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An appellate court in Arizona has ruled that Section 8902(m)(1) of the Federal Employee Health Benefits Act (“FEHBA”), which provides that certain types of FEHBA contract terms preempt state laws, did not preempt the Arizona rule that barred subrogation in personal injury cases and that, as a result, a FEHBA insurer was not entitled to enforce subrogation rights against an injured insured.

The Case 

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