High Court Decision Supports States' Any Willing Provider Laws
In a unanimous opinion issued April 2, 2003, Kentucky Ass'n of Health Plans, Inc. v. Miller, the U.S. Supreme Court has held that two state "any willing provider" (AWP) statutes are not federally preempted and may be enforced against HMOs that offer qualified ERISA employee benefit plans in Kentucky. HMOs argued to the Court that the statutes, which require HMOs to include in their provider networks any health care provider willing to meet the HMO's participation terms and conditions, are not "laws which regulate insurance" that are saved from preemption under ERISA because the laws also regulate doctors and their relationships with HMOs. Rejecting this argument, the Court established the two requirements a state law must satisfy to survive ERISA preemption: it must be "specifically directed toward entities engaged in insurance," and "must substantially affect the risk pooling arrangement between the insurer and the insured." The Court held that the Kentucky AWP statutes satisfy these requirements, even though they also affect noninsurers. The Court reaffirmed other recent decisions upholding state laws as applied to ERISA plans, including a 2002 case in which the Court upheld a Pennsylvania law requiring HMOs to provide independent review of "medically necessary" service determinations. Managed care industry
executives are claiming that the decision will result in higher health
insurance premiums and diminished quality of care.
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