Rush Prudential HMO, Inc. v. Moran
Encyclopedia
Rush Prudential HMO, Inc. v. Moran, was a decision by the Supreme Court of the United States
, which ruled that the federal Employee Retirement Income Security Act
(ERISA) did not preempt
an Illinois
medical-review statute.
ERISA envisions a national standard for welfare and pension plans so state laws which "relate to" ERISA plans are preempted under Section 514 of ERISA. However, ERISA contains a "savings" clause which saves state laws which regulate insurance under Section 514(b). The statute at issue in Moran regulated insurance, which is one of the functions HMOs perform. Although HMOs provide healthcare as well as insurance, the statute does not require choosing a single or primary function of an HMO. Congress
has long recognized that HMOs are risk-bearing organizations subject to state regulation. Finally, allowing States to regulate the insurance aspects of HMOs will not interfere with the desire of Congress
for uniform national standards under ERISA.
Supreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
, which ruled that the federal Employee Retirement Income Security Act
Employee Retirement Income Security Act
The Employee Retirement Income Security Act of 1974 is an American federal statute that establishes minimum standards for pension plans in private industry and provides for extensive rules on the federal income tax effects of transactions associated with employee benefit plans...
(ERISA) did not preempt
Preemption
-Legal:*Federal preemption, displacement of U.S. state law by U.S. Federal law*"Preemption" is also sometimes used in the United States to refer to the displacing effect state laws might have on ordinances enacted by municipalities, especially in the context of alcoholic beverage laws, gun laws,...
an Illinois
Illinois
Illinois is the fifth-most populous state of the United States of America, and is often noted for being a microcosm of the entire country. With Chicago in the northeast, small industrial cities and great agricultural productivity in central and northern Illinois, and natural resources like coal,...
medical-review statute.
ERISA envisions a national standard for welfare and pension plans so state laws which "relate to" ERISA plans are preempted under Section 514 of ERISA. However, ERISA contains a "savings" clause which saves state laws which regulate insurance under Section 514(b). The statute at issue in Moran regulated insurance, which is one of the functions HMOs perform. Although HMOs provide healthcare as well as insurance, the statute does not require choosing a single or primary function of an HMO. Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
has long recognized that HMOs are risk-bearing organizations subject to state regulation. Finally, allowing States to regulate the insurance aspects of HMOs will not interfere with the desire of Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
for uniform national standards under ERISA.