Article by Donald T. Bogan
Prior to Congress's enactment of the Employee Retirement Income Security Act of 1974 (ERISA), the states regulated the health care and health insurance industries. In passing ERISA, Congress intended to reform the pension plan industry and provide comprehensive regulation of pension plans. As a result of Conference Committee action just prior to ERISA's enactment, however, the statute also contains a broad preemption clause that the courts have interpreted to preempt virtually all state regulation of health care benefit plans, not just pension plans. Congress did not investigate the nonpension employee benefits industry when it was considering ERISA; consequently, the statute provides no substantive regulation of nonpension plans. The combined effect of ERISA's failure to regulate nonpension employee benefits and court opinions that declare state regulations that relate to nonpension employee benefit plans preempted is that the managed care health benefits industry remains virtually unregulated, leaving consumers hopelessly unprotected from industry abuses.
Recent Supreme Court decisions recognize that ERISA's preemption language is ambiguous and that the Court's “plain meaning” interpretation of such language has not provided adequate guidance to the lower courts on how to resolve the myriad ERISA preemption issues that continue to flood the lower courts. This Article suggests that application of standard statutory interpretation principles to ERISA's ambiguous preemption language should return the substantive regulation of nonpension employee benefit plans to the states.
About the Author
Donald T. Bogan. Visiting Associate Clinical Professor, University of Oklahoma College of Law. A.B. 1974, Brown University; J.D. 1979, Wake Forest University School of Law.
Citation
74 Tul. L. Rev. 951 (2000)