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ERISA Preemption & Welfare Benefit Plans

ERISA preemption also applies to the Regulatory side of Welfare Benefit Plans. We typically write about court decisions affecting a claimant’s right to disability benefits under an ERISA governed LTD plan and have expressed our dismay at the broad reach of ERISA preemption as it applies to those types of claims. The recent case of America’s Health Ins. Plans v. Hudgens, No. 13-10349 (11th Cir. Feb. 14, 2014), shows that ERISA’s preemptive scope also applies to medical providers seeking prompt payment for their services. In this case, the district court granted a preliminary injunction to an association representing self-insured ERISA plans, who were seeking to enjoin (as being preempted by ERISA) operation of a Georgia statute imposing prompt pay requirements relating to payments to providers and imposing interest and penalties for noncompliance. The Eleventh Circuit affirmed the grant of injunctive relief, holding: (1) association had standing to pursue claim; and (2) there was a likelihood of success on the merits, given that the statute “relate[s] to” an ERISA plan, and regardless of whether ERISA’s savings clause applies to the statute (as being a law regulating insurance), the “deemer” clause (under which, “if a plan is insured, a State may regulate it indirectly through regulation of its insurer and its insurer’s insurance contracts; if the plan is uninsured [or self-funded], the State may not regulate it”), mandates preemption.