SELF-INSURANCE INSTITUTE OF AMERICA, INC., Plaintiff-Appellant, v. Rick SNYDER, in his official capacity as Governor of the State of Michigan; R. Kevin Clinton, in his official capacity as Director of the Office of Financial and Insurance Regulation of the State of Michigan; Andrew Dillon, in this official capacity as Treasurer of the State of Michigan, Defendants-Appellees.
No. 12-2264.
United States Court of Appeals, Sixth Circuit.
Argued: Jan. 31, 2014. Decided and Filed: Aug. 4, 2014.
761 F.3d 631
Before: BOGGS and MOORE, Circuit Judges; BARRETT, District Judge.*
OPINION
KAREN NELSON MOORE, Circuit Judge.
This case requires us, once again, to navigate the quagmire that is preemption. Plaintiff-Appellant, Self-Insurance Institute of America, Inc. (“SIIA“), represents various sponsors and administrators of self-funded ERISA benefit plans, which it claims are affected by Michigan‘s Health Insurance Claims Assessment Act. SIIA argues that federal law—the Supremacy Clause,
I. BACKGROUND
In 2011, Michigan passed the Health Insurance Claims Assessment Act (“the Act“), 2011 Mich. Pub. Acts 142, codified at
In district court, SIIA filed suit against Rick Snyder, the Governor of Michigan; R. Kevin Clinton, the Director of the Michigan Office of Financial and Insurance Regulation (“OFIR“); and Andrew Dillon, Treasurer of Michigan. R. 1 at 1 (Compl.) (Page ID # 1). SIIA sought a declaratory judgment, which would state that ERISA preempted the Act, and an injunction, which would prevent implementation and enforcement of the Act against the ERISA-covered entities. Id. The defendants filed a motion to dismiss under
II. STANDARD OF REVIEW
We review de novo a district court‘s dismissal of a claim pursuant to
III. ANALYSIS
“Congress enacted ERISA to ‘protect ... the interests of participants in employee benefit plans and their beneficiaries’ by setting out substantive regulatory requirements for employee benefit plans and to ‘provid[e] for appropriate remedies, sanctions, and ready access to the Federal courts.‘” Aetna Health Inc. v. Davila, 542 U.S. 200, 208 (2004) (quoting
The Supreme Court has called ERISA‘s express-preemption provision “broadly worded” and “deliberately expansive.” California Div. of Labor Standards Enforcement v. Dillingham Constr., N.A., 519 U.S. 316, 324 (1997) (internal quotation marks omitted). The Court, however, has found providing useful guidance in this area to be difficult and defining “relates to” to be a “frustrating” task. N.Y. State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 656 (1995). We readily concur. The statutory text is simply “unhelpful” because “[i]f ‘relate to’ were taken to extend to the furthest stretch of its indeterminacy, then for all practical purposes pre-emption would never run its course, for ‘[r]eally, universally, relations stop nowhere.‘” Id. at 655-56 (quoting Henry James, Roderick Hudson xli (New York ed., World‘s Classics 1980)); see also Dillingham, 519 U.S. at 335 (Scalia, J., concurring) (“[A]pplying the ‘relate to’ provision according to its terms was a project doomed to failure, since, as many a curbstone philosopher has observed, everything is related to everything else.“). The best guidance that the Court has been able to give us is to say that “[a] law ‘relates to’ an employee benefit plan, in the normal sense of the phrase, if it has a connection with or reference to such a plan.” Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97 (1983).
SIIA contends that ERISA preempts the Act because the Act has an impermissible connection with employee benefit plans, namely that it (1) interferes with the
A. “Connection With”
We begin with SIIA‘s allegations that the Act has an impermissible connection with ERISA plans. The district court rejected this argument in its entirety, finding that the Act was a law of “‘general applicability,‘” R. 41 at 18 (D. Ct. Am. Order) (Page ID # 489) (quoting De Buono v. NYSA-ILA Med. & Clinical Servs. Fund, 520 U.S. 806, 820 (1997)), that “does not mandate any particular benefit structure or bind administrators to certain benefits choices,” id. at 16 (Page ID # 487). On appeal, SIIA makes several, slightly different arguments as to different sections of the statute, and we address each in turn.
1. Legal Standard
In determining whether a state law has an impermissible connection with ERISA plans, we start with the presumption that Congress did not intend to preempt state laws, particularly in areas of traditional state concern. Travelers, 514 U.S. at 654; Associated Builders & Contractors v. Michigan Dep‘t of Labor & Economic Growth, 543 F.3d 275, 280 (6th Cir.2008) (citing Dillingham, 519 U.S. at 332). In this case, we are concerned with a state tax and its ancillary requirements, a type of law long recognized as an important “attribute of state sovereignty.” Firestone Tire & Rubber Co. v. Neusser, 810 F.2d 550, 555 (6th Cir.1987) (citing County of Lane v. Oregon, 74 U.S. (7 Wall.) 71, 76-77 (1869)); see also Thiokol Corp. v. Roberts, 76 F.3d 751, 755 (6th Cir.1996) (citing Fair Assessment in Real Estate Ass‘n, Inc. v. McNary, 454 U.S. 100, 103 (1981)). Therefore, the presumption applies with special force in this case, and overcoming it “requires two showings ...: (1) the law at issue must mandate (or effectively mandate) something, and (2) that mandate must fall within the area that Congress intended ERISA to control exclusively.” Associated Builders, 543 F.3d at 281.
All agree that “[t]he purpose of ERISA preemption was to avoid conflicting federal and state regulation and to create a nationally uniform administration of employee benefit plans.” PONI, 399 F.3d at 698. In line with this congressional intent, we have held that “ERISA preempts state laws that (1) mandate employee benefit structures or their administration; (2) provide alternate enforcement mechanisms; or (3) bind employers or plan administrators to particular choices or preclude uniform administrative practice, thereby functioning as a regulation of an ERISA plan itself.” Id. (internal quotation marks omitted). “Congress did not intend, however, for ERISA ‘to preempt traditional state-based laws of general applicability that do not implicate the relations among the traditional ERISA plan entities, including the principals, the employer, the plan, the plan fiduciaries, and the beneficiaries.‘” Id. (quoting LeBlanc v. Cahill, 153 F.3d 134, 147 (4th Cir.1998)). In short, ERISA does not “create a state-law-free zone around everything that affects an ERISA plan....” Associated Builders, 543 F.3d at 284. Therefore, SIIA must show that the Act (1) “mandates an aspect of law with which ERISA is concerned,” such as the administration of the plan itself, id. at 280, or (2) interferes with the relationship between ERISA-covered entities, PONI, 399 F.3d at 698.
2. The Act Does Not Interfere with Plan Administration
SIIA first claims that the Act interferes with uniform plan administration. This argument takes two forms. One, SIIA focuses upon the Act‘s definition of “paid claims” and argues that the state law‘s definition of a claim may conflict with a plan‘s definition of a claim. Appellant Br. at 35-36; see also
To start, SIIA fails to grasp that ERISA guarantees uniformity only with regard to the “administration of employee benefit plans.” PONI, 399 F.3d at 698 (emphasis added). Neither the Act‘s definition of “paid claims” nor its reporting and record-keeping requirements conflict with the administrator‘s “standard procedures to guide processing of claims and disbursement of benefits.”1 Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 9 (1987); see also Aetna Life Ins. Co. v. Borges, 869 F.2d 142, 146-47 (2d Cir.1989) (“What triggers ERISA preemption is not just any indirect effect on administrative procedures but rather an effect on the primary administrative functions of benefit plans, such as determining an employee‘s eligibility for a benefit and the amount of that benefit.“). The state‘s definition of “paid claims” applies, and the state‘s reporting and record-keeping requirements come into play, only when the carriers compute the tax—a function entirely divorced from plan administration. The Act‘s provisions simply do not conflict with the plan or impact its administration. See Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 739 (1985) (noting that ERISA “displace[s] all state laws that fall within its sphere” (emphasis added)). The Act‘s only potential effects are to cut the plans’ profits—as did the surcharges upheld in Travelers and De Buono—and to create work independent of the core functions of ERISA—as do permissible state property and employment laws. See Thiokol, 76 F.3d at 755 (“[T]he Supreme Court does not require that state laws have absolutely zero effect on ERISA plans, for this likely would be impossible as a matter of logic or
At oral argument and in its briefing, SIIA relied heavily upon Egelhoff v. Egelhoff, 532 U.S. 141 (2001), in support of its view. But that case ultimately cuts against SIIA. In Egelhoff, the Supreme Court did state that “[o]ne of the principal goals of ERISA is to enable employers to establish a uniform administrative scheme,” but, importantly, it defined that scheme as the “set of standard procedures to guide processing of claims and disbursement of benefits.” Id. at 148 (internal quotation marks omitted) (emphasis added). The state law at issue in Egelhoff directed ERISA plans to disburse benefits according to state law, rather than the plan documents. Id. at 147. The Court struck down this statute because it “directly conflict[ed] with ERISA‘s requirements that plans be administered, and benefits be paid, in accordance with plan documents.” Id. at 150 (emphasis added). If the Act involved here altered which benefits were offered, how they were calculated, or to whom they were dispersed, under Egelhoff, it would be preempted. It does none of these things; it has no impact upon plan administration, as the Court has defined that concept. Thus, Egelhoff does not compel us to hold the Act preempted for interfering with plan administration.
3. The Act Does Not Create Inappropriate Administrative Burdens
Next, SIIA argues that ERISA preempts §§ 550.1734 and 550.1735 of the Act, which require carriers and third-party administrators to file reports and to keep certain records, because they allegedly add to ERISA‘s administrative requirements. There is no doubt that Congress intended for plan administrators to file various reports and to maintain the records that serve as the basis for those reports. See
Here, principles of field preemption guide our inquiry into congressional intent. See Dillingham, 519 U.S. at 336 (Scalia, J., concurring). Under this doctrine, Congress’ intent to supersede state law altogether may be inferred because “[t]he scheme of federal regulation may be so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it,” because “the Act of Congress may touch a field in which the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject,” or because “the object sought to be obtained by federal law and the character of obligations imposed by it may reveal the same purpose.” Fidelity Fed. Sav. & Loan Ass‘n v. de la Cuesta, 458 U.S. 141, 153 (1982) (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947)) (alteration in original).
In this case, it is clear that Congress intended ERISA to preempt state laws providing for additional oversight with regard to the solvency of ERISA
This basic conclusion, however, does not mean that Congress intended federal law to bar states from imposing additional administrative burdens unrelated to the plans’ core functions. In fact, several cases indicate to us that the opposite is true. First, in Travelers, the Supreme Court upheld a New York law that required ERISA-covered hospitals to collect surcharges from certain patients. 514 U.S. at 649. That law also required the hospitals to “furnish to the [state tax] department such reports and information as may be required by the commissioner to assess the cost, quality and health system needs for medical education provided.”
Finally, under SIIA‘s logic, states would not be able to require ERISA-covered entities to submit any paperwork or preserve any records in any circumstances. As a result, ERISA would preempt any state laws requiring ERISA-covered entities to submit income-tax returns, property-tax returns, or employment records. We have said, time and again, that ERISA does not reach so far. See, e.g., Thiokol, 76 F.3d at 755; Firestone, 810 F.2d at 555-56; see also De Buono, 520 U.S. at 816 (“Any state tax, or other law, that increases the cost of providing benefits to covered employees will have some effect on the administration of ERISA plans, but that simply cannot mean that every state law with such an effect is preempted by the federal statute.“). We see no reason to change course now.
SIIA‘s arguments to the contrary are unpersuasive. To start, it points us toward NGS American, Inc. v. Barnes, 998 F.2d 296 (5th Cir.1993), in which the Fifth
SIIA also cites Liberty Mutual Insurance Co. v. Donegan, 746 F.3d 497 (2d Cir.2014). In Liberty Mutual, a divided panel of the Second Circuit held that ERISA preempted a Vermont statute that requires “all health insurers (including self-insured plans) to file with the State reports containing claims data and other information relating to health care.” Id. at 499 (referencing
In addition, Liberty Mutual can be distinguished on two other grounds. One, here the Act‘s reporting requirements are intimately related to a state tax—a traditional area of state concern that we presume Congress left untouched. In contrast, the Vermont statute mandates reporting to build a health-care database, a purpose not entitled to the presumption. Two, according to the Second Circuit, the Vermont statute effectively gave the ERISA plan a choice: (1) allow its third-party administrator to turn over the data in violation of its plan document, which protected beneficiaries’ privacy; or (2) direct the third-party administrator not to comply with the law and then indemnify it according to their contract. Id. at 502; see also id. at 502 n. 4 (relying upon floor statements of individual members of Congress). Under our conception of the ERISA preemption provision, state laws cannot put this choice to the ERISA-covered entities. The Vermont scheme actually affects the administration of the plans; it does not just create additional administrative work unrelated to the processing of the claims, as the Act involved here does. For these reasons, we do not find Liberty Mutual persuasive or helpful. As a result, we are not persuaded by SIIA‘s counterarguments, and we hold that
4. The Act‘s Residency Requirement Does Not Interfere with the Relationships Between ERISA-Covered Entities
SIIA‘s next claim is that the Act‘s limitation of the tax to claims paid on behalf of Michigan residents effectively alters the relationship between plan administrators and plan beneficiaries because the requirement forces the administrators to collect additional information from beneficiaries. We disagree.
Under Michigan law, an individual is a Michigan resident if the individual considers the state her domicile.
A rebuttable presumption shall exist that an individual‘s home address, as maintained in the ordinary business records of a carrier or third-party administrator, indicates the domicile of that individual under this definition. Example: An individual who is domiciled in Michigan, but attends college in another state, is a Michigan resident for purposes of the Act. If that individual obtains health services in Michigan while home between semesters, a “paid claim” for the performance of those services will be subject to the assessment under the Act.
By defining residency by reference to the administrators’ already-existing business records, Michigan leaves the relationship between ERISA-covered entities untouched. As a result, we do not believe Congress intended ERISA to preempt the Act‘s residency requirement.2
5. Section 550.1733a Does Not Interfere with the Relationships Between ERISA-Covered Entities
SIIA finally argues that
B. “Refers To”
The Iron Workers Fund and the Trowel Trades Fund ask us to hold that the Act makes an inappropriate reference to ERISA-regulated employee benefit plans, triggering the operation of
In its opening brief, SIIA forthrightly states that “[it] does not appeal the District Court‘s conclusion that the Act does not have a ‘reference to’ ERISA plans.” Appellant Br. at 28. By conceding this issue, SIIA has waived it, and this waiver generally precludes us from considering the issue. See, e.g., Demyanovich v. Cadon Plating & Coatings, LLC, 747 F.3d 419, 434 n. 6 (6th Cir.2014); Bickel v. Korean Air Lines Co., 96 F.3d 151, 153 (6th Cir.1996). Furthermore, we have stated that “[w]hile an amicus may offer assistance in resolving issues properly before a court, it may not raise additional issues or arguments not raised by the parties. To the extent that the amicus raises issues or makes arguments that exceed those properly raised by the parties, we may not consider such issues.” Cellnet Commc‘ns, Inc. v. FCC, 149 F.3d 429, 443 (6th Cir.1998); see also New Jersey v. New York, 523 U.S. 767, 781 n. 3 (1998) (stating that courts “must pass over” arguments of amici that the named party to the case “has in effect renounced“); 16AA Charles Alan Wright et al., Federal Practice & Procedure § 3975.1 (4th ed.2008) (“In ordinary circumstances, an amicus will not be permitted to raise issues not argued by the parties.“). Otherwise, outside parties could hijack litigation quite easily. Therefore, to avoid this result, we hold that SIIA has waived this issue and, therefore, decline to consider its validity.
IV. CONCLUSION
For the above-stated reasons, we AFFIRM the district court‘s dismissal of SIIA‘s claims.