Gobeille v. Liberty Mutual Insurance Company

136 S. Ct. 936 (2016)

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Nature of the Case

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Facts

D requires certain public and private entities that provide and pay for health care services to report information to a state agency. The reported information is compiled into a database reflecting “all health care utilization, costs, and resources, and health care utilization and costs for services provided to Vermont residents in another state. This is called an all-payer claims database, for it requires the submission of data from all health insurers and other entities that pay for health care services. Almost 20 States have or are implementing similar databases. D’s law requires health insurers, health care providers, health care facilities, and governmental agencies to report any “information relating to health care costs, prices, quality, utilization, or resources required” by the state agency, including data relating to health insurance claims and enrollment. The Plan, which qualifies as an “employee welfare benefit plan” under ERISA, 29 U. S. C. §1002(1), is subject to “ERISA’s comprehensive regulation.” P, as the Plan sponsor, is both a fiduciary and plan administrator. The Plan uses Blue Cross Blue Shield of Massachusetts, Inc. (Blue Cross), as a third-party administrator. The Plan is a voluntary reporter under the Vermont regulation because it covers some 137 Vermonters, which is fewer than the 200-person cutoff for mandated reporting. Blue Cross, however, serves several thousand Vermonters, and so it is a mandated reporter. Blue Cross, therefore, must report the information it possesses about the Plan’s members in Vermont. D issued a subpoena ordering Blue Cross to transmit to a state-appointed contractor all the files it possessed on member eligibility, medical claims, and pharmacy claims for Vermont members. D threatened, would be a fine of up to $2,000 a day and a suspension of Blue Cross’ authorization to operate in Vermont for as long as six months. P concerned in part that the disclosure of confidential information regarding its members might violate its fiduciary duties under the Plan, instructed Blue Cross not to comply. P filed this action in federal court. It sought a declaration that ERISA pre-empts application of D’s statute and regulation to the Plan and an injunction prohibiting D from trying to acquire data about the Plan or its members. The District Court granted summary judgment to D. It held that scheme “may have some indirect effect on health benefit plans,” but it reasoned that the “effect is so peripheral that the regulation cannot be considered an attempt to interfere with the administration or structure of a welfare benefit plan.” The Court of Appeals reversed. It explained that “one of ERISA’s core functions - reporting - [cannot] be laden with burdens, subject to incompatible, multiple and variable demands, and freighted with risk of fines, breach of duty, and legal expense.” D appealed.