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Click here for the full text of this decision FACTS:Xavier Duenez was a state employee who was insured through the Employee Retirement System of Texas (ERS) by Blue Cross Blue Shield of Texas (BCBS). When his daughter was seriously injured in an automobile accident, Duenez sought benefits from BCBS. Initially, BCBS certified that his daughter’s private nursing care was covered, but later informed him that it planned to discontinue the coverage. In response, Xavier and Irene Duenez, individually and as next friends of their daughter, brought suit in district court, seeking a declaratory judgment that the care was covered, and injunctions compelling BCBS to continue payment. The trial court issued a temporary injunction requiring BCBS to continue paying for in-home nursing services. While the suit for permanent relief was pending, the Duenezes switched insurance carriers; consequently, they non-suited all claims except the one for attorney’s fees, which the trial court awarded pursuant to the Declaratory Judgment Act. BCBS appealed, arguing that the trial court lacked subject-matter jurisdiction to award attorney’s fees because the Duenezes failed to exhaust the administrative remedies mandated by the Texas Employees Group Benefits Act (ERS Act). The court of appeals disagreed, holding that ERS’s exclusive jurisdiction was limited to disputes concerning enrollment or payment and that the Duenezes’ suit “relate[d] to the extent of the . . . plan’s coverage.” BCBS appealed to the Texas Supreme Court, arguing that the case should be dismissed for lack of subject-matter jurisdiction. HOLDING:The court granted BCBS’ petition, vacated the court of appeals’ judgment, and dismissed the case for want of jurisdiction. An administrative agency has exclusive jurisdiction when the Legislature grants it the sole authority to make an initial determination in a dispute; in such matters, a complaining party must exhaust administrative remedies before seeking review in district court. Until the party has satisfied the exhaustion requirement, the trial court lacks subject-matter jurisdiction and must dismiss without prejudice those claims within the agency’s exclusive jurisdiction. Whether ERS has exclusive jurisdiction over this dispute is a matter of statutory interpretation. An agency has exclusive jurisdiction when “a pervasive regulatory scheme indicates that [the Legislature] intended for the regulatory process to be the exclusive means of remedying the problem to which the regulation is addressed.” The plain language of the ERS Act, the court stated, makes clear that the administrative appeals process is the exclusive means of resolving a claim for payment of ERS-derived benefits. OPINION:Per curiam.

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