Justia ERISA Opinion Summaries

Articles Posted in Constitutional Law
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In 2019, the Oklahoma legislature unanimously passed the Patient’s Right to Pharmacy Choice Act. In response to the Act’s passage, the Pharmaceutical Care Management Association (PCMA), a trade association representing PBMs, sued to invalidate the Act, alleging that the Employee Retirement Income Security Act of 1974 (ERISA), and Medicare Part D, preempted the Act. The district court ruled that ERISA did not preempt the Act but that Medicare Part D preempted six of the thirteen challenged provisions. PCMA appealed the court’s ERISA ruling on four provisions of the Act and the court’s Medicare Part D ruling on one provision. After its review, the Tenth Circuit determined ERISA and Medicare Part D preempted the four challenged provisions, and therefore reversed. View "Pharmaceutical Care v. Mulready, et al." on Justia Law

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This case presented the questions of whether and how Alaska Statute 09.55.548(b) applied when the claimant’s losses were compensated by an employer’s self-funded health benefit plan governed by the federal Employee Retirement Income Security Act (ERISA). The Alaska Supreme Court concluded that an ERISA plan did not fall within the statute’s “federal program” exception. Therefore AS 09.55.548(b) required a claimant’s damages award to be reduced by the amount of compensation received from an ERISA plan. But the Supreme Court also concluded that the distinction the statute draws between different types of medical malpractice claimants was not fairly and substantially related to the statute’s purpose of ensuring claimants do not receive a double recovery — an award of damages predicated on losses that were already compensated by a collateral source. "Because insurance contracts commonly require the insured to repay the insurer using the proceeds of any tort recovery, claimants with health insurance are scarcely more likely to receive a double recovery than other malpractice claimants. The statute therefore violates the equal protection guarantee of the Alaska Constitution." View "Knolmayer, et al. v. McCollum" on Justia Law

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BP Corporation North America Inc. (“BP America”) a Defendant-Appellee in this action, acquired Standard Oil of Ohio (“Sohio). BP America converted the Sohio Plan into a new plan called the BP America Retirement Plan (the “ARP”). The ARP was also a defined benefit plan that retained the formula used by the Sohio Plan to calculate its members’ pension distributions. BP America converted the ARP into the BP Retirement Accumulation Plan (the “RAP,” the conversion from the ARP to the RAP as the “Conversion,” and the date of the Conversion as the “Conversion Date”), the other Defendant-Appellee in this action. Plaintiffs-Appellees, two Sohio Legacy Employees, (the “Guenther Plaintiffs”) filed a class action complaint against the RAP and BP America.   Four years after the Guenther Plaintiffs filed their original complaint, Movant-Appellant, along with 276 other individuals (the “Press Plaintiffs”) moved to intervene in the Guenther Action “for the purpose of objecting” to the magistrate judge’s recommendation. Press Plaintiffs contend that the certified class in the Guenther Action inadequately represents their interests, and therefore, they have a right to intervene in this case.   The Fifth Circuit affirmed the district court’s ruling denying the intervention. The court held that the Press Plaintiffs cannot demonstrate that their interests diverge from those of the Guenther Plaintiffs in any meaningful way. Further, the Press Plaintiffs did not identify a unique interest of their own, they are unable to specify how a determination in the Guenther Action could have a future detrimental preclusive effect. The court wrote it is satisfied that the Press Plaintiffs will be adequately represented. View "Guenther v. BP Retr Accumulation" on Justia Law

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Plaintiffs, individuals living with HIV/AIDS who have employer-sponsored health plans, and who rely on those plans to obtain prescription drugs, filed suit alleging that CVS's program violates the anti-discrimination provisions of the Affordable Care Act (ACA), the Americans with Disabilities Act (ADA), and the California Unruh Civil Rights Act (Unruh Act); denies them benefits to which they are entitled under the Employee Retirement Security Act (ERISA); and violates California's Unfair Competition Law (UCL). The district court granted defendants' motion to dismiss.The Ninth Circuit held that Section 1557 of the ACA does not create a healthcare-specific anti-discrimination standard that allowed plaintiffs to choose standards from a menu provided by other anti-discrimination statutes. Because plaintiffs claim discrimination on the basis of their disability, to state a claim for a Section 1557 violation, they must allege facts adequate to state a claim under Section 504 of the Rehabilitation Act. Applying the section 504 framework, the panel concluded that plaintiffs adequately alleged that they were denied meaningful access to their prescription drug benefit under their employer-sponsored health plans because the program prevents them from receiving effective treatment for HIV/AIDS. Therefore, plaintiffs have stated a claim for disability discrimination under the ACA.However, plaintiffs have failed to establish a claim of disability discrimination under the ADA, because they have not plausibly alleged that their benefit plan is a place of public accommodation. Finally, the panel upheld the district court's denial of plaintiffs' claims under ERISA and their cause of action under California's Unfair Competition Law. The panel affirmed in part, vacated in part, and remanded. View "Doe v. CVS Pharmacy, Inc." on Justia Law

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PCMA filed suit claiming that the Employee Retirement Income Security Act of 1974 (ERISA) and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Medicare Part D), preempt two sections of the North Dakota Century Code regulating the relationship between pharmacies, pharmacy benefits managers (PBMs), and other third parties that finance personal health services. The district court determined that only one provision in the legislation was preempted by Medicare Part D and entered judgment in favor of North Dakota on the remainder of PCMA's claims.The Eighth Circuit held that it need not address the "connection with" element of the analysis because the legislation is preempted due to its impermissible "reference to" ERISA plans. In this case, the legislation is preempted because its references to "third-party payers" and "plan sponsors" impermissibly relate to ERISA benefit plans. Therefore, the court held that the North Dakota legislation is preempted because it "relates to" ERISA plans "by regulating the conduct of PBMs administering or managing pharmacy benefits." Finally, the court held that North Dakota waived its savings clause argument. Accordingly, the court affirmed in part, reversed in part, and remanded. View "Pharmaceutical Care Management Ass'n v. Tufte" on Justia Law

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The Employee Retirement Income Security Act of 1974 (ERISA), generally exempts from its requirements “church plans”: employee-benefit plans established and maintained by churches for their employees. ERISA also extends that church-plan exemption to "principal-purpose" organizations. Catholic Health Initiatives (CHI), a nonprofit organization created to carry out the Roman Catholic Church’s healing ministry, operates 92 hospitals and numerous other healthcare facilities in 18 states. CHI offers a retirement plan for its employees, with more than 90,000 participants and beneficiaries, and nearly $3 billion in plan assets. Janeen Medina, a CHI employee, filed a class action, alleging that CHI’s retirement plan failed to satisfy the statutory criteria for the church-plan exemption. She contended that, since the plan did not qualify for the exemption, CHI should have complied with the reporting and funding requirements of ERISA. Medina also argued the individual defendants who administered the plan breached their fiduciary duties by failing to comply with ERISA. And, Medina argued, even if the CHI plan did qualify as a church plan, the exemption violated the Establishment Clause of the United States Constitution. The district court held that CHI’s plan was a church plan that qualified for the ERISA exemption. On appeal, the Tenth Circuit agreed, concluding that CHI’s plan satisfied the statutory requirements for the church-plan exemption as a proper principal-purpose organization. The ERISA exemption, moreover, does not run afoul of the United States Constitution’s Establishment Clause. View "Medina v. Catholic Health Initiatives" on Justia Law

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To stimulate economic development, Jersey City, New Jersey offers tax exemptions and abatements to private developers of projects in certain designated areas. Those tax benefits are conditioned on the developers’ entry into agreements with labor unions that bind the developers to specified labor practices. Employers and a trade group challenged that law, alleging that it is preempted by the National Labor Relations Act (NLRA) and Employee Retirement Income Security Act (ERISA) and barred by the dormant Commerce Clause of the U.S. Constitution. The district court dismissed the complaint, concluding that Jersey City acts as a market participant, not a regulator, when it enforces the law, so that NLRA, ERISA, and dormant Commerce Clause claims were not cognizable. The Third Circuit reversed, holding that Jersey City was acting as a regulator in this context. The city lacks a proprietary interest in Tax Abated Projects. The Supreme Court has recognized a government’s proprietary interest in a project when it “owns and manages property” subject to the project or it hires, pays, and directs contractors to complete the project; when it provides funding for the project; or when it purchases or sells goods or services. This case fits none of these categories. View "Assoc. Builders & Contractors, Inc. v. City of Jersey City" on Justia Law

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Medicare Part C, 42 U.S.C. 1395w-21 et seq., permits enrollees to obtain Medicare-covered healthcare services from private healthcare organizations and their third-party contractors. The Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., regulates health plans offered by private employers to employees. At issue is whether continued inpatient treatment by Providers was medically necessary, and therefore compensable, for several MA Plan Members and ERISA Plan Members initially hospitalized for mental health evaluations or treatment. The court held that the administrative appeals process provided under the Medicare Act preempts arbitration of Medicare-related coverage disputes between private healthcare administrators and providers, even though arbitration would otherwise be required by the parties’ contracts and the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. In this case, Providers’ coverage claims are inextricably intertwined with claims for Medicare benefits, and they therefore are subject to the Medicare Act. The Act provides mandatory administrative review procedures for these disputes, which preempt arbitration. The court concluded, however, that the court of appeals erred by deciding that whether Aurora’s ERISA-related claims are arbitrable depends on whether Aurora has standing to assert this claim. The court of appeals should decide on remand whether this claim is arbitrable without considering the standing issue or whether any valid defenses to the claim exist. Therefore, the court remanded to the court of appeals to decide whether ERISA similarly preempts arbitration of ERISA-related coverage disputes. View "United Behavioral Health v. Maricopa Integrated Health Sys." on Justia Law

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Plaintiffs, two individual psychiatrists and three professional associations of psychiatrists, filed suit against defendants, four health‐insurance companies, alleging that the health insurers’ reimbursement practices discriminate against patients with mental health and substance use disorders in violation of the Mental Health Parity and Addition Equity Act of 2008 (MHPAEA), 29 U.S.C. 1185(a), and the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001-1461. The court concluded that, because the psychiatrists are not among those expressly authorized to sue, they lack a cause of action under ERISA. The court also concluded that the association plaintiffs lack constitutional standing to pursue their respective ERISA and MHPAEA claims because their members lack standing. Accordingly, the court affirmed the judgment. View "Am. Psychiatric Ass’n v. Anthem Health Plans, Inc." on Justia Law

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The Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001, sets minimum funding and vesting requirements, insures benefits through the Pension Benefit Guarantee Corporation and includes reporting, disclosures, and fiduciary responsibilities, but exempts church plans from its requirements. The plaintiffs, former and current employees, have vested claims to benefits under the Advocate retirement plan. Advocate operates Illinois healthcare locations, employing 33,000 people. Advocate maintains a non-contributory, defined-benefit pension plan that covers substantially all of its employees. Advocate is not a church. Its predecessor formed as a 501(c)(3) non-profit corporation from a merger between two health systems—Lutheran General and Evangelical. Advocate is affiliated with the Evangelical Lutheran Church and the United Church of Christ, but it is not owned or financially supported by either church. In contracts, the parties “affirm their ministry in health care and the covenantal relationship they share.” There is no requirement that Advocate employees or patients belong to any particular religious denomination, or uphold any particular beliefs. The Seventh Circuit affirmed that the plan “is not entitled to ERISA’s church plan exemption as a matter of law” because the statutory definition requires a church plan to be established by a church. The court rejected Advocate’s First Amendment arguments. View "Stapleton v. Advocate Health Care Network" on Justia Law