2/4/2009 1:59:19 AM
HOFSTRA LABOR & EMPLOYMENT LAW JOURNAL
statute provided that “a health insurer shall not discriminate against any provider who is located within the geographic coverage area of the health benefit plan and who is willing to meet the terms and conditions for participation established by the health insurer, including the Kentucky state Medicaid program and Medicaid partnerships.”178 The second statute required that “[a] health benefit plan that includes chiropractic benefits shall . . . [p]ermit any licensed chiropractor who agrees to abide by the terms, conditions, reimbursement rates, and standards of quality of the health benefit plan to serve as a participating primary chiropractic provider to any person covered by the plan.” 179
A group of Kentucky HMOs filed suit against the Commissioner of Kentucky’s Department of Insurance, in the Eastern District of Kentucky requesting AWP statutes be declared preempted by ERISA. Following the District Court’s grant of partial summary judgment to 180
defendant,181 and affirmation by the Court of Appeals,182 successfully petitioned for a writ of certiorari. 183
Justice Scalia, delivering the opinion for a unanimous Court, affirmed the judgment of the Court of Appeals, holding that the AWP
existing ERISA preemption test from a straightforward two-part analysis:
[F]or a state law to be deemed a ‘law . . . which regulates insurance’ under ERISA’s savings clause, it must satisfy two requirements. First, the state law must be specifically directed toward entities engaged in insurance. Second, the state law must substantially affect the risk pooling arrangement between the insurer and the insured. 185
This two-part preemption analysis has been applied to challenges to other states’ mental parity laws that appear to be directed toward insurance companies, and these statutes have survived preemption. 186
Health Maint. Org. Ass’n of Ky., Inc. v. Nichols, No. Civ. A. 97-24, 1998 WL 34103663,
at *1 (E.D. Ky. Aug. 6, 1998) aff’d sub nom. Ky. Ass’n of Health Plans, Inc. v. Nichols, 227 F.3d 352 (6th Cir. (2000), aff’d sub nom. Miller, 538 U.S. 329.
Id. at *10.
Ky. Ass'n of Health Plans, 227 F.3d at 372, aff’d sub nom. Miller, 538 U.S. 329.
Petition for Writ of Certiorari, Ky. Ass’n of Health Plans, 536 U.S. 956 (No. 00-1471).
Miller, 538 U.S. at 334, 341-42.
Id. at 341-42 (citations omitted).
See, e.g., Thompkins v. BC Life & Health Ins. Co., 414 F. Supp. 2d 953, 958 n.4 (C.D.