- The U.S. Supreme Court has taken on Gobeille v. Liberty Mutual Insurance Co. to determine whether self-funded insurers have to provide information such as how much they are paying hospitals and doctors for employee’s medical costs to the state of Vermont.
- At the center of the case is the federal Employer Retirement Income Security Act (ERISA) that protects insurance companies from having to share their data. Liberty Mutual argues ERISA pre-empts state law, and providing information on a national level is burdensome as different states have different regulations.
According to Reuters, 93 million Americans are insured by self-funded plans. Vermont is one of 18 states that have a data collection law for databases that, according to UCLA law professor Allison Hoffman, serve to leverage that data to drive better deals with providers.
The 2nd U.S. Circuit Court of Appeals already ruled ERISA does take precedence over state law, upholding Liberty Mutual’s stand the company shouldn’t be required to provide data to the state.
However, as previously reported in Healthcare Dive, the Supreme Court’s decision could result in additional state reporting requirements for plan administrations, in addition to ERISA.
Nicholas Bagley, a law professor at the Univerisity of Michigan said in a perspective in The New England Journal of Medicine the main question before the court is whether sharing data would somehow end up altering employers’ plans. He said if the U.S. Supreme Court agrees with the appeal court’s earlier decision, self-insured employers nationwide will not have to report anything to the states. “Worse,” he added, “the decision could interfere with other innovative efforts to reduce costs and improve quality.”
In hearing an initial oral argument yesterday, the justices appeared sympathetic to the different requirements of many states for companies that operate on a national level, yet other justices seemed sympathetic to Vermont’s need to collect data, according to Reuters.
Bagley concluded in his article the case’s significance extends beyond states’ authority to regulate group health insurance stating, “In the final estimation, improving population health depends on collective, local efforts to help people stay healthy and get high-value patient-centered care. Allowing large firms to exempt themselves will undermine those collective efforts at a time when they are sorely needed.”
The court will rule on the issue by the end of June.