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Supreme Court Stops State Efforts to Get Health Claims Data

Read AARP's Amicus Brief (PDF)


Background

In 2011, Vermont enacted legislation requiring that all entities that pay for medical services—including Employee Retirement Income Security Act (ERISA) self-insured health plans—report claims data and other health-care information to the state for inclusion in a state-operated “unified health care database.” At least thirteen other states have similar reporting requirements.

Liberty Mutual Life Insurance Company refused to provide the required information and challenged the state law on the ground that ERISA preempted the Vermont law. On appeal, the Second Circuit reversed the district court. The Second Circuit held that ERISA preempted the Vermont law because the reporting requirement affected ERISA’s core function of reporting and disclosure by employee benefit plans. The dissent reasoned that the Vermont law's reporting requirements differed from those imposed by ERISA, meaning that the law was not the kind of state law Congress intended to preempt. The Supreme Court agreed to hear the case and upheld the Second Circuit’s decision.


What’s At Stake

AARP’s Vermont state office supported the effort to obtain paid claims data.  These all-payor claims databases are considered a crucial tool in states' efforts to improve public health, control costs, aid research, provide transparency and foster competition among medical providers. The Supreme Court’s decision may seriously impede these efforts.

Though states still may seek paid claims information from non-ERISA entities that pay for medical care, such as insurance companies, this decision renders the databases significantly less effective. The databases will not have data concerning the large segment of the population that receives employer-sponsored health insurance. This decision is important because it provides the boundaries of what action is prohibited by ERISA in the states’ quest to reign in health care costs for consumers and determine if there are more effective methods of treatment.


Case Status

The Supreme Court held that ERISA preempts the Vermont state law that requires all health insurers to report information about paid health care claims to the extent it seeks data from ERISA-governed health plan. Gobeille v. Liberty Mutual Insurance Co., 136 S. Ct. 936 (2016).