OPINION OF THE COURT
AETNA HEALTH INC. V. DAVILA
542 U. S. ____ (2004)
SUPREME COURT OF THE UNITED STATES
NOS. 02-1845 AND 03-83
AETNA HEALTH INC., fka AETNA U. S. HEALTHCARE INC.
and AETNA U. S. HEALTHCARE OF NORTH TEXAS INC., PETITIONER
02–1845
v.
JUAN DAVILA
CIGNA HEALTHCARE OF TEXAS, INC., dba CIGNA
CORPORATION, PETITIONER
03–83
v.
RUBY R. CALAD et al.
on writs of certiorari to the united states
court of appeals for the fifth circuit
[June 21, 2004]
Justice Thomas delivered
the opinion of the Court.
In these consolidated cases, two
individuals sued their respective health maintenance organizations
(HMOs) for alleged failures to exercise ordinary care in the
handling of coverage decisions, in violation of a duty imposed by
the Texas Health Care Liability Act (THCLA), Tex. Civ. Prac. &
Rem. Code Ann. §§88.001–88.003 (2004 Supp. Pamphlet). We granted
certiorari to decide whether the individuals’ causes of action are
completely pre-empted by the “interlocking, interrelated, and
interdependent remedial scheme,”
Massachusetts Mut. Life Ins.
Co. v.
Russell, 473 U. S. 134, 146
(1985), found at §502(a) of the Employee Retirement Income Security
Act of 1974 (ERISA), 88 Stat. 891, as amended, 29 U. S. C.
§1132(a)
et seq.
540 U. S. 981 (2003). We
hold that the causes of action are completely pre-empted and hence
removable from state to federal court. The Court of Appeals, having
reached a contrary conclusion, is reversed.
I
A
Respondent Juan Davila is a
participant, and respondent Ruby Calad is a beneficiary, in
ERISA-regulated employee benefit plans. Their respective plan
sponsors had entered into agreements with petitioners, Aetna Health
Inc. and CIGNA Healthcare of Texas, Inc., to administer the plans.
Under Davila’s plan, for instance, Aetna reviews requests for
coverage and pays providers, such as doctors, hospitals, and
nursing homes, which perform covered services for members; under
Calad’s plan sponsor’s agreement, CIGNA is responsible for plan
benefits and coverage decisions.
Respondents both suffered
injuries allegedly arising from Aetna’s and CIGNA’s decisions not
to provide coverage for certain treatment and services recommended
by respondents’ treating physicians. Davila’s treating physician
prescribed Vioxx to remedy Davila’s arthritis pain, but Aetna
refused to pay for it. Davila did not appeal or contest this
decision, nor did he purchase Vioxx with his own resources and seek
reimbursement. Instead, Davila began taking Naprosyn, from which he
allegedly suffered a severe reaction that required extensive
treatment and hospitalization. Calad underwent surgery, and
although her treating physician recommended an extended hospital
stay, a CIGNA discharge nurse determined that Calad did not meet
the plan’s criteria for a continued hospital stay. CIGNA
consequently denied coverage for the extended hospital stay. Calad
experienced postsurgery complications forcing her to return to the
hospital. She alleges that these complications would not have
occurred had CIGNA approved coverage for a longer hospital
stay.
Respondents brought separate suits in Texas
state court against petitioners. Invoking THCLA §88.002(a),
respondents argued that petitioners’ refusal to cover the requested
services violated their “duty to exercise ordinary care when making
health care treatment decisions,” and that these refusals
“proximately caused” their injuries.
Ibid. Petitioners
removed the cases to Federal District Courts, arguing that
respondents’ causes of action fit within the scope of, and were
therefore completely pre-empted by, ERISA §502(a). The respective
District Courts agreed, and declined to remand the cases to state
court. Because respondents refused to amend their complaints to
bring explicit ERISA claims, the District Courts dismissed the
complaints with prejudice.
B
Both Davila and Calad appealed
the refusals to remand to state court. The United States Court of
Appeals for the Fifth Circuit consolidated their cases with several
others raising similar issues. The Court of Appeals recognized that
state causes of action that “duplicat[e] or fal[l] within the scope
of an ERISA §502(a) remedy” are completely pre-empted and hence
removable to federal court.
Roark v.
Humana,
Inc., 307 F. 3d 298, 305 (2002) (internal quotation marks
and citations omitted). After examining the causes of action
available under §502(a), the Court of Appeals determined that
respondents’ claims could possibly fall under only two:
§502(a)(1)(B), which provides a cause of action for the recovery of
wrongfully denied benefits, and §502(a)(2), which allows suit
against a plan fiduciary for breaches of fiduciary duty to the
plan.
Analyzing §502(a)(2) first, the
Court of Appeals concluded that, under
Pegram v.
Herdrich, 530 U. S. 211 (2000), the decisions
for which petitioners were being sued were “mixed eligibility and
treatment decisions” and hence were not fiduciary in nature. 307
F. 3d, at 307–308.[
Footnote
1] The Court of Appeals next determined that respondents’
claims did not fall within §502(a)(1)(B)’s scope. It found
significant that respondents “assert tort claims,” while
§502(a)(1)(B) “creates a cause of action for breach of contract,”
id., at 309, and also that respondents “are not seeking
reimbursement for benefits denied them,” but rather request “tort
damages” arising from “an external, statutorily imposed duty of
‘ordinary care.’ ”
Ibid. From
Rush Prudential
HMO, Inc. v.
Moran, 536 U. S. 355 (2002),
the Court of Appeals derived the principle that complete
pre-emption is limited to situations in which “States … duplicate
the causes of action listed in ERISA §502(a),” and concluded that
“[b]ecause the THCLA does not provide an action for collecting
benefits,” it fell outside the scope of §502(a)(1)(B). 307
F. 3d, at 310–311.
II
A
Under the removal statute, “any
civil action brought in a State court of which the district courts
of the United States have original jurisdiction, may be removed by
the defendant” to federal court. 28 U. S. C. §1441(a). One
category of cases of which district courts have original
jurisdiction are “federal question” cases: cases “arising under the
Constitution, laws, or treaties of the United States.” §1331. We
face in these cases the issue whether respondents’ causes of action
arise under federal law.
Ordinarily, determining whether a
particular case arises under federal law turns on the
“ ‘well-pleaded complaint’ ” rule.
Franchise Tax Bd.
of Cal. v.
Construction Laborers Vacation Trust for
Southern Cal., 463 U. S. 1, 9–10 (1983).
The Court has explained that
“whether a case is one arising under the
Constitution or a law or treaty of the United States, in the sense
of the jurisdictional statute[,] … must be determined from what
necessarily appears in the plaintiff’s statement of his own claim
in the bill or declaration, unaided by anything alleged in
anticipation of avoidance of defenses which it is thought the
defendant may interpose.”
Taylor v.
Anderson, 234 U. S. 74, 75–76
(1914).
In particular, the existence of a federal defense
normally does not create statutory “arising under” jurisdiction,
Louisville & Nashville R. Co. v.
Mottley, 211 U. S. 149 (1908),
and “a defendant may not [generally] remove a case to federal court
unless the
plaintiff’s complaint establishes that the case
‘arises under’ federal law.”
Franchise Tax Bd.,
supra, at 10. There is an exception, however, to the
well-pleaded complaint rule. “[W]hen a federal statute wholly
displaces the state-law cause of action through complete
pre-emption,” the state claim can be removed.
Beneficial Nat.
Bank v.
Anderson,
539 U. S. 1, 8 (2003).
This is so because “[w]hen the federal statute completely pre-empts
the state-law cause of action, a claim which comes within the scope
of that cause of action, even if pleaded in terms of state law, is
in reality based on federal law.”
Ibid. ERISA is one of
these statutes.
B
Congress enacted ERISA to
“protect … the interests of participants in employee benefit plans
and their beneficiaries” by setting out substantive regulatory
requirements for employee benefit plans and to “provid[e] for
appropriate remedies, sanctions, and ready access to the Federal
courts.” 29 U. S. C. §1001(b). The purpose of ERISA is to
provide a uniform regulatory regime over employee benefit plans. To
this end, ERISA includes expansive pre-emption provisions, see
ERISA §514, 29 U. S. C. §1144, which are intended to ensure
that employee benefit plan regulation would be “exclusively a
federal concern.”
Alessi v.
Raybestos-Manhattan,
Inc.,
451 U. S.
504, 523 (1981).
ERISA’s “comprehensive
legislative scheme” includes “an integrated system of procedures
for enforcement.”
Russell, 473 U. S., at 147 (internal
quotation marks and citation omitted). This integrated enforcement
mechanism, ERISA §502(a), 29 U. S. C. §1132(a), is a
distinctive feature of ERISA, and essential to accomplish Congress’
purpose of creating a comprehensive statute for the regulation of
employee benefit plans. As the Court said in
Pilot Life Ins.
Co. v.
Dedeaux, 481 U. S. 41 (1987):
“[T]he detailed provisions of §502(a) set forth a
comprehensive civil enforcement scheme that represents a careful
balancing of the need for prompt and fair claims settlement
procedures against the public interest in encouraging the formation
of employee benefit plans. The policy choices reflected in the
inclusion of certain remedies and the exclusion of others under the
federal scheme would be completely undermined if ERISA-plan
participants and beneficiaries were free to obtain remedies under
state law that Congress rejected in ERISA. ‘The six carefully
integrated civil enforcement provisions found in §502(a) of the
statute as finally enacted … provide strong evidence that Congress
did
not intend to authorize other remedies that it simply
forgot to incorporate expressly.’ ”
Id., at 54
(quoting
Russell,
supra, at 146).
Therefore, any state-law cause of action that
duplicates, supplements, or supplants the ERISA civil enforcement
remedy conflicts with the clear congressional intent to make the
ERISA remedy exclusive and is therefore pre-empted. See 481 U. S.,
at 54–56; see also
Ingersoll-Rand Co. v.
McClendon, 498 U. S. 133, 143–145 (1990).
The pre-emptive force of ERISA §502(a) is
still stronger. In
Metropolitan Life Ins. Co. v.
Taylor, 481 U. S. 58, 65–66 (1987), the Court
determined that the similarity of the language used in the Labor
Management Relations Act, 1947 (LMRA), and ERISA, combined with the
“clear intention” of Congress “to make §502(a)(1)(B) suits brought
by participants or beneficiaries federal questions for the purposes
of federal court jurisdiction in like manner as §301 of the LMRA,”
established that ERISA §502(a)(1)(B)’s pre-emptive force mirrored
the pre-emptive force of LMRA §301. Since LMRA §301 converts state
causes of action into federal ones for purposes of determining the
propriety of removal, see
Avco Corp. v.
Machinists,
390 U. S. 557 (1968), so
too does ERISA §502(a)(1)(B). Thus, the ERISA civil enforcement
mechanism is one of those provisions with such “extraordinary
pre-emptive power” that it “converts an ordinary state common law
complaint into one stating a federal claim for purposes of the
well-pleaded complaint rule.”
Metropolitan Life, 481 U.
S., at 65–66
. Hence, “causes of action within the scope of
the civil enforcement provisions of §502(a) [are] removable to
federal court.”
Id., at 66.
III
A
ERISA §502(a)(1)(B) provides:
“A civil action may be brought—(1) by a participant
or beneficiary— … (B) to recover benefits due to him under the
terms of his plan, to enforce his rights under the terms of the
plan, or to clarify his rights to future benefits under the terms
of the plan.” 29 U. S. C. §1132(a)(1)(B).
This provision is relatively straightforward. If a
participant or beneficiary believes that benefits promised to him
under the terms of the plan are not provided, he can bring suit
seeking provision of those benefits. A participant or beneficiary
can also bring suit generically to “enforce his rights” under the
plan, or to clarify any of his rights to future benefits. Any
dispute over the precise terms of the plan is resolved by a court
under a
de novo review standard, unless the terms of the
plan “giv[e] the administrator or fiduciary discretionary authority
to determine eligibility for benefits or to construe the terms of
the plan.”
Firestone Tire & Rubber Co. v.
Bruch,
489
U. S. 101, 115 (1989).
It follows that if an individual brings suit
complaining of a denial of coverage for medical care, where the
individual is entitled to such coverage only because of the terms
of an ERISA-regulated employee benefit plan, and where no legal
duty (state or federal) independent of ERISA or the plan terms is
violated, then the suit falls “within the scope of” ERISA
§502(a)(1)(B).
Metropolitan Life,
supra, at 66.
In other words, if an individual, at some point in time, could have
brought his claim under ERISA §502(a)(1)(B), and where there is no
other independent legal duty that is implicated by a defendant’s
actions, then the individual’s cause of action is completely
pre-empted by ERISA §502(a)(1)(B).
To determine whether respondents’ causes of
action fall “within the scope” of ERISA §502(a)(1)(B), we must
examine respondents’ complaints, the statute on which their claims
are based (the THCLA), and the various plan documents. Davila
alleges that Aetna provides health coverage under his employer’s
health benefits plan. App. H to Pet. for Cert. in No. 02–1845,
p. 67a, ¶ ;11. Davila also alleges that after his primary care
physician prescribed Vioxx, Aetna refused to pay for it.
Id., at 67a, ¶ ;12. The only action complained of was
Aetna’s refusal to approve payment for Davila’s Vioxx prescription.
Further, the only relationship Aetna had with Davila was its
partial administration of Davila’s employer’s benefit plan. See
App. 25, 31, 39–40, 45–48, 108.
Similarly, Calad alleges that she receives, as
her husband’s beneficiary under an ERISA-regulated benefit plan,
health coverage from CIGNA.
Id., at 184, ¶ ;17. She
alleges that she was informed by CIGNA, upon admittance into a
hospital for major surgery, that she would be authorized to stay
for only one day.
Id., at 184, ¶ ;18. She also alleges
that CIGNA, acting through a discharge nurse, refused to authorize
more than a single day despite the advice and recommendation of her
treating physician.
Id., at 185, ¶ ;¶ ;20, 21. Calad
contests only CIGNA’s decision to refuse coverage for her hospital
stay.
Id., at 185, ¶ ;20. And, as in Davila’s case, the
only connection between Calad and CIGNA is CIGNA’s administration
of portions of Calad’s ERISA-regulated benefit plan.
Id.,
at 219–221.
It is clear, then, that respondents complain
only about denials of coverage promised under the terms of
ERISA-regulated employee benefit plans. Upon the denial of
benefits, respondents could have paid for the treatment themselves
and then sought reimbursement through a §502(a)(1)(B) action, or
sought a preliminary injunction, see
Pryzbowski v.
U.
S. Healthcare, Inc., 245 F. 3d 266, 274 (CA3 2001)
(giving examples where federal courts have issued such preliminary
injunctions).[
Footnote 2]
Respondents contend, however, that the
complained-of actions violate legal duties that arise independently
of ERISA or the terms of the employee benefit plans at issue in
these cases. Both respondents brought suit specifically under the
THCLA, alleging that petitioners “controlled, influenced,
participated in and made decisions which affected the quality of
the diagnosis, care, and treatment provided” in a manner that
violated “the duty of ordinary care set forth in §§88.001 and
88.002.” App. H to Pet. for Cert. in No. 02–1845, at 69a, ¶ ;18;
see also App. 187, ¶ ;28. Respondents contend that this duty of
ordinary care is an independent legal duty. They analogize to this
Court’s decisions interpreting LMRA §301, 29 U. S. C. §1081,
with particular focus on
Caterpillar Inc. v.
Williams, 482 U. S. 386 (1987)
(suit for breach of individual employment contract, even if
defendant’s action also constituted a breach of an entirely
separate collective bargaining agreement, not pre-empted by LMRA
§301). Because this duty of ordinary care arises independently of
any duty imposed by ERISA or the plan terms, the argument goes, any
civil action to enforce this duty is not within the scope of the
ERISA civil enforcement mechanism.
The duties imposed by the THCLA in the context
of these cases, however, do not arise independently of ERISA or the
plan terms. The THCLA does impose a duty on managed care entities
to “exercise ordinary care when making health care treatment
decisions,” and makes them liable for damages proximately caused by
failures to abide by that duty. §88.002(a). However, if a managed
care entity correctly concluded that, under the terms of the
relevant plan, a particular treatment was not covered, the managed
care entity’s denial of coverage would not be a proximate cause of
any injuries arising from the denial. Rather, the failure of the
plan itself to cover the requested treatment would be the proximate
cause.[
Footnote 3] More
significantly, the THCLA clearly states that “[t]he standards in
Subsections (a) and (b) create no obligation on the part of the
health insurance carrier, health maintenance organization, or other
managed care entity to provide to an insured or enrollee treatment
which is not covered by the health care plan of the entity.”
§88.002(d). Hence, a managed care entity could not be subject to
liability under the THCLA if it denied coverage for any treatment
not covered by the health care plan that it was administering.
Thus, interpretation of the terms of
respondents’ benefit plans forms an essential part of their THCLA
claim, and THCLA liability would exist here only because of
petitioners’ administration of ERISA-regulated benefit plans.
Petitioners’ potential liability under the THCLA in these cases,
then, derives entirely from the particular rights and obligations
established by the benefit plans. So, unlike the state-law claims
in
Caterpillar,
supra, respondents’ THCLA causes
of action are not entirely independent of the federally regulated
contract itself. Cf.
Allis&nbhyph;Chalmers Corp. v.
Lueck,
471
U. S. 202, 217 (1985) (state-law tort of bad faith handling of
insurance claim pre-empted by LMRA §301, since the “duties imposed
and rights established through the state tort … derive[d] from the
rights and obligations established by the contract”);
Steelworkers v.
Rawson, 495 U. S. 362, 371
(1990) (state-law tort action brought due to alleged negligence in
the inspection of a mine was pre-empted, as the duty to inspect the
mine arose solely out of the collective-bargaining agreement).
Hence, respondents bring suit only to rectify
a wrongful denial of benefits promised under ERISA-regulated plans,
and do not attempt to remedy any violation of a legal duty
independent of ERISA. We hold that respondents’ state causes of
action fall “within the scope of” ERISA §502(a)(1)(B),
Metropolitan Life, 481 U. S., at 66, and are therefore
completely pre-empted by ERISA §502 and removable to federal
district court.[
Footnote 4]
B
The Court of Appeals came to a
contrary conclusion for several reasons, all of them erroneous.
First, the Court of Appeals found significant that respondents
“assert a tort claim for tort damages” rather than “a contract
claim for contract damages,” and that respondents “are not seeking
reimbursement for benefits denied them.” 307 F. 3d, at
309
. But, distinguishing between pre-empted and
non-pre-empted claims based on the particular label affixed to them
would “elevate form over substance and allow parties to evade” the
pre-emptive scope of ERISA simply “by relabeling their contract
claims as claims for tortious breach of contract.”
Allis-Chalmers,
supra, at 211. Nor can the mere
fact that the state cause of action attempts to authorize remedies
beyond those authorized by ERISA §502(a) put the cause of action
outside the scope of the ERISA civil enforcement mechanism. In
Pilot Life,
Metropolitan Life, and
Ingersoll-Rand, the plaintiffs all brought state claims
that were labeled either tort or tort-like. See
Pilot
Life, 481 U. S., at 43 (suit for,
inter alia,
“Tortious Breach of Contract”);
Metropolitan Life,
supra, at 61–62 (suit requesting damages for “mental
anguish caused by breach of [the] contract”);
Ingersoll-Rand, 498 U. S., at 136 (suit brought under
various tort and contract theories). And, the plaintiffs in these
three cases all sought remedies beyond those authorized under
ERISA. See
Pilot Life,
supra, at 43 (compensatory
and punitive damages);
Metropolitan Life,
supra,
at 61 (mental anguish);
Ingersoll-Rand,
supra, at
136 (punitive damages, mental anguish). And, in all these cases,
the plaintiffs’ claims were pre-empted. The limited remedies
available under ERISA are an inherent part of the “careful
balancing” between ensuring fair and prompt enforcement of rights
under a plan and the encouragement of the creation of such plans.
Pilot Life,
supra, at 55.
Second, the Court of Appeals
believed that “the wording of [respondents’] plans is immaterial”
to their claims, as “they invoke an external, statutorily imposed
duty of ‘ordinary care.’ ” 307 F. 3d, at 309. But as we
have already discussed, the wording of the plans is certainly
material to their state causes of action, and the duty of “ordinary
care” that the THCLA creates is not external to their rights under
their respective plans.
Ultimately, the Court of Appeals rested its
decision on one line from
Rush Prudential. There, we
described our holding in
Ingersoll-Rand as follows:
“[W]hile state law duplicated the elements of a claim available
under ERISA, it converted the remedy from an equitable one under
§1132(a)(3) (available exclusively in federal district courts) into
a legal one for money damages (available in a state tribunal).” 536
U. S., at 379. The point of this sentence was to describe why the
state cause of action in
Ingersoll-Rand was pre-empted by
ERISA §502(a): It was pre-empted because it attempted to convert an
equitable remedy into a legal remedy. Nowhere in
Rush
Prudential did we suggest that the pre-emptive force of ERISA
§502(a) is limited to the situation in which a state cause of
action precisely duplicates a cause of action under ERISA
§502(a).
Nor would it be consistent with our precedent
to conclude that only strictly duplicative state causes of action
are pre-empted. Frequently, in order to receive exemplary damages
on a state claim, a plaintiff must prove facts beyond the bare
minimum necessary to establish entitlement to an award. Cf.
Allis-Chalmers, 471 U. S., at 217 (bad-faith refusal to
honor a claim needed to be proved in order to recover exemplary
damages). In order to recover for mental anguish, for instance, the
plaintiffs in
Ingersoll-Rand and
Metropolitan
Life would presumably have had to prove the existence of
mental anguish; there is no such element in an ordinary suit
brought under ERISA §502(a)(1)(B). See
Ingersoll-Rand,
supra, at 136;
Metropolitan Life,
supra,
at 61. This did not save these state causes of action from
pre-emption. Congress’ intent to make the ERISA civil enforcement
mechanism exclusive would be undermined if state causes of action
that supplement the ERISA §502(a) remedies were permitted, even if
the elements of the state cause of action did not precisely
duplicate the elements of an ERISA claim.
C
Respondents also argue—for the
first time in their brief to this Court—that the THCLA is a law
that regulates insurance, and hence that ERISA §514(b)(2)(A) saves
their causes of action from pre-emption (and thereby from complete
pre-emption).[
Footnote 5] This
argument is unavailing. The existence of a comprehensive remedial
scheme can demonstrate an “overpowering federal policy” that
determines the interpretation of a statutory provision designed to
save state law from being pre-empted.
Rush Prudential, 536
U. S., at 375. ERISA’s civil enforcement provision is one such
example. See
ibid.
As this Court stated in
Pilot
Life, “our understanding of [§514(b)(2)(A)] must be informed
by the legislative intent concerning the civil enforcement
provisions provided by ERISA §502(a), 29 U. S. C. §1132(a).”
481 U. S., at 52. The Court concluded that “[t]he policy choices
reflected in the inclusion of certain remedies and the exclusion of
others under the federal scheme would be completely undermined if
ERISA-plan participants and beneficiaries were free to obtain
remedies under state law that Congress rejected in ERISA.”
Id., at 54. The Court then held, based on
“the common-sense understanding of the saving
clause, the McCarran-Ferguson Act factors defining the business of
insurance, and,
most importantly, the clear expression of
congressional intent that ERISA’s civil enforcement scheme be
exclusive, . . . that [the plaintiff’s] state law suit asserting
improper processing of a claim for benefits under an
ERISA-regulated plan is not saved by §514(b)(2)(A).”
Id.,
at 57 (emphasis added).
Pilot Life’s reasoning
applies here with full force. Allowing respondents to proceed with
their state-law suits would “pose an obstacle to the purposes and
objectives of Congress.”
Id., at 52. As this Court has
recognized in both
Rush Prudential and
Pilot
Life, ERISA §514(b)(2)(A) must be interpreted in light of the
congressional intent to create an exclusive federal remedy in ERISA
§502(a). Under ordinary principles of conflict pre-emption, then,
even a state law that can arguably be characterized as “regulating
insurance” will be pre-empted if it provides a separate vehicle to
assert a claim for benefits outside of, or in addition to, ERISA’s
remedial scheme.
IV
Respondents, their
amici, and some Courts of Appeals have relied heavily upon
Pegram v.
Herdrich, 530 U. S. 211 (2000), in arguing that
ERISA does not pre-empt or completely pre-empt state suits such as
respondents’. They contend that
Pegram makes it clear that
causes of action such as respondents’ do not “relate to [an]
employee benefit plan,” ERISA §514(a), 29 U. S. C. §1144(a),
and hence are not pre-empted. See Brief for Respondents 35–38;
Cicio v.
Does, 321 F. 3d 83, 100–104 (CA2
2003); see also
Land v.
CIGNA Healthcare, 339
F. 3d 1286, 1292–1294 (CA11 2003).
Pegram cannot be read so
broadly. In
Pegram, the plaintiff sued her
physician-owned-and-operated HMO (which provided medical coverage
through plaintiff’s employer pursuant to an ERISA-regulated benefit
plan) and her treating physician, both for medical malpractice and
for a breach of an ERISA fiduciary duty. See 530 U. S., at 215–216.
The plaintiff’s treating physician was also the person charged with
administering plaintiff’s benefits; it was she who decided whether
certain treatments were covered. See
id., at 228. We
reasoned that the physician’s “eligibility decision and the
treatment decision were inextricably mixed.”
Id., at 229.
We concluded that “Congress did not intend [the defendant HMO] or
any other HMO to be treated as a fiduciary to the extent that it
makes mixed eligibility decisions acting through its physicians.”
Id., at 231.
A benefit determination under ERISA, though,
is generally a fiduciary act. See
Bruch, 489 U. S., at
111–113. “At common law, fiduciary duties characteristically attach
to decisions about managing assets and distributing property to
beneficiaries.”
Pegram,
supra, at 231; cf. 2A A.
Scott & W. Fratcher, Law of Trusts §§182, 183 (4th ed. 1987);
G. Bogert & G. Bogert, Law of Trusts & Trustees §541 (rev.
2d ed. 1993). Hence, a benefit determination is part and parcel of
the ordinary fiduciary responsibilities connected to the
administration of a plan. See
Varity Corp. v.
Howe,
516
U. S. 489, 512 (1996) (relevant plan fiduciaries owe a
“fiduciary duty with respect to the interpretation of plan
documents and the payment of claims”). The fact that a benefits
determination is infused with medical judgments does not alter this
result.
Pegram itself recognized this
principle.
Pegram, in highlighting its conclusion that
“mixed eligibility decisions” were not fiduciary in nature,
contrasted the operation of “[t]raditional trustees administer[ing]
a medical trust” and “physicians through whom HMOs act.” 530 U. S.,
at 231–232. A traditional medical trust is administered by “paying
out money to buy medical care, whereas physicians making mixed
eligibility decisions consume the money as well.”
Ibid.
And, significantly, the Court stated that “[p]rivate trustees do
not make treatment judgments.”
Id., at 232. But a trustee
managing a medical trust undoubtedly must make administrative
decisions that require the exercise of medical judgment.
Petitioners are not the employers of respondents’ treating
physicians and are therefore in a somewhat analogous position to
that of a trustee for a traditional medical trust.[
Footnote 6]
ERISA itself and its implementing regulations
confirm this interpretation. ERISA defines a fiduciary as any
person “to the extent … he has any discretionary authority or
discretionary responsibility in the administration of [an employee
benefit] plan.” §3(21)(A)(iii), 29 U. S. C. §1002(21)(A)(iii).
When administering employee benefit plans, HMOs must make
discretionary decisions regarding eligibility for plan benefits,
and, in this regard, must be treated as plan fiduciaries. See
Varity Corp.,
supra, at 511 (plan administrator
“engages in a fiduciary act when making a discretionary
determination about whether a claimant is entitled to benefits
under the terms of the plan documents”). Also, ERISA §503, which
specifies minimum requirements for a plan’s claim procedure,
requires plans to “afford a reasonable opportunity to any
participant whose claim for benefits has been denied for a full and
fair review by the appropriate named fiduciary of the decision
denying the claim.” 29 U. S. C. §1133(2). This strongly
suggests that the ultimate decisionmaker in a plan regarding an
award of benefits must be a fiduciary and must be acting as a
fiduciary when determining a participant’s or beneficiary’s claim.
The relevant regulations also establish extensive requirements to
ensure full and fair review of benefit denials. See 29 CFR
§2560.503–1 (2004). These regulations, on their face, apply equally
to health benefit plans and other plans, and do not draw
distinctions between medical and nonmedical benefits
determinations. Indeed, the regulations strongly imply that
benefits determinations involving medical judgments are, just as
much as any other benefits determinations, actions by plan
fiduciaries. See,
e.g., §2560.503–1(h)(3)(iii).
Classifying any entity with discretionary authority over benefits
determinations as anything but a plan fiduciary would thus conflict
with ERISA’s statutory and regulatory scheme.
Since administrators making benefits
determinations, even determinations based extensively on medical
judgments, are ordinarily acting as plan fiduciaries, it was
essential to
Pegram’s conclusion that the decisions
challenged there were truly “mixed eligibility and treatment
decisions,” 530 U. S., at 229,
i.e., medical necessity
decisions made by the plaintiff’s treating physician
qua
treating physician and
qua benefits administrator. Put
another way, the reasoning of
Pegram “only make[s] sense
where the underlying negligence also plausibly constitutes medical
maltreatment by a party who can be deemed to be a treating
physician or such a physician’s employer.”
Cicio, 321
F. 3d, at 109 (Calabresi, J., dissenting in part). Here,
however, petitioners are neither respondents’ treating physicians
nor the employers of respondents’ treating physicians. Petitioners’
coverage decisions, then, are pure eligibility decisions, and
Pegram is not implicated.
V
We hold that respondents’ causes
of action, brought to remedy only the denial of benefits under
ERISA-regulated benefit plans, fall within the scope of, and are
completely pre-empted by, ERISA §502(a)(1)(B), and thus removable
to federal district court. The judgment of the Court of Appeals is
reversed, and the cases are remanded for further proceedings
consistent with this opinion.[
Footnote 7]
It is so ordered.
Footnote 1
In this Court, petitioners do not claim or
argue that respondents’ causes of action fall under ERISA
§502(a)(2). Because petitioners do not argue this point, and since
we can resolve these cases entirely by reference to ERISA
§502(a)(1)(B), we do not address ERISA §502(a)(2).
Footnote 2
Respondents also argue that the benefit due
under their ERISA-regulated employee benefit plans is simply the
membership in the respective HMOs, not coverage for the particular
medical treatments that are delineated in the plan documents. See
Brief for Respondents 28–30. Respondents did not identify this
possible argument in their brief in opposition to the petitions for
certiorari, and we deem it waived. See this Court’s Rule 15.2.
Footnote 3
To take a clear example, if the terms of the
health care plan specifically exclude from coverage the cost of an
appendectomy, then any injuries caused by the refusal to cover the
appendectomy are properly attributed to the terms of the plan
itself, not the managed care entity that applied those terms.
Footnote 4
Respondents also argue that ERISA §502(a)
completely pre-empts a state cause of action only if the cause of
action would be pre-empted under ERISA §514(a); respondents then
argue that their causes of action do not fall under the terms of
§514(a). But a state cause of action that provides an alternative
remedy to those provided by the ERISA civil enforcement mechanism
conflicts with Congress’ clear intent to make the ERISA mechanism
exclusive. See
Ingersoll-Rand Co. v.
McClendon, 498 U. S. 133, 142 (1990) (holding
that “[e]ven if there were no express pre-emption [under ERISA
§514(a)]” of the cause of action in that case, it “would be
pre-empted because it conflict[ed] directly with an ERISA cause of
action”).
Footnote 5
ERISA §514(b)(2)(A), 29 U. S. C.
§1144(b)(2)(A), reads, as relevant: “[N]othing in this subchapter
shall be construed to exempt or relieve any person from any law of
any State which regulates insurance, banking, or securities.”
Footnote 6
Both
Pilot Life and
Metropolitan
Life support this understanding. The plaintiffs in
Pilot
Life and
Metropolitan Life challenged disability
determinations made by the insurers of their ERISA-regulated
employee benefit plans. See
Pilot Life Ins. Co. v.
Dedeaux, 481 U. S. 41, 43 (1987);
Metropolitan Life Ins. Co. v.
Taylor, 481 U. S. 58, 61 (1987). A disability
determination often involves medical judgments. See,
e.g.,
ibid. (plaintiff determined not to be disabled only after
a medical examination undertaken by one of his employer’s
physicians). Yet, in both
Pilot Life and
Metropolitan
Life, the Court held that the causes of action were
pre-empted. Cf.
Black & Decker Disability Plan v.
Nord, 538 U. S. 822 (2003)
(discussing “treating physician” rule in the context of disability
determinations made by ERISA-regulated disability plans).
Footnote 7
The United States, as
amicus,
suggests that some individuals in respondents’ positions could
possibly receive some form of “make-whole” relief under ERISA
§502(a)(3). Brief for United States as
Amicus Curiae 27,
n. 13. However, after their respective District Courts denied
their motions for remand, respondents had the opportunity to amend
their complaints to bring expressly a claim under ERISA §502(a).
Respondents declined to do so; the District Courts therefore
dismissed their complaints with prejudice. See App. 147–148;
id., at 298; App. B to Pet. for Cert. in No. 02–1845,
pp. 34a–35a; App. B to Pet. for Cert. in No. 03–83,
p. 40a. Respondents have thus chosen not to pursue any ERISA
claim, including any claim arising under ERISA §502(a)(3). The
scope of this provision, then, is not before us, and we do not
address it.
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