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Regulation and Compliance > State Regulation

High Court Upholds State Laws On Independent Reviews

By Steven Brostoff

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High Court Upholds State Laws On Independent Reviews

By

Washington

In a decision that could have major implications in the debate over patient protection legislation, the United States Supreme Court has ruled that states can require managed care plans to accept independent review determinations regarding medically necessary treatments.

In a 5-4 decision, the court upheld a 7th Circuit Court of Appeals determination that the Employee Retirement Income Security Act does not preempt state laws mandating independent review.

In the case of Rush Prudential HMO v. Moran, an employer-sponsored managed care plan challenged Illinois independent review law, arguing that it is preempted by ERISA.

However, the 7th Circuit rejected the challenge, stating that while ERISA preempts most state laws affecting employer-sponsored plans, state laws that regulate the business of insurance are saved from preemption.

Nearly 40 jurisdictions in the U.S. have similar laws.

Reproduced from National Underwriter Life & Health/Financial Services Edition, June 24, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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