Document: 471 U.S. 724 105 S.Ct. 2380 85 L.Ed.2d 728 METROPOLITAN LIFE INSURANCE COMPANY, Appellant,v.Commonwealth of MASSACHUSETTS. TRAVELERS Appellant, v. Commonwealth Nos. 84-325, 84-356. Argued Feb. 26, 1985. Decided June 3, Syllabus A Massachusetts statute (§ 47B) requires that certain minimum mental-health-care benefits be provided a resident who is insured under general health insurance policy or an employee health-care plan covers hospital and surgical expenses. Appellant insurer in No. 84-325 contends § 47B, as applied to policies purchased by plans regulated the federal Employee Retirement Income Security Act 1974 (ERISA), pre-empted Act. Section 514(a) ERISA provides shall "supersede any all State laws insofar they may now hereafter relate benefit plan." But 514(b)(2)(A) that, with one exception, nothing "shall construed exempt relieve person from law which regulates insurance." The exception found 514(b)(2)(B), states no employee-benefit deemed company other . engaged business for purposes purporting regulate companies [or] contracts." 84-356 pursuant collective-bargaining agreements National Labor Relations (NLRA), Act, because it effectively imposes contract term on parties otherwise would mandatory subject collective bargaining. brought action Superior Court enforce 47B against appellant insurers, court issued injunction requiring insurers provide coverage mandated 47B. Supreme Judicial affirmed, finding pre-emption either NLRA. Held: 1. applied, "which insurance" within meaning 514(b)(2)(A), therefore not applies contracts ERISA. 514(b)(2)(A)'s plain language, its relationship provisions, traditional understanding regulations, lead conclusion mandated-benefit such are saved operation 514(b)(2)(A). Nothing ERISA's legislative history suggests different result. Pp. 739-747. 2. Nor negotiated agreement NLRA, 747-758. (a) NLRA involved here protects state interference implicated structure itself, pre-empting causes concerning conduct Congress intended unregulated. 747-751. (b) Such rests sound NLRA's purpose incompatible view pre-empts attempt impose minimum-benefit terms agreement. 751-753. (c) Minimum labor standards affect union nonunion employees equally neither encourage nor discourage processes do have but most indirect effect right self-organization established Unlike laws, designed promotion their interests collectively; rather, part give protections individual ensure each covered receives coverage. These independent process. 753-756. (d) There suggestion disturb set were unrelated processes. To contrary, developed framework bargaining larger body promoting public safety. When establishes minimal employment standard inconsistent goals, conflicts none purposes. regulation implement Commonwealth's mental-health care, valid unexceptional exercise police power. Though potentially limits employee's choose thing he something else, does limit protected 756-758. 391 Mass. 730, 463 N.E.2d 548 (1984), affirmed. Jay Greenfield, New York City, 84-325. Addison Lane McGovern, Boston, Mass., Sally A. Kelly, appellee. Justice BLACKMUN delivered opinion Court. 1 specified policy, accident sickness first question before us these cases whether statute, 1974, second 2 * 3 General typically sold group employer group.1 Group presently extensive regulation, including carrier, sale advertising insurance, content contracts.2 Mandated-benefit require kind cover illness procedure whenever someone purchases subclass regulation. 4 While statutes relatively recent phenomenon,3 regulating substantive become commonplace 50 States over last 30 years.4 Perhaps familiar those automobile policies.5 5 group-health contracts, particular, also been extensively States. For example, majority currently dependents continue beyond contractually imposed age limitation when dependent incapable self-sustaining mental physical handicap; date back early 1960's.6 And 15 years required infants begin at birth, rather than some time shortly after had prior practice unregulated market.7 Many offer optional basis particular kinds purchasers.8 Others mandate include services rendered type provider.9 6 statutes, then, only variety matrix health-insurance further policy. Gen.Laws Ann., ch. 175, (West Supp.1985), typical place States.10 With respect resident, coverage, has well protection. In 60 days confinement hospital, equal nonmental illness, outpatient benefits.11 7 was address problems encountered treating Massachusetts. determined working people needed high cost treatment illness. It believed without mentally ill workers often institutionalized large hospitals, higher incidence more effective private community centers. See Court, Joint Committee Insurance, Advances Health Insurance (1974), reprinted App. 426, 430-432. 8 addition, concluded voluntary market adequately providing "adverse selection" insurance: good risks purchasing this drove up price might purchase insurance. legislature interest correct mandating minimum-coverage levels, forcing good-risk individuals risk pool, enabling average retracted due adverse selection. Findings Fact Juris. Statement pp. 50a-53a. help safeguard costs comprehensive inpatient reduce nonpsychiatric medical-care expenditures related shift delivery services, financial burden encounter problems. Ibid. our task decide violates law. B 9 88 Stat. 829, amended, 29 U.S.C. 1001 et seq. comprehensively pension welfare plans. An welfare-benefit defined "medical, surgical, care benefits, event sickness, accident, disability death," "through otherwise." 3(1), 1002(1). Plans self-insure participants. so-called "insured plans"—are directly affected industry. 10 upon requirements relating participation, funding, vesting. §§ 201-306, 1051-1086. various uniform procedural reporting, disclosure, fiduciary responsibility both 101-111, 401-414, 1021-1031, 1101-1114. Shaw Delta Air Lines, Inc., 85, 91, 103 2890, 2896-2897, 77 490 (1983). 11 thus contains almost does, however, contain broad provision declaring 514(a), 1144(a). Metropolitan argues Massachusetts' restricts purchase. 12 broadly plan, substantially qualified "insurance saving clause," 1144(b)(2)(A), banking, securities." clause 1144(b)(2)(B), "deemer exceptions relevant here, insurer, bank, trust company, investment banking companies, banks, companies." law, sell plans, "law insurance," 13 Wholly apart ERISA, Travelers agreements, 49 449, 151 statutory indicating extent pre-empt Resolution question, therefore, discern intent language. II 14 Appellants Life Company (insurers) located Connecticut respectively issue employers unions employ represent residing Under appellants residents. 1979, Attorney suit declaratory injunctive relief asserted since January 1, 1976, policyholders situated outside residents Commonwealth. 8-9. failed Massachusetts-resident beneficiaries policies, believing themselves bound answer, admitted allegations.12 16 complaint amended number violation 9-10. Finally, refused ground 10. actually Commonwealth, preserved challenge applicability Commonwealth.13 accordingly requested preliminary permanent relief, asking regardless receiving benefits. 11-12. 17 57-59. After trial, judge same effect, see 67a-70a, making findings fact cost, nature, purpose, id., 36a-62a. granted insurers' application direct appellate review affirmed judgment Ins. Co., 385 598, 433 1223 (1982). 18 Addressing recognized " 'relate[s] to' plans," so unless fell 605, N.E.2d, 1227. went hold, understood clause, 606-609, 1228-1230.14 rejected appellants' claim save "traditional" promote health, language nonetheless wary literal reading lest unintended authority areas governed provisions Since indirectly affects 606-607, 609, 1228-1229. 19 then conclude Although bargaining, local affecting relations. labor-management relations free play economic forces between management. "It unlikely intended, enacting bind hands Legislatures health." 613, 1232. 20 Moreover, pointed out, indicated McCarran-Ferguson 59 33, 1011 seq., should supersede "regulating 1012(b). operates policies. limiting definition "business suggest narrow excluding 613-614, 21 On appeal, 1221, 3563, 1405 (1983), vacated remanded consideration light intervening decision Appropriately refocusing decision, justice dissenting, reinstated former judgment. (1984). reasoned addressed Shaw, listed 514(b), statement "narrow" merely dictum did compel change 733, 550. exemption 514(b) phrased very broadly. there reason alter construction given clause. held "relate[d] to" conflicted statute. conflict-based analysis being too interpretation provision, follow similarly rejected. 22 dissenting felt made clear exemptions read narrowly order preserve nationwide uniformity administration Reading narrowly, As concerns must provide, incidentally "irrelevant dictating ERISA." 736, 552. 23 once again appealed 28 1257(2), we noted probable jurisdiction. 469 929, 320, 83 258 (1984).15 III 24 "In deciding ascertain Congress' issue. 'Pre-emption express implied, "is compelled command explicitly stated statute's implicitly contained purpose." Jones Rath Packing 430 519, 525, 97 1305, 1309, 51 604 (1977).' Fidelity Federal Savings & Loan Assn. De la Cuesta, 458 141, 152-153, 102 3014, 3022, 73 664 (1982)." U.S., 95, S.Ct., 2899. presented Mass.Gen.Laws 514(a). 25 clearly "relate[s] fall reach scope recently supra, where Human Rights Law State's Disability Benefits phrase "relate common-sense meaning, "in normal sense phrase, if connection reference 97, 2900. displace sphere, even consistent requirements. Id., 98-99, 2900-2901. "[E]ven bearing pensions encroach area exclusive concern." Alessi Raybestos-Manhattan, 451 504, 101 1895, 1907, 68 402 (1981). 26 denominated benefit-plan bears them common argue agree relates forth 27 Nonetheless, sphere limited 514(b)(2). preserves two sections, while enough faces, perhaps model drafting, appears States' lawmaking power much occasionally decides return what previously taken away, normally time.16 Fully aware complexity, still choice "begin employed assumption ordinary accurately expresses Park 'N Fly, Inc. Dollar 189, 194, 658, 662, 582 (1985). We presume intend (1977). obvious, seems This matter, moreover, reinforced subsequent subsection "for 1144(b)(2)(B) (emphasis added). By exempting apply deemer makes explicit intention Unless unnecessary reality accomplish end, find argument unpersuasive. 31 Initially, clause" modifies it, purports distinguish innovative laws. presumption pre-emption, inclined limitations into enlarge pre-emptive scope. Further, indication distinction mind. 32 assert matters way sold, innovations properly seen save. reads out entirely, instance. Because need "saved" could operate guard expansive readings included wholly plans.17 Appellants' construction, view, renders redundant construing, precedes, little recommend it.18 33 historically conceptually inaccurate indicated, mid-70's, considered ERISA.19 case strongly supports regarding falls squarely 34 Cases interpreting identified three criteria determining Act's insurance": "first, transferring spreading policyholder's risk; second, integral insured; third, entities industry." Union Co. Pireno, 119, 129, 3002, 3008, 647 (1982) original). Royal Drug 440 205, 99 1067, 261 (1979). Application principles 35 obviously risk: effectuate shared. 50a-51a. evident policyholder policyholder. third criterion present Act:20 36 "Congress concerned [in Act] centers around insured, issued, reliability, interpretation, enforcement—these core 'business insurance.' [T]he focus [of term] Statutes aimed protecting relationship, indirectly, SEC Securities, 393 453, 460, 89 564, 568, 668 (1969) 37 contrary suggesting short, clause.21 38 discussion indeed all.22 versions dealing subjects significantly broadened minute, form, explanation Conference Committee, new prominence rewritten conflict provision.23 complete absence evidence suggested here. call attention few passing references record floor debate clause,24 far frail support rest unnatural 39 decline itself it. If "regulates do, pre-empted. structure, Court's regulations speculative 40 results uninsured leaving open latter not. doing life created chosen alter.25 eliminate disuniformities facing national enter markets disuniformities, inevitable result congressional "save" Arguments wisdom choices directed Congress. IV 41 provision. Still, analysis, '[t]he ultimate touchstone.' Malone White Motor Corp., 435 497, 98 1185, 1190, 55 443 (1978), quoting Retail Clerks Schermerhorn, 375 96, 103, 84 219, 222, 179 (1963). Where enactments explicit, "courts sustain 'unless frustrate scheme, courts totality circumstances sought occupy field exclusion States.' Allis-Chalmers Corp. Lueck, 202, 209, 1904, 1910, 206 (1985) 1190. 42 contend whose arrived through wished purchase, agreements. correctly "[b]ecause control plans." More precisely, faced forced make choice: benefit, all, self-insured, assuming position choice. 43 becomes forbidden leave forces, Board (NLRB), 44 articulated distinct principles. Garmon rule, San Diego Building Trades Council Garmon, 359 236, 79 773, 775 (1959), primary jurisdiction NLRB determine instance prohibited NLRA.26 prohibit regulatory NLRB, silent 45 doctrine designed, least initially, govern questions arose activity arguably 8(a)(1) unfair 8(b) 157, 158(a)(1) (b). pre-emption. Telephone Dept., 529-531, 1328, 1335-1336, 553 (1979) (plurality opinion).27 46 Teamsters Morton, 377 252, 1253, 280 (1964), struck down Ohio secondary boycott ruled allowed deprive self-help weapon permitted "the determination available, upset balance management expressed policy." 260, 1258. Similarly, Machinists Wisconsin Employment Comm'n, 427 132, 96 2548, 396 (1976), penalize concerted refusal work overtime left 'to controlled forces.' 140, 2553, Nash-Finch 404 138, 144, 92 373, 377, 328 (1971). 47 recently, divided struggled feature York's unemployment-insurance payments striking workers. supra. "altered management." 532, 1337 opinion). Justices pre-empted, Social 1935, along legislation, decided permit pay unemployment strikers.28 48 rely how regulated, unregulated: "The relationship. 'For impinge combat quite obstruction declare picketing methods prohibits.' 554, 1348 (dissenting opinion), Garner Teamsters, 346 485, 500, 74 161, 171, L.Ed. 228 (1953). All understand involve Here, alters contract. Instead, establish prevent establishing negotiate federally positions, lower level permissible authorized enactment. Chemical Alkali Workers Pittsburgh Plate Glass 159, n. 383, 387, 341 (1971), never enact urge parties.29 52 assume concern about terms. means allow fairly. interferes end is, worse Thus, argued, fortiori like Machinists, Telephone. 53 past, Algoma Plywood Board, 336 301, 312, 69 584, 590, 93 691 (1949), surface plausibility argument, finds dicta decisions. Oliver, 358 283, 295-296, 297, 304, 312 (1959); 525-526, 1907. Upon close C 54 apparently consider pre-empted.30 That so, construe impact wider contours Belknap, Hale, 491, 520, 4, 3172, 3188, 798 (1983) (opinion concurring judgment). primarily equitable process conditions employment, bargain negotiating positions. Cox, Recent Developments Preemption, St.L.J. 277, 297 (1980). declared remedy "[t]he inequality possess full freedom association actual liberty contract, organized corporate forms ownership association." 151. section notes desirability "restoring equality power," among ways, "by encouraging association, self-organization, designation representatives own choosing, mutual aid protection." 56 One goals resolution problem "depress[ed] wage rates earners industry," 151, widening gap wages profits," Cong.Rec. 2371 (1935) (remarks Sen. Wagner), thought cause depression.31 hoped procedures 57 evil addressing entirely employment. Neither resultant depressed having No incompatibility exists, rules restore power, legislation long 58 Accordingly, argued successfully unionized employees. See, e.g., Barrentine Arkansas-Best Freight System, 450 728, 737, 739, 1437, 1443-1444, 67 641 Cf. Alexander Gardner-Denver 415 36, 51, 94 1011, 1021, 147 (1974). ever fit exclude standards. believe treated differently equally, "designed specific receive" Barrentine, 1444 inadvertently Rather, "independent [that] devolve [employees] workers, members organization." 745, 1447. forbids unilaterally. "Such rule delegate whatever disfavored." 212, 1911-1912. turn animated Wagner head penalized join preventing benefiting imposing employers. D 61 Most significantly, myriad existence standards, self-organization. traditionally great latitude powers legislate protection lives, limbs, comfort, quiet persons.' Slaughter-House Cases, Wall. 62, 394 (1873), Thorpe Rutland Burlington R. Vt. 149 (1855). "States protect State. Child occupational safety examples." DeCanas Bica, 424 351, 356, 933, 937, (1976). contribute workmen's compensation funds, prescribing holidays, payment spent polls jury duty withstood scrutiny. Day-Brite Lighting, Missouri, 342 421, 72 405, L.Ed (1952). 62 interstitial, supplementing compatible, supplanting prevents accomplishment Hines Davidowitz, 52, 67, 20, 399, 404, 581 (1941); Electrical Bd., 315 740, 749-751, 820, 825-826, 86 1154 (1942); 1189. Thus "cannot touches complex interrelationships employees, employers, unions; obviously, States." Coach Employees Lockridge, 403 274, 289, 91 1909, 1919, 473 "A holding precluded acting remove backdrop thereby artifically create no-law area." Taggart Weinacker's, 397 223, 228, 90 876, 878, 2d 240 (1970) (concurring opinion) 63 similar pre-ERISA funding vesting levels reasons here: 64 "There doubt governing relations, wages, hours, proper compulsory expressly forecloses issues, bargaining." 504-505, 1190.32 65 less wealthy adequate many rights V 66 hold ordered. POWELL took cases. Association America, 1982-1983 Source Book Data 4-7 (1984 Update). commercial service corporations Blue Cross-Blue Shield. Laws include, solvency qualification aspects transacting claims practices rates. addition grace periods conversion privileges. Brummond, Preemption Regulation Iowa L.Rev. 57, 81-84, varieties common. appeared 1971 1972, enactment 1974. Ariz.Rev.Stat.Ann. 20-1402(4)(b) (1975) (enacted 1971); Conn.Gen.Stat. 38-174d (Supp.1985) Ill.Rev.Stat., 73, ¶ 979(7) (Supp.1984-1985) 1972); Wis.Laws, 325 (superseded). L.Rev., 82-84, 101. wide longstanding provisions. Hardison, 199 190, N.E. 410 (1908) (upholding provisions); Md.Ann.Code, Art. 48A, 410(a)(5) (law enacted 1956 inclusion death suicide occurring issuance policy). California Automobile Inter-Insurance Bureau Maloney, 105, 71 601, 95 788 (1951) participate assigned-risk pool assure availability insurance). Like States, mandates insureds 113A 1972 Supp.1985). Brief American Public al. Amici Curiae A7-A10 (APHA brief) (listing statutes). 108.2(a)(3) 1972) 1962). APHA brief 1A-6A approximately America Amicus Support Statements 1a-2a offered optometrist plan. 4a According promulgated 1a-2a; Wayne Chemical, Columbus Agency Service 426 F.Supp. 316, 324, (ND Ill.) (citing States), aff'd modified, 567 F.2d 692 (CA7 1977). Different alcoholism 38-262b (Supp.1985), others birth-defect 477X (Supp.1984), kidney-dialysis Rev.Code Ann. 3923.25 reconstructive surgery mastectomies, 20-1402(5) (Supp.1984-1985). reads: "Any blanket employees' fund expense renewed persons commonwealth shall, arising nervous described nomenclature Psychiatric following requirements: "(a) based period payable sixty calendar year. "(b) licensed accredited out-patient cover, five hundred dollars twelve-month period, furnished (1) organization, (2) (3) approval department center clinic day furnishes (4) consultations diagnostic sessions ." Answer &Par; 8-14, 51-52. Stipulation 1-11, 459-462. Complaint, Second Third Defenses, 53-54. 9, 461-462. self-insured "be company" tried directly, conceding 12, 462. challenged severable pertaining 601-602, 1225. Metropolitan, appeal Travelers, 84-356, separately emphasizes division tactical choice; indicates product "[v]irtually all" technically Stipulation, 8, 11, consolidated appeals Long problem, commentators recommended amend clarify intentions. Manno, Act: Need Congressional Action, Temp.L.Q. (1979); Okin, A.B.A. Forum 652, 678 (1978). Congress, too, problem. bill introduced 1979 S. 96th Cong., 1st Sess., 125 937 overrule Wadsworth Whaland, 562 70 (CA1 1977), cert. denied, 980, 1630, Hampshire 947 Javits). reported Senate, died debated. Senate Resources, Legislative Calendar 108, 111 (final ed., Jan. 1981). unacceptable. 23, infra. Nearly every 692, 700 1977); F.2d, 77; Eversole 500 1162, 1168-1170 (CD Cal.1980); Insurers' Action Council, Heaton, 423 921, 926 (Minn.1976); Comm'r 296 Md. 334, 344-345, A.2d 793, (1983); 119 N.H. 894, 900-902, 635, 639-640 Progressive Corcoran, 715 784, 787 (CA2 1983). Michigan United Food Commercial Baerwaldt, 572 943 (ED Mich.1983), docketed, 83-1570 (CA6 nn. 2-6, also, Hoopeston Canning Cullen, 318 313, 321, 602, 607, 87 777 (1943) (States "full prescribe [and] insured"); (1951); Md., 340, A.2d, 796 cases). Temp.L.Q., 56. 480 (1945) Ferguson) ("A fixing [under Act]"). another well. "primary concern" "ensure ability tax 217-218, 1076, provides: therein, several taxation business." 34, 1012(a). worded "any reservation serve utilize define 514(d) 1144(d), part: "Nothing [ERISA] alter, amend, modify, invalidate, impair, lends ruling Report stated: preemption title I H.R.Conf.Rep. 93-1280, p. 383 18-20, 2900-2901, form bills 1970 led 3589, 91st 14, 116 7284 (1970). fear "state professional associations" hinder development programs "pre-paid legal programs." 120 29197 (1974) Rep. Dent); 29933 Williams); 29949 "potentially conflicting laws." 29942 convened differences House saved. gave significant role, entire sweeping comments Chamber specifically hardly general. 24, disclosed until filed final conferees Report, August report, S.Conf.Rep. 93-1090, day. Cong. Q. Almanac 252 passed 22. 29215-29216, 29963 Dent) ("narrow enumerated"); Williams) eliminating threat regulation"). Javits) (avoiding danger hastily contrived"). 99, 2901, 2904, "not particularly illuminating," lending artificially construction. 104, 2903. analyzing for, unlike 514(d), face reference. 1977 Activity Education difference noninsured plans: "To [certain selling policies] fail meet 'employee plan' [subject clause"], preempted 514, though barred 'products.' H.R.Rep. 94-1785, 48. specify 1981 acted upon. 16, 498-499, 3177, involves balancing controlling remedying effects Board's adjudicate controversies committed will sanction protects. accomplishes creating administrative agency charge detailed enforced interpreted courts. 241-245, 777-779. initially used weapons supra (power terminate replacements hired during strike); (1976) (concerted overtime). validity 539-540, 1340-1341 (state laws). interests, Brown Hotel Employees, 468 502-503, 104 3179, 3185-3186, 82 373 meant appreciation 1340-1341. plurality state-court 1935 payments, insure security State, labor. 532-533, 1337. Two opinions agreed ground. 546 547, 1344. Even accept collectively bargained authorizes imposition, 21, states: "No 1012(a) 1014, chapter manner Act." excepted 1012(b), itself. 1014 meant, instead, codify Polish Alliance 322 643, 1196, 1509 (1944), 1090 Gwynne); 6419 (1944) Allen); 6526 Brehm). question. gradually comprehended "wages, hours employment." 8(d), 158(d). easily anticipated bargain. Cox Seidman, Federalism Relations, Harv.L.Rev. 211, 242 (1950). today failure spread vast masses consuming disrupts continuity operations everyone suffer. piling excess capital reserves plant capacities dead weight whole structure. "[Under program] [e]mployees guaranteed cooperative efforts, Government sufficient flow wages." Hearings 1958 Labor, 74th 34-35 (statement Wagner). context Railway 577, seq.: undertake governmental conditions. Instead seeks reached them. Acts such. "State transportation cannot laid aside. preclude question." Terminal Railroad Trainmen, 6-7, 420, 423, 571 (footnote omitted).

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