One of the significant legal issues facing an insurance company that brings a federal lawsuit to recover allegedly improper payments that it has made to a health care provider under an employee benefit plan is whether the carrier’s complaint is preempted by the federal Employee Retirement Income Security Act of 1974 (ERISA). A finding of preemption would doom the action before it has a chance to proceed on the merits.
The recent decision by U.S. District Judge Leonard D. Wexler of the Eastern District of New York in Connecticut General Life Ins. Co. v. Advanced Chiropractic Healthcare1 reinforces the general rule in the U.S. Court of Appeals for the Second Circuit that lawsuits brought in federal court by insurance companies against health care providers that allege fraud or fraudulent misrepresentation, among other things, will not be dismissed on ERISA preemption grounds.
