Subrogation and Reimbursment recoveries ensure plan assets are protected in accordance with the terms of the plan. Any TPA, administrator or insurer who has discretion in indentifying, pursuing and settlement of subrogation claims is a plan fiduciary. See 29 U.S.C. §1002 (21)(A); See Also, Hamilton v. Carell, 243 F.3d 992 (6th Cir. 2001);.3d 79 (6th Cir. 1993); Hunter v. Caliber, 220 F.3d 702 (6th Cir. 2000). A plan fiduciary enforcing a subrogation right owes a duty to the plan and its participants to recover the money as provided in the subrogation/reimbursement clause of the plan. Bowen v. Central States, Southeast & Southwest Area Health Fund, 1992 U.S. App. LEXIS 10816 (6th Cir May 6, 1992), 1992 W.L. 92832 (6th Cir. May 6, 1992).

Many TPA's or administrators delegate their subrogation or recovery efforts to companies or rely upon the personal injury attorneys to secure a recovery for the plan. Even though those duties are delegated, a fiduciary may have a duty to "monitor appropriately" those companies or attorneys and remove them if they are not properly recovering for the plan. See Coyne & Delany Co. v. Selman, 98 F.3d 1457 (4th Cir. 1996); 29 C.F.R. § 2509.75-8 at FR-17. Those companies or personal injury attorneys must be working for the best interest of the plan and no other party.

A Fiduciary owes an obligation to the plan to recover subrogation money to protect all plan participants and defray reasonable costs of administration. 29 U.S.C. § 1104; See Also, Hunter v. Caliber, 220 F.3d 702 (6th Cir. 2000); Krohn v. Huron Memorial Hosp., 173 F.3d 542 (6th Cir. 1999). A fiduciary's failure to identify subrogation or to recover all the plan money as dictated in the plan constitutes a breach of their fiduciary duty found in § 1104. Breach of fiduciary duty results in personal liability.

"Any person who is a fiduciary with respect to a plan who breaches any of the responsibilities, obligations, or duties imposed upon the fiduciary by this title shall be personally liable to make good to such plan any losses to the plan resulting from each such breach." See 29 U.S.C.§ 1109(emphasis added). Individuals who make decisions on pursuing, settling or recovering under subrogation and reimbursment are personally liable to the plan for any money not properly recovered.

As a TPA or administrator are you getting back all the money for the plans as provided in its subrogaiton and reimburement clause? It could cost you personally and your TPA if you are not.