My latest contribution to BloombergLaw was the following piece on some of the unique issues and challenges presented for self-insured employers and their plan administrators when those employers seek (or contemplate) bankruptcy relief. In brief:
- Read your contracts (always good advice!) and identify any slippages in performance;
- Attend to first-day matters, including possible priority treatment of plan contributions; and
- For plans already terminated, watch out for run-off periods that may linger even after the employer seeks bankruptcy protection.
As employers across the country struggle to outlast the current medical and economic crisis, [self-insured plan] administrators can stay ahead of potential problems by taking a proactive approach to ensuring compliance with contract terms, corralling deficiencies before they worsen, and recognizing the challenges and opportunities when bankruptcy enters the picture.