New York personal injury plaintiffs with employer sponsored health plans are shielded from insurance company actions that seek reimbursement from their tort settlements, a federal appellate court has held in an important preemption case.
The U.S. Court of Appeals for the Second Circuit unanimously reversed a trial judge and held that the Employee Retirement Income Security Act of 1974 (ERISA) does not preempt a parallel state law. Consequently, employer-sponsored health plans are blocked by the state law from recovering medical benefits from settlement funds.
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