Final Results for the Pension Protection Act
Both chambers of Congress recently passed the final, agreed upon version of the Pension Protection Act that amends ERISA. When it came out of the House of Representatives last year the sponsor inserted in the dead of night an overreaching provision that gave a significant leg up to insurers and employers seeking to recover their subrogation interests and be reimbursed money they had previously paid out in health benefits to ERISA plan participants and beneficiaries. I blogged about the issue a lot at the time. When Sereboff v. MAMSI, 126 S.Ct. 1869 (2006), came down in May it reduced the desire of the business and insurance lobbyists to have this special interest legislation included in the final bill because the Supreme Court gave employers and insurers much of what they were seeking in the proposed legislation.
The good news is that the obnoxious stealth clause allowing insurers and employers to be reimbursed all their payments from a plan participants personal injury recovery, regardless of the degree to which the person is made whole, was deleted during the last stages of negotiating the final version of the Pension Protection Act. Unfortunately, we still have to live with Sereboff.