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The logic was that by covering a vasectomy, men are fully covered but by denying female contraceptives, females are partially covered. The court found such alleged discrimination to be the case and held for the female plaintiff.

Cooley v. DaimlerChrysler Corp., 281 F.Supp.2d 979 (E.D. MO. 2004).

Coordination of Benefits

This is another of the seemingly endless Michigan auto medical disputes. The no-fault Michigan auto coverage declared itself to be payer of last resort. This state-related provision conflicted with the ERISA-governed self-funded plan. The court held that the state’s no-fault provision was made null and void by the ERISA preemption rules and held for the ERISA plan.

Allstate Insurance Co. v. My Choice Medical Plan for LDM Technologies, Inc., Supp.2d (E.D. Mich. 2004).


After paying the claims, the plan administrator attempted recovery under the subrogation provision of the plan. The court held for the participant and did not permit the plan to recover under the theory that the recovery was legal and not equitable in nature as required by Great-West v. Knudson.

QuailChoice, Inc. v. Rowland, 367 F.3d 638 (6th Cir. 2004).

Prescription Management

The PBMs of Maine were regulated by the state’s Unfair Prescription Drug Practices Act. The law declared the PBM to have a fiduciary relationship with the plan sponsor and imposed on the PBM the duty to disclose the following:

  • Any conflicted interests

  • Certain data requested by plan sponsor

  • Any financial relationships between the PBM and the drug companies.

Also, tough rules relating to brand-generic substitutions were set forth. The lower court opinion indicates that the preemption of the state law by ERISA, sought by the association of PBMs, will prevail. The litigation will likely have to be decided by the Supreme Court.

Pharmaceutical Care Management Association v. Rowe, 32 EBC 2786 (D.Me. 2004).

Texas HMO Law Preempted

In a unanimous decision, the Supreme Court held that the Texas law dealing with HMO claim denials was ERISA-preempt. The court held that the HMO is not subject to state liability if it denies coverage for a treatment not covered by the plan it administers. In the decision at hand, there was no issue of mixed eligibility v. treatment decisions.

Aetna Health, Inc. v. Davila and CIGNA HealthCare

© 2004 International Foundation of Employee Benefit Plans, Inc. All rights reserved.

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