Opinion ID: 2353693
Heading Depth: 1
Heading Rank: 7

Heading: Connection with

Text: Even when a law does not reference an ERISA plan, it is preempted if it has an impermissible connection with an ERISA plan. Id. at 325, 117 S.Ct. 832. In cases in which it considered whether a state law has a forbidden connection with ERISA plans, the United States Supreme Court has consistently found statutes that mandate[ ] employee benefit structures or their administration are preempted by ERISA section 514(a). Travelers, 514 U.S. at 657-58, 115 S.Ct. 1671 (holding that ERISA section 514(a) does not preempt a New York statute requiring a surcharge on commercial insurers and health management organizations); see also FMC Corp. v. Holliday, 498 U.S. 52, 111 S.Ct. 403, 112 L.Ed.2d 356 (1990) (holding a Pennsylvania statute that precluded reimbursement to an ERISA plan operator from the beneficiary in the event of recovery from a third party to be preempted by ERISA section 514(a)); Shaw, 463 U.S. 85, 103 S.Ct. 2890 (holding that ERISA preempts state laws regulating benefit plans that prohibit discrimination based on pregnancy and that require specific benefits be paid); Alessi v. Raybestos-Manhattan, Inc., 451 U.S. 504, 101 S.Ct. 1895, 68 L.Ed.2d 402 (1981) (finding that New Jersey could not prohibit plans from setting off workers' compensation payments against employees' retirement benefits or pensions). However, nothing in the language of ERISA suggests that Congress sought to displace general health care regulations. Travelers, 514 U.S. at 661, 115 S.Ct. 1671. Notably, a mere influence or an indirect economic effect on an ERISA plan will not trigger section 514(a) preemption. Id. at 659-60, 115 S.Ct. 1671. In applying ERISA section 514(a), the Court of Appeals for the Ninth Circuit has identified a number of factors to aid in determining whether a state law has a connection with ERISA plans: (1) whether the state law regulates the types of benefits of ERISA employee welfare benefit plans; (2) whether the state law requires the establishment of a separate employee benefit plan to comply with the law; (3) whether the state law imposes reporting, disclosure, funding, or vesting requirements for ERISA plans; and (4) whether the state law regulates certain ERISA relationships, including the relationships between an ERISA plan and employer and, to the extent an employee benefit plan is involved, between the employer and employee. Oper. Eng. Health & Welfare v. JWJ Contracting Co., 135 F.3d 671, 678 (9th Cir.1998) (quotation omitted). Significantly, the Third, Fifth, Ninth, and Tenth Circuits also agree that ERISA preempts suits predicated on administrative decisions made while administering an ERISA plan. Bui v. American Telephone & Telegraph Co. Inc., 310 F.3d 1143, 1147-48 & n. 11 (9th Cir.2002). The Ninth Circuit explained that subjecting administrative decisions to individual states' laws would undermine Congress's purpose to have uniform administration of ERISA benefits. [7] Id. at 1148. Courts agree that Congress did not intend for ERISA to preempt state medical malpractice laws, a traditional field of state regulation. Id. at 1147. However, they distinguish between actions taken in the capacity of medical care providers and actions taken in the capacity of plan administrator. Id. at 1147-48 & n. 11. For instance, the Bui court concluded that while the selection and retention of medical providers is an administrative decision preempted by ERISA section 514(a), a negligent-provision-of-services claim is not preempted. Id. at 1148-50. We agree with the analyses adopted by the federal circuit courts and conclude that when a plaintiffs claim is predicated on administrative decisions made in the course of administering an ERISA plan, the claim is necessarily preempted. However, when the conduct complained of is not performed in the capacity of the ERISA plan, plan administrator, or plan agent, these claims are not preempted by ERISA section 514(a) because the relationship with the ERISA plan is too tangential. Extending section 514(a)'s preemption to these claims based on actions taken outside of an ERISA plan's administration would not further Congress's purpose of uniformity and would intrude unduly into matters that fall within the traditional police power of the state.