This story has been updated.
[T]he Vermont NEA is suing the Williston-based company that abruptly canceled its contracts with school districts to handle health reimbursement accounts for educators.
Teachers have been complaining since last academic year that their claims have been bungled, leaving them with unpaid bills and calls from collection agencies. Future Planning Associates left more than $1.1 million in unpaid or incorrectly processed claims behind when it quit administering plans for some 24,000 educators in the spring, the suit alleges.
The lawsuit, filed in Washington Superior Court on behalf of the Burlington Education Association and other bargaining units, accuses the company of breach of contract and consumer fraud and seeks unspecified damages. It argues Future Planning should have known it couldn’t handle the business it was taking on and misrepresented its capacity when districts decided to hire them.
“Unfortunately, the expertise touted by Future Planning Associates didn’t exist,” Don Tinney, an English teacher and president of Vermont-NEA, said in a statement. “Their incompetence has had real consequences on the women and men who teach Vermont’s children.”
Future Planning chief operating officer Daryl Straw deferred comments to the company’s attorney, Waitsfield-based Lauren Kolitch. Reached on her cellphone, Kolitch said she hadn’t seen the lawsuit and had no indication it was coming.
“This is the first I’ve heard of it,” she said.
Future Planning president and CEO Erin R. Helmken responded to a request for comment on Thursday with a statement emailed Friday afternoon, after this story was published. The statement says the union’s complaint is inaccurate and the company will seek to dismiss the lawsuit.
The statement reads: “Future Planning Associates, Inc. has reviewed the Complaint filed against it by Vermont-National Education Association. The facts alleged are not accurate. Future Planning has never engaged in intentional misconduct. There is no basis for the union’s lawsuit. We will use all of the legal means at our disposal to seek its dismissal.
“We always do our best to be transparent and customer oriented. We acknowledge that data issues and software we purchased from a third party caused us difficulties with school HRA administration, but the rest of the allegations against us are wholly unfounded. Future Planning Associates will prevail in this lawsuit because it has not acted improperly in any way.”
Vermont’s schools switched over to higher-deductible plans starting on Jan. 1. At that time, about 80 percent of districts chose Future Planning to administer a host of reimbursement accounts for employees, including health reimbursement, health savings and flexible spending accounts. In March, just two months after it had started administering those plans, the company notified school districts it would withdraw from its contracts in May. Most districts migrated over to the Arkansas-based company DataPath to administer the accounts left behind by Future Planning.
The union says educators began complaining to the union about their accounts almost as soon as Future Planning began administering them. But the NEA also argues that the company did little to remedy problems before leaving school districts in the lurch, and that it hid the extent of the problems when it handed the accounts over to DataPath, who spent months trying to find and reprocess claims.
In an August memo to districts, DataPath told school officials client data provided to them from Future Planning was missing information on an “unknown” number of claims, and that it would need to start from scratch using Blue Cross Blue Shield claims files to process old reimbursement requests.
“When we took over your benefit plans three months ago, we weren’t fully aware of how complex the problems were, from incorrect plan structures to unprocessed claims,” DataPath wrote in an August memo to school districts.
As of the date of the filing, the NEA says the new company had issued $1.1 million in reimbursements that should have been processed by Future Planning, and it was still combing through old claims.
The suit alleges that teachers put medical expenses on personal credit cards while waiting on reimbursements and incurred penalties, that they deferred getting medical care, and that some providers even declined to schedule follow-up appointments until they were paid. Some teachers were contacted by debt collectors, the suit says, and that “school business offices were overwhelmed by the number of employees affected by this crisis.”
“The crisis generated by FPA’s business mismanagement, by its failure to disclose and deliberate minimization of the problems that it had caused, and by its abrupt termination of contracts with school clients, was unprecedented. The magnitude and scope of the problems were, and remain, staggering,” the NEA’s complaint states.
This story was updated at 2:30 p.m. on Friday with a statement from Future Planning.
