United States Sixth Circuit Court of Appeals; Docket No. 86-1614/1615/1616;
Judges Merritt, Martin and Brown; Unpublished
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
In this long awaited Opinion from the United States Sixth Circuit Court of Appeals, the Court, in a unanimous written opinion by Judge Merritt, held that the Michigan Supreme Court's rule in Federal Kemper v Health Insurance Administration (Item No. 868) applied to insured and self-insured ERISA health insurance plans. Therefore, if a no-fault policy contains a coordination of benefits provision pursuant to §3109a of the no-fault statute and an ERISA health plan also contains a coordination of benefits provision purporting to make it secondary to no-fault insurance, the health insurance policy will be deemed primary and the coordinated no-fault policy secondary. In its opinion, the Court of Appeals interpreted the Employment Retirement Income Security Act of 1974 (ERISA), 29 USC 1001, et seq, and the sections of that statute which preempt conflicting state laws. The Court concluded that the Michigan no-fault law regarding coordination of benefits is not preempted by the ERISA statute. In so holding, the Court held that other federal legislation had recognized that there is a strong state interest in the regulation of insurance. With regard to this specific issue, the Court noted, "there is no demonstrated interest in national uniformity and preemption of state law would substantially disrupt a state regulatory scheme generally applicable to both insured and self-insured ERISA plans, as well as to insurers generally." The Court went on to note that if it did not apply the Federal Kemper rule, it would be inviting the development of a complex body of federal common law regarding the interplay between ERISA health plans and the Michigan no-fault law. It declined to do so. Therefore, as a result of this opinion, any and all health insurance plans which have coordination clauses that conflict with no-fault coordination clauses are primary.