Not a Lexis Advance subscriber? Try it out for free.

Empire HealthChoice Assur., Inc. v. McVeigh

Supreme Court of the United States

April 25, 2006, Argued ; June 15, 2006, Decided

No. 05-200

Opinion

 [*682]  [**2126]   Justice Ginsburg delivered the opinion of the Court.

The Federal Employees Health Benefits Act of 1959 (FEHBA), 5 U.S.C. § 8901 et seq. (2000 ed. and Supp. III), establishes a comprehensive program of health insurance for federal employees. The Act authorizes the Office of Personnel Management (OPM) to contract with private carriers to offer federal employees an array of health-care plans. See § 8902(a) (2000 ed.). Largest [****14]  of the plans for which OPM has contracted, annually since 1960,  [**2127]  is the Blue Cross Blue Shield Service Benefit Plan (Plan), administered by local Blue Cross Blue Shield companies. This case concerns the proper forum for reimbursement claims when a Plan beneficiary, injured in an accident, whose medical bills have been paid by the Plan administrator, recovers damages (unaided by the carrier-administrator) in  [***139]  a state-court tort action against a third party alleged to have caused the accident.

 [*683]  FEHBA contains a preemption clause, § 8902(m)(1), displacing state law on issues relating to "coverage or benefits" afforded by health-care plans. The Act contains no provision addressing the subrogation or reimbursement rights of carriers. Successive annual contracts between OPM and the Blue Cross Blue Shield Association (BCBSA) have obligated the carrier to make "a reasonable effort" to recoup amounts paid for medical care. App. 95, 125. The statement of benefits distributed by the carrier alerts enrollees that all recoveries they receive "must be used to reimburse the Plan for benefits paid." Id., at 132; see also id., at 146, 152.

The instant case originated when the administrator [****15]  of a Plan beneficiary's estate pursued tort litigation in state court against parties alleged to have caused the beneficiary's injuries. The carrier had notice of the state-court action, but took no part in it. When the tort action terminated in a settlement, the carrier filed suit in federal court seeking reimbursement of the full amount it had paid for the beneficiary's medical care. The question presented is whether 28 U.S.C. § 1331 (authorizing jurisdiction over "civil actions arising under the . . . laws . . . of the United States") encompasses the carrier's action. We hold it does not.

Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.

Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.

547 U.S. 677 *; 126 S. Ct. 2121 **; 165 L. Ed. 2d 131 ***; 2006 U.S. LEXIS 4679 ****; 74 U.S.L.W. 4338; 37 Employee Benefits Cas. (BNA) 2729; 19 Fla. L. Weekly Fed. S 265

EMPIRE HEALTHCHOICE ASSURANCE, INC., DBA EMPIRE BLUE CROSS BLUE SHIELD, Petitioner v. DENISE F. McVEIGH, AS ADMINISTRATRIX OF THE ESTATE OF JOSEPH E. McVEIGH

Prior History:  [****1] ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT.

 Empire Healthchoice Assur., Inc. v. McVeigh, 396 F.3d 136, 2005 U.S. App. LEXIS 751 (2d Cir. N.Y., 2005)

Disposition: Affirmed.

CORE TERMS

carrier, state law, benefits, federal common law, federal court, federal law, OPM, reimbursement, provisions, cases, federal jurisdiction, contracts, enrollee, reimbursement claim, federal employee, federal rule, Transit, terms, carrier's contract, federal government, federal agency, displacement, employees, brochure, federal statute, coverage, rights, health benefits, plans, federal claim

Healthcare Law, Insurance Coverage, Health Insurance, Federal Employees Health Benefits Act, Civil Procedure, Jurisdiction, Jurisdictional Sources, Statutory Sources, Governments, Federal Government, Claims By & Against, Courts, Courts of Claims, Subject Matter Jurisdiction, Federal Questions, General Overview, Federal & State Interrelationships, Federal Common Law, Applicability, Public Contracts Law, Dispute Resolution, Preemption, Legislation, Interpretation