth Circuit |
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| 2 · TPA ACCOUNTABILITY · August 13, 2026 |
| A Court Lets a Self-Funded Employer Sue Its Own TPA Over Nearly 5,000 Duplicate Claims |
| Judge Gerald Pappert of the Eastern District of Pennsylvania ruled on August 13 in Aramark Services v. QCC Insurance Company, No. 26-1664, that Aramark's fiduciary breach and prohibited transaction claims may proceed against QCC, which does business as Independence Administrators. Aramark self-funds two health plans, both with more than $600 million in assets, and paid QCC to review, pay, and deny claims under an administrative services agreement. The complaint alleges nearly 5,000 duplicate claims; 2,300 claims for services the plans expressly excluded; 1,253 improper, false or fraudulent claims; and $2,380,000 drawn as advance funding. The court found QCC plausibly acted as an ERISA fiduciary on three separate grounds: the 2018 agreement named it the claims fiduciary, it held final discretionary authority over benefit determinations, and it had sole authority to sign checks on the plan account. Counts I through IV proceed against QCC. The plans and the two Independence parent entities were dismissed without prejudice, and Aramark may file an amended complaint on or before September 11. |
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MOC Perspective
This is the sponsor as plaintiff, and it now has a written opinion behind it. Check-signing authority on the plan account and final discretionary authority over claims are two of the three grounds that made QCC a fiduciary, and both sit in most administrative services agreements as boilerplate. A $2,380,000 advance funding draw is the kind of line that clears an invoice review every quarter because nobody opens the fee schedule.
What to do now
| ▪ | Pull your administrative services agreement and mark every clause granting your TPA discretionary claims authority or signature authority on the plan account. | | ▪ | Commission a duplicate claim and excluded service audit on your last 24 months of paid claims, and confirm your contract gives you the data access to run it. | | ▪ | Reconcile every dollar your TPA drew from plan assets in 2025 against its disclosed fee schedule under ERISA Section 408(b)(2). |
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| Source: U.S. District Court for the Eastern District of Pennsylvania |
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| 3 · DRUG COMPETITION · August 21, 2026 |
| The FTC Tells the Fourth Circuit That Buying Patent Applications Is Reachable Under Antitrust Law |
| The Federal Trade Commission announced on August 21 that it had filed an amicus brief in CareFirst of Maryland v. Amgen, an appeal now before the Fourth Circuit. The brief was filed August 20 in support of neither party. The plaintiffs are health plans, not the government, and they allege that Amgen acquired exclusive rights to pending patent applications and shaped them to cover Enbrel, extending its monopoly and keeping lower-cost competitors out of the market. The FTC argues that acquisitions of patent applications are subject to antitrust scrutiny under Section 2 of the Sherman Act, and that Noerr-Pennington immunity does not extend to private commercial transactions. The Commission voted 2 to 0 to file. The announcement carries no dollar figures. |
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MOC Perspective
Your specialty spend is set as much by patent strategy as by rebate negotiation, and this appeal tests whether a plan can reach that. The FTC takes no side on the merits, only on whether the conduct can be reviewed at all, which is the question that decides whether the case survives. Health plans brought this one themselves, which is what a purchaser holding a fiduciary duty does with an overcharge instead of absorbing it into next year's trend.
What to do now
| ▪ | List every biologic in your top ten drug spend that has an FDA approved competitor you cannot actually buy, and ask your PBM in writing why. | | ▪ | Add a clause at your next PBM renewal preserving your plan's right to participate in antitrust recoveries on drugs it purchased. | | ▪ | Require quarterly reporting of net plan cost per biologic so you hold the purchase record any future claim would need. |
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| Source: Federal Trade Commission |
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| 4 · MEMBER AFFORDABILITY · August 24, 2026 |
| Only 28 Percent of Employees Say They Are Ready for an Unexpected $1,000 Expense |
| EBRI and Lincoln Financial published Issue Brief No. 663 on August 20 and released a companion set of findings on August 24. The survey reached 1,130 benefits-eligible employees and was fielded in October 2025. Fifty-seven percent of those employees have delayed medical care because of cost, and 26 percent delayed within the past year alone. Only 34 percent said they were very prepared for an unexpected $500 expense, 28 percent for $1,000, and 21 percent for $5,000. Among those with a recent medical event, 53 percent paid at least $1,000 out of pocket, and 37 percent had a medical bill sent to collections. Financial difficulty from past medical expenses still affected 45 percent of them. Fifty-four percent rated their understanding of their health insurance as high, against 40 percent for critical illness coverage and 35 percent for hospital indemnity. |
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MOC Perspective
You are walking into open enrollment with a deductible increase on the table and a workforce where fewer than three in ten call themselves ready for a surprise bill. The spread between 54 percent who say they understand their health insurance and 35 percent who say the same about hospital indemnity is the spread your supplemental products keep falling into. October 2025 fieldwork means these answers describe last year's household, before this year's cost shift landed.
What to do now
| ▪ | Model your 2027 deductible increase against the share of your workforce that could absorb it, and price what closes the gap before you set contributions. | | ▪ | Rewrite your open enrollment materials so hospital indemnity and critical illness lead with the dollar payout, not the product name. | | ▪ | Publish one page showing what a member actually pays out of pocket for the five most used services in your plan. |
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| Source: Employee Benefit Research Institute |
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| 5 · PREVENTIVE COVERAGE · August 24, 2026 |
| HHS Asks Whether to Rewrite the Vaccine Categories That Set Your First-Dollar Coverage |
| HHS published a request for information on August 24 at 91 FR 54724 asking whether the federal government should change the categories used in federal vaccine recommendations. Comments are due September 20 under docket HHS-OS-2026-0332 and RIN 0991-ZA62. The notice describes the three categories now in use: routine, risk-based, and shared clinical decision-making. It states that a shared clinical decision-making recommendation, once adopted by the CDC Director, triggers the same coverage requirements as a routine recommendation, including coverage without cost sharing under the Affordable Care Act. Question 4 asks whether additional or different categories should be adopted, offering "recommended, but not during infancy," "recommended with qualification," and "shared clinical decision-making with qualification" as examples. The notice runs 18 questions across five sections and carries no cost estimate. |
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MOC Perspective
Your non-grandfathered plan covers recommended immunizations at 100 percent in network, and this notice asks whether the categories that create that obligation should change. A new category could add vaccines to your first-dollar list or move some off it, and either direction moves your preventive spend and your plan documents. You need answer only the questions that touch coverage. September 20 is the last day to file an employer view for free.
What to do now
| ▪ | File a comment by September 20 through your coalition, and state what a category change would cost your plan to administer. | | ▪ | Ask your TPA which immunizations it pays at 100 percent in network today and under which recommendation category each one falls. | | ▪ | Flag the preventive services language in your summary plan description for review before you finalize 2027 plan documents. |
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| Source: U.S. Department of Health and Human Services |
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The Bottom Line
Three of these five stories run through the same document, the contract between your plan and the vendor that touches its money. Two federal appeals courts now disagree about whether a TPA's phone call is your liability, a federal judge cleared a self-funded employer to sue its administrator for fiduciary breach, and the FTC told the Fourth Circuit that a patent application deal can be reviewed at all. The other two say what the waiting costs: fewer than three in ten of your people can absorb a surprise bill, and the rules behind your preventive coverage close for comment on September 20. Every one of these turns on paper you already have.
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Jude Odu
Founder and Principal, Model Optimal Care
Author of Model Optimal Care: End U.S. Healthcare Waste, One Health Plan at a Time
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