preemption

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In a unanimous (8-0) opinion authored by Justice Sotomayor, the U.S. Supreme Court held that an Arkansas state law regulating rates at which pharmacy benefits managers (PBMs) reimburse pharmacies is not preempted by ERISA.  (Justice Barrett took no part in the consideration or decision of the case.)  While most people would not think of ERISA…

The Tenth Circuit recently concluded that, as a matter of federal common law, a choice-of-law provision in a long-term disability insurance policy, which was part of the plaintiff’s employer’s ERISA plan, must be enforced because a “clear, uniform rule . . . is required to ensure plan administrators enjoy the predictable obligations and reduced administrative…

The U.S. Supreme Court recently agreed to hear Rutledge v. Pharmaceutical Care Management Association, No. 18-540, a case that asks the Court to decide whether ERISA preempts an Arkansas state law that regulates rates at which pharmacy benefits managers (PBMs) reimburse pharmacies.

PBMs are entities that verify benefits and manage financial transactions among pharmacies,…

ERISA health care plans typically include reimbursement and subrogation clauses, which give plans a right to reimbursement of medical expenses paid on behalf of a beneficiary where the injury is caused by a third party.  While such provisions are common in ERISA health care plans, they sometimes conflict with state laws that prohibit plans and…

The Ninth Circuit agreed that the employer-members of Montana’s Chamber of Commerce failed to state a claim for breach of fiduciary duty under ERISA § 502(a)(2) and violations of ERISA’s prohibited transaction rules under ERISA § 502(a)(3) against health insurers as a result of alleged misrepresentations in the marketing and negotiation of the insurers’ fully…

The Ninth Circuit recently held that ERISA does not preempt a Nevada state law that curtailed the ability of multiemployer plans to recover unpaid employer contributions.  Under Nevada law SB 223, general contractors can be held vicariously liable for the labor debts of their subcontractors, including contributions owed by subcontractors pursuant to a collective bargaining…

The Second Circuit concluded that a promissory estoppel claim by an out-of-network provider against an insurer was not completely preempted by ERISA and thus remanded the claim to state court for further proceedings. The provider’s claim was predicated on its assertion that the insurer made certain representations about coverage for the insured. The Court held…

The First Circuit concluded that, pursuant to the applicable collective bargaining agreement, it was for an arbitrator, not the court, to decide whether the union’s claim that the employer failed to properly fund a defined benefit pension plan was preempted by ERISA. The First Circuit explained that the arbitration clause in the CBA clearly applied…

Oregon, like many states, has on its books a “slayer statute,” which generally prohibits a slayer or abuser of a decedent from obtaining benefits by virtue of the death of the decedent.  The parents of Julianne Herinckx sought to enforce the Oregon slayer statute and preclude their daughter’s murderers from receiving life insurance benefits payable…

A federal district court in Tennessee ruled that ERISA did not preempt state law claims for short-term disability benefits because the short-term disability plan fell under the “payroll practice” exception of ERISA.  LeBlanc v. SunTrust Bank, No. 3:15-cv-00630 (M.D. Tenn. Aug. 24, 2015).  SunTrust provided employees with short-term disability benefits for up to 25 weeks per injury or illness and required employees to be approved for the full 25-week period before they qualified for long-term disability benefits.