Gobeille v. Liberty Mutual Insurance Co.: Just Another ERISA Preemption Decision—Or a Bellwether Decision for States and Providers Caught Up In Health Care Reform’s War of Attrition?

S ome Supreme Court rulings decide comparatively isolated legal issues, such as whether religious figures can be placed on the front lawn of a county courthouse without violating the First Amendment. Other Supreme Court rulings decide legal issues which, while certainly important in their own right, have significant and far-reaching legal and/or public policy consequences. Gobeille v. Liberty Mutual Ins. Co., 577 U.S. ___ (March 1, 2016) (Gobeille), in which the Supreme Court held that Vermont’s claims data collection law was expressly preempted by the Employee Retirement Income Security Act (ERISA) when it comes to private sector employers’ self-insured group health plans, falls into this second category (41 PBD, 3/2/16). Gobeille is a significant ruling, with immediate and far-reaching consequences. For example, within a week of issuing its decision in Gobeille, the Supreme Court on March 7, 2016, vacated the Sixth Circuit’s holding in Self-Insurance Institute of America v. Snyder, 761 F.3d 631 (6th Cir. 2014); (45 PBD, 3/8/16), that Michigan’s health insurance tax law is not preempted by ERISA (as applied to self-insured group health plans) and sent that case back to the Sixth Circuit for further consideration in light of Gobeille. How else to explain why seventeen states and the District of Columbia, led by New York state, filed an amicus brief in support of Vermont’s contention that it should be permitted to get a hold of the payer claims data being generated by Liberty Mutual’s own selfinsured group health plan (and other employers’ selfinsured group health plans)? How else to explain why the National Governors’ Association, the National Conference of State Legislatures and the National Association of Insurance Commissioners joined the fray by filing a combined amicus brief, or why the American Hospital Association, the American Medical Association and the Solicitor of the United States each filed amicus briefs taking that same side? And why did they all urge the Supreme Court—unsuccessfully, as things turned out—to reverse the decision by a divided panel of the United States Second Circuit Court of Appeals, holding that Vermont did not have the authority to force private sector employers to directly or indirectly hand over their group health plan’s claims payment data because the Vermont law was preempted by ERISA? (Liberty Mutual Ins. Co. v. Donegan, 746 F.3d 497 (2nd Cir. 2014); the case was renamed on appeal when Vermont’s top official got replaced.) To really find out what was going on in Gobeille, and why the case drew all that attention—particularly, from health care providers and state regulators—one has to dig into the decision. It is a worthwhile exercise. The decision changes the way that ERISA plan fiduciaries should look at their group health plan records and should change the conversation between plan fiduciaries and record keepers like Aetna, Anthem and United Healthcare. The decision also provides important insight into what health care providers, and states and state agencies, are doing to find out what approaches private sector employers are taking to deal with their health care costs—and, possibly, why they are doing it.