The recent rise in state law regulation of pharmacy benefit managers (PBMs) and prescription drug pricing continues to test the limits of preemption under the Employee Retirement Income Security Act of 1974, as amended (ERISA).
While certain recent legislation includes provisions that are purported or explicitly drafted to apply to self-funded employer-sponsored health plans subject to ERISA, these laws have faced ongoing challenges on the basis that ERISA generally preempts state laws that impermissibly relate to self-funded ERISA health plans, as further discussed in our prior blog post.
On April 7, the United States Court of Appeals for the Sixth Circuit delivered a win for self-funded ERISA plan sponsors by upholding an earlier district court ruling that portions of Tennessee’s PBM laws are preempted by ERISA and cannot be applied to self-funded ERISA plans.
