Thursday, June 15, 2006

Supreme Court Decides Difficult Federal Health Insurance/Jurisdictional Issue

4united_states_supreme_court_112904_4Ross Runkel has posted this summary of this complicated employment decision handed down today by the Supreme Court in  Empire HealthChoice v. McVeigh, No. 05-200 (US. June 15, 2006), as part of a Supreme Court Extra on his Employment Law Memo newsletter (which everyone should sign up for as an essential way of keeping track of labor and employent cases throughout the country).

Here is Ross' to-the-point summary of Empire HealthChoice:

Under the Federal Employees Health Benefits Act, the US Office of Personnel Management (OPM) negotiates and regulates health benefit plans for federal employees. OPM contracts with Blue Cross to provide a nationwide health plan, and Empire administers the plan in New York. McVeigh's decedent was injured and received medical benefits under the plan, and later McVeigh recovered a settlement against third parties who allegedly caused the injuries.

Empire sued McVeigh in federal court seeking reimbursement, and asserting jurisdiction under 28 USC Section 1331 (actions arising under the laws of the United States).

The US Supreme Court held that federal courts do not have jurisdiction under Section 1331. Empire's claim was based on provisions in the contract between OPM and Blue Cross, and are governed by state law. Empire's claim is not a creature of federal law. The DISSENT would hold that the claim arises under federal law within the meaning of Section 1331 because it "arises under federal common law."

Wow, I didn't think it was possible for something to be more convoluted than ERISA. Guess I was wrong.


Labor Law | Permalink

TrackBack URL for this entry:

Listed below are links to weblogs that reference Supreme Court Decides Difficult Federal Health Insurance/Jurisdictional Issue:


Does that mean in states that have no subrogation law, the health plans are not entitled to those funds? what about state that do not allow subrogation but allow reimbursement. Is ther an argument for or agains the reimbursement?

Posted by: jeff | Jun 19, 2006 5:06:15 AM

Post a comment