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Supreme Court To Hear Arguments On ERISA Case

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NU Online News Service, Jan. 11, 10:43 a.m. – The U.S. Supreme Court will hear oral arguments Jan. 16 on Rush Prudential HMO Inc., v. Moran et al., a case that could affect the ability of states to regulate employer-sponsored health plans.

The plaintiff in the case, Debra Moran, wanted an outside review of a health plan decision regarding treatment for arm pain. Her state, Illinois, had a law that required Rush Prudential HMO Inc., Chicago, to offer her access to an independent review.

The Employee Retirement Income Security Act preempts the ability of states to regulate employer-sponsored health plans, but ERISA does give states the authority to regulate insurance companies.

Lawyers for Rush say ERISA preempts the Illinois independent review law, but lawyers for Moran say an “insurance savings clause” in ERISA leaves Illinois with enough authority to enforce the law.

A federal district court in Illinois agreed with Rush that ERISA preempts the Illinois external review law, because the law does not deal with the transfer or spread of insurance risk.