Supreme Court Holds that State All-Payer Claims Database Laws are Preempted by ERISA
Did the Second Circuit – in a 2-1 panel decision that disregarded the considered opinion advanced by the United States as amicus – err in holding that ERISA preempts Vermont’s health care database law as applied to the third-party administrator for a self-funded ERISA plan?
In a coalition amicus brief, the U.S. Chamber argued that the Supreme Court should affirm the Second Circuit’s decision that ERISA preempts Vermont’s health care database law as applied to the third-party administrator of a self-funded ERISA plan.
In its brief, the Chamber explains the operation of self-funded ERISA plans, describes the benefits of these plans to employers and employees, and examines how claims database laws like Vermont’s impose a substantial burden on self-funded employer plans due to conflicting state requirements. In addition, the brief argues that ERISA benefit plans have the exclusive purpose of providing benefits, and may not be drafted to fulfill a state’s interest in data collection.
By a 6-2 vote, the Supreme Court held ERISA pre-empts Vermont’s statute as applied to ERISA plans. As the Court explained, “The state statute imposes duties that are inconsistent with the central design of ERISA, which is to provide a single uniform national scheme for the administration of ERISA plans without interference from laws of the several States even when those laws, to a large extent, impose parallel requirements."