Two members of the Local 600 chapter of the International Cinematographer’s Guild claim in a lawsuit that some participants in the Motion Picture Industry (MPI) Health Plan were granted special relief amid the COVID-19 crisis while others were excluded.
Filed against the plan’s board of directors, benefits committee and claims review committee, the 18-page proposed class action alleges that after the COVID-19 pandemic shut down the motion picture industry in March, the defendants extended to certain health plan participants work credit hours, premium waivers, and COBRA subsidies while the plaintiffs and others were left “out in the cold.”
The plaintiffs allege the defendants violated their fiduciary duty under the Employee Retirement Income Security Act of 1974 (ERISA), which requires plan administrators to “treat all Plan participants fairly and not to arbitrarily favor one group of participants over another.”
“Both men joined this union in part to receive these advertised health benefits,” the lawsuit says, “but those benefits have now proved elusive at a time when needed the most during this unprecedented COVID-19 pandemic.”
In order to be eligible for benefits under the MPI health plan, a participant must meet the plan’s work hours requirements within a six-month qualifying period, the lawsuit says. Those who have never been eligible for benefits, or who have not been eligible in any of the five prior six-month eligibility periods, must work at least 600 hours of covered employment, with 400 work hours required in subsequent six-month periods, the case states. According to the suit, when a worker accrues enough hours during a qualifying period, he or she and any dependents will be eligible for health plan benefits during the corresponding eligibility period:
“For example, if a participant’s benefit eligibility is set to expire on May 31, 2020, the Plan will reassess his eligibility for the subsequent Eligibility Period of June 1, 2020 through November 30, 2020, during the corresponding Qualifying Period of September 23, 2019 through March 21, 2020. Therefore, if this participant has worked at least 400 hours between September 23, 2019 through March 21, 2020, he and his dependents will remain eligible for benefits during the next Eligibility Period. If the participant does not qualify for that Eligibility Period because he has not worked at least 400 hours during the Qualifying Period, his eligibility will automatically be reviewed again one month later, for the next six-month Eligibility Period (meaning it is possible to requalify for benefits within just one month of becoming ineligible).”
Recognizing that many plan participants would be unable to accrue a sufficient number of qualifying hours after COVID-19 shut down the film industry, the plan’s board of directors extended up to 300 hours of work credit for April and May 2020 to those whose benefit eligibility was under review during those months, the lawsuit says. Additionally, the defendants granted participants premium waivers for dependents and future COBRA premium subsidies, the case states, adding that the plan’s COVID-19 relief has acted as “an important safety net” during a time when access to healthcare has become a critical necessary resource.
According to the case, however, the defendants excluded some plan participants from COVID-19-related relief by extending such only to “Active Participants who are currently enrolled in MPIHP and whose benefit period ends on June 30, 2020 (this is for the qualifying period that ends in April 25, 2020).”
For plan participants who had accrued 375 hours or more in the six-month period ending in March, the defendants provided a mere 25 credit hours to reach the 400-hour requirement, the lawsuit says. If participants had at least 300 hours but less than 375, they had to prove to the defendants that they would have worked sufficient hours by March 21, the case claims, noting that these participants had to meet “a more onerous standard” than those whose qualifying period ended just a month later.
“For example,” the complaint states, “to remain eligible for benefits, a participant with 350 hours had to prove that he would have met the 400-hour requirement by March 21 absent the shutdown; in contrast, no participant with a Qualifying Period ending just one month later had to make any kind of showing, even if that individual only had 100 hours at the time of the shutdown and was only scheduled to work minimal hours during the months of March or April.”
The lawsuit argues the defendants thus precluded from receiving health insurance benefits those who were on track to meet the April deadline but not the March deadline, as well as anyone working toward their initial 600-hour requirement. From the complaint:
“The loss of both income and affordable health insurance coverage during this worldwide health crisis is devastating to the Plan participants and their family members who were arbitrarily excluded by Defendants despite the fact that they, like the other participants who were extended the 300 hours, premium waiver for dependents, and/or COBRA subsidies, lost their needed work hours due to the crisis.”
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