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undergo detoxifying treatment. However, the insurance company refuses to cover the cost of the treatment to cleanse the body and aid in the treatment of the mental disorder because the insurance company claims that it is not covered and does not require equal coverage under Timothy’s Law. Even if the insurance company was later found to have wrongly withheld this treatment from the individual, under the Spain holding, the individual would not be able to recover damages for their
losses, or even death, as a result of this error.237
Any state law claim
resulting from an employee benefit plan would be preempted by ERISA.238 Therefore, any gaps in coverage permitted under Timothy’s Law increases the likelihood that insurance benefits can be wrongly withheld and damages arising under such errors could be preempted.
Necessity of New Federal Legislation
While ERISA preemption has been the cause of states’ frustration regarding the passing of new employee benefits laws and allowing for remedies under state insurance laws, this was not the intent of Congress
when ERISA was passed.239
“At the time of its enactment, ERISA did
provide an adequate remedy when benefits were wrongfully denied.”240 The current gap in the ability to obtain a remedy for the denial of benefits is “[not attributable] to an overboard application of ERISA’s preemption clause, but rather to [Congress’ failure] to amend ERISA’s civil enforcement provision to keep pace with the changing realities of the health care system.”241
When ERISA was passed in 1974, the predominate type of insurance plan was the traditional fee-for-service plan.242 Under a fee- for-service plan, beneficiaries who were sick or injured would go to their
See Spain, 11 F.3d 129.
See generally, Commercial Mortgage Ins. Inc. v. Citizens Nat’l Bank of Dallas, 526 F.
Supp. 510, 514-19 (D.C. Tex. 1981) (discussing legislative intent of Congress through an examination of the legislative history of ERISA); Gillis v. Hoechst Celanese Corp., 4 F.3d 1137, 1148 (3d Cir. 1993) (citing Firestone Tire & Rubber Co. v. Bruch, 495 U.S. 101, 118) (finding that “Congress’ purpose in enacting the ERISA . . . provisions [was to] ensure that the ‘individual participant knows exactly where he stands with respect to the plan.’”)); Pension Ben. Guar. Corp. v.
A. Gray & Co., 467 U.S. 717, 730-34 (1984) (analyzing Congress’ intent in enacting ERISA); 70
J.S. Pensions § 13 (2006) (explaining that one of the purposes of Congress’ in adopting ERISA
was the furtherance of retirement benefit plans).
Andrews-Clarke v. Travelers Ins. Co., 984 F. Supp. 49, 58 (D. Mass. 1997).
Id. (citing Kent G. Rutter, Democratizing HMO Regulation to Enforce the ‘Rule of
Rescue’, 30 MICH. J. L. REFORM 147, 171 (1996)).