State Laws Cannot Require More From Self Funded Plans Than ERISA. . .
Recently, in the state of Washington, a law was passed that prohibits workplace discrimination based upon sexual orientation. When an employee protested the denial of health care coverage to her partner by her employer’s self funded ERISA plan, she brought the matter to court. The court in turn determined that the law could not be enforced against private employers with self funded plans, as it conflicted with ERISA.
Likewise, in Maryland, the Fourth Circuit Court of Appeals held that the Maryland Fair Share Healthcare Fund Act was preempted by ERISA. The law made it mandatory for employers in Maryland with 10,000 or more employees to provide minimum benefits or pay a fee to the state. The benefits were considerably greater than those required by ERISA. The court noted that the law was meant to target Wal-Mart, as it was the only employer with 10,000 or more employees in the state. As in the Washington case, the law hindered the employer’s ability to apply a uniform plan nationally, and as such, was contrary to ERISA and preempted by federal law.