ERISA preemption and Oklahoma laws on managed care

The Employee Retirement Income and Security Act of 1974 ("ERISA") affects Oklahoma managed care laws and thus the practice of medicine in complex and important ways. Because ERISA was enacted before managed care became an industry, ERISA's provisions have had unanticipated effects and become controversial. Insurers and managed care organizations have been quite successful in taking advantage of ERISA's preemption provisions to avoid being controlled by state laws, including those that regulate insurance. Congress is presently seeking to change this to varying degrees in the different versions of the "Patient Protection" bills. ERISA preempts state laws that "relate to" the administration of an ERISA covered plan. Numerous courts and legal scholars have sought to define what this language means with respect to state managed care laws. ERISA preemption affects patients' rights to sue utilization reviewers and insurers (as opposed to healthcare providers) for negligent determinations of "medical necessity" that interfere with treatment. Moreover, it interferes with Oklahoma's laws governing the quality of benefits, including those concerning external review of insurance benefit determinations. This article provides practitioners with a roadmap to one of the most important debates in healthcare today to facilitate informed participation in the political process on these issues.