Supreme Court To Consider Case on Vt. Health Data Collection Law

June 30, 2015 in News

On Monday, the Supreme Court announced it will hear in its next term a case questioning whether a self-funded health insurer is obligated to give certain information to the state of Vermont, Modern Healthcare reports (Schencker, Modern Healthcare, 6/29).

Background on Case

The case — Gobeille v. Liberty Mutual Insurance – centers on the legality of a requirement under Vermont law for self-funded insurers to submit certain information upon request to the state’s database, including:

  • Claims data;
  • Enrollee eligibility; and
  • Other information.

Sixteen states have approved similar legislation.

 

Liberty Mutual argues that under the federal Employee Retirement Income Security Act (PL 93-406), the company and its third-party administrator are exempt from submitting the data.

 

In a brief filed with the Supreme Court in November 2014, Liberty Mutual lawyers argued ERISA pre-empts state law regarding data collection. They wrote, “In addition to protecting the interests of beneficiaries, Congress intended to protect plans and employers with self-funded plans (and, ultimately, employees and beneficiaries as well) from the burdens of complying with conflicting state laws by reserving the field of employee benefit plans for federal regulation.”

 

Meanwhile, Vermont argues state law should take precedence over federal law in this instance. The state said it needs the data to help reduce health care costs and improve quality of care.

 

According to former Vermont Assistant Attorney General Bridget Asay, the state uses payers’ data to:

  • Analyze cost and outcome differences of similar medical procedures;
  • Conduct research on care quality; and
  • Track differences in care utilization by geographic area.

Asay said the state database was not attempting to impose regulations on ERISA plans, but rather to acquire “the same basic information from ERISA plans that all public and private payers provide, to get an accurate, comprehensive picture of the health care market in that state.”

 

Vermont appealed to the Supreme Court after the 2nd U.S. Circuit Court of Appeals ruled ERISA trumps the state law and the insurer’s third-party administrator was not required to submit the data (iHealthBeat, 12/19/14).

Timing

The high court’s next term scheduled to begin in October. The court likely will hear the case in November or December (Modern Healthcare, 6/29). A decision in the case will be made before the end of the court’s next term in June 2016 (Gullo, MyChamplainValley, 6/29).

Reaction

Following the Supreme Court’s announcement, a spokesperson for Liberty Mutual said the company “look[s] forward to” the high court’s “review of this issue” (Modern Healthcare, 6/29).

Vermont Attorney General Bill Sorrell (D) said his office is “committed to defending Vermont’s authority to gather the information it needs to make sound decisions about health care policy” and is “pleased that the federal government agrees that our law is not pre-empted, and look forward to arguing this case at the Supreme Court” (MyChamplainValley, 6/29).

The Supreme Court did not issue any comments on the case, as is usual (Leonard, Courthouse News Service, 6/29).

Decision Could Have National Implications

According to a brief filed with the high court in May by the U.S. Solicitor General’s office, a decision in the case could have national implications.

The brief stated, “With the encouragement of the federal government, other states are establishing similar health care databases to help improve health outcomes for their citizens, and thus the question presented has national importance.” The brief continued, “If States are unable to acquire such data from self-insured ERISA health care plans, their databases will be significantly less comprehensive and thus not as useful in developing health policy at both the state and national levels.”

Steve Wojcik, vice president of public policy at the National Business Group on Health, said the case could have “profound implications” beyond deciding which entity owns the health data involved, which he said should ultimately be employers. For example, he noted some states in the past have attempted to enact various taxes and other assessments on employer health plans without complying with ERISA, which is something states would not be able to do if ERISA trumps state law.

According to Wojcik, a decision in the case “could set a bad precedent down the road … saying that ERISA doesn’t protect against state law in this case” (Modern Healthcare, 6/29).

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