Court of Appeals Finds State Law Requiring Plan Reporting to be Preempted by ERISA

The Second Circuit Court of Appeals recently held in Liberty Mutual v. Donegan that a state law involving reporting by benefit plans was preempted. The court explained:

"Liberty Mutual Insurance Co. operates a self-insured employee health plan. A Vermont statute requires all “health insurers” (including self-insured plans) to file with the State reports containing claims data and other “information relating to health care.” A State regulation specifies how such information must be recorded and transmitted...

Two constants, however, remain: (1) recognition that ERISA’s preemption clause is intended to avoid a multiplicity of burdensome state requirements for ERISA plan administration; and (2) acknowledgment that “reporting” is a core ERISA administrative function. These two considerations lead us to conclude that the Vermont law, as applied to compel the reporting of Liberty Mutual plan data, is preempted."

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