Health Administration Responsibility Project

Unsuccessful Claims against ERISA Preemption

CANNON v. GROUP HEALTH 77 F.3d 1270; (10th Cir. 1996)
Insurers denied preauthorization for ABMT for Leukemia until it was too late to do it. Patient died.
Claim: Insurers either negligently or in bad faith refused to authorize ABMT.
Held: Dismissed.
Common law tort and contract claims are preempted by ERISA.
Claim: to recover benefits due under the plan, per ERISA 502(a)(1)(B).
Held: Dismissed. P never incurred medical expenses.
Claim: for equitable relief per ERISA 502(a)(3).
Held: Dismissed. P never incurred medical expenses.
Claim: Breach of fiduciary duty per ERISA 502(a)(2).
Held: Dismissed.
"A fiduciary is liable under ERISA, if at all, to the plan and not to the beneficiary."
Claim: ERISA may not preempt state causes of action where ERISA does not provide a remedy.
Contends preemption in this context is inconsistent with the policies behind ERISA & the McCarran-Ferguson Act.
Held: Dismissed.
"the lack of an ERISA remedy does not affect a pre-emption analysis."
See Corcoran v. United Healthcare, Inc., 965 F.2d 1321, 1333 (5th Cir.) cert. denied.
Claim: The Tenth Amendment supports the theory that if there is no federal remedy, there may be no preemption of State remedies.
Held: Dismissed.
Claim: P says his claims fall within the savings clause because they regulate insurance.
Held: Dismissed.
"We have found no case which stands for the proposition [that] an insurance company which contracts through an employer to supply insurance to an employee benefit plan should be deemed an insurance company."
"His claims arise from generally applicable common law principles which do not specifically regulate insurance within the meaning of the savings clause."
Claim: Preemption is an unconstitutional denial of P's right to access justice and to have a remedy.
Sources: Fifth Amendment's Due Process Clause.
One of the Ninth Amendment's rights reserved to the people is the right to access courts for redress.
Magna Carta: "To none will we sell, to none will we deny, to none will we delay right to justice."
Bounds v. Smith, 43 U.S. 817, 52 L. Ed. 2d 72, 97 S. Ct. 1491 (1977);
Doe v. Puget Sound Blood Center, 117 Wash. 2d 772 (Wash. 1991)
Held: Dismissed.
"A fundamental right to access justice has yet to be defined."
"The Supreme Court has carefully limited those rights considered part of the substantive component of liberty within the meaning of the Due Process Clauses of the Fifth and Fourteenth Amendments."
"The cases are inapposite."
Claim: Equitable estoppel should apply here to prevent the insurers from benefitting from their unreasonable conduct.
Held: Dismissed.
There is no misrepresentation of any term of the plan to trigger P's reasonable detrimental reliance.
Misinterpretation does not amount to Misrepresentation.

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