The U.S. Supreme Court is looking into a case that could affect when and how federal benefits laws trump state insurance laws.
The court today issued orders asking the U.S. solicitor general to weigh in on Coventry Health Care of Missouri Inc. vs. Jodie Nevils (13-1305) and Aetna Life Insurance Company vs. Mattthew Kobold (13-1467).
The Federal Employees Health Benefits Act of 1959 (FEHBA) — the law that governs federal employees’ health benefits — lets health insurers put liens on enrollees’ lawsuit recoveries when enrollees injured by others get money by filing negligence suits. One part of FEHBA, FEHBA Section 8902(m)(1), states that FEHBA preempts state anti-subrogation laws, or laws that prohibit insurers from suing the parties that have hurt their insureds for recoveries.
The U.S. Office of Personnel Management (OPM) — the agency that runs the Patient Protection and Affordable Care Act (PPACA) multi-state plan program — runs the federal health benefits program and is usually responsible for interpreting FEHBA.
Arizona and Missouri both forbid health insurers from seeking reimbursement for benefits paid from health plan members’ lawsuit recovery money. The Missouri Supreme Court argued that Congress can’t use FEHBA to have a contract provision pre-empt state anti-reimbursement laws. Arizona has a similar anti-reimbursement law, and an Arizona state court came to a similar conclusion.