RESPONDENT: Jodie Nevils
LOCATION: Supreme Court of Missouri
DOCKET NO.: 16-149
LOWER COURT: Supreme Court of Missouri
CITATION: US ()
GRANTED: Nov 04, 2016
Facts of the case
Jodie Nevils was a federal employee with a Coventry Health Care of Missouri (Coventry) health insurance plan that was governed by the Federal Employee Health Benefits Act (FEHBA), which expressly preempts state laws and regulations governing health insurance and benefits plans. After Nevils was awarded a settlement in a personal injury case, Coventry enforced a claim to the settlement money. Nevils sued Coventry and argued that Missouri law prevented insurance companies from claiming the proceeds of personal injury settlements. The trial court entered summary judgment in favor of the insurance company and held that the FEHBA preempted state law regarding insurance companies’ claims to the proceeds of personal injury settlement. The Supreme Court of Missouri reversed and held that the FEHBA did not preempt state law in this case because an insurance company’s claim to a personal injury settlement does not clearly relate to “the nature, provision, or extent of coverage or benefits.”
After the Supreme Court of Missouri’s decision, the Office of Personnel Management created a new formal rule. That rule stated that an insurance carrier’s rights and responsibilities with respect to the settlement of an individual covered by that insurance carrier’s plan “relate to the nature, provision, and extent of coverage or benefits” for the purpose of the FEHBA. The U.S. Supreme Court subsequently granted certiorari for this case and vacated and remanded the lower court’s decision for reconsideration in light of this new rule. On remand, the Supreme Court of Missouri held that there is no precedent that establishes that a federal agency’s interpretation of a preemption clause receives judicial deference. Therefore, the Supreme Court of Missouri again determined that the FEHBA did not preempt Missouri state law.
- Does the Federal Employee Health Benefits Act (FEHBA) preempt state laws that prohibit insurance companies from claiming the proceeds of personal injury settlements pursuant to their contracts?
- Does the express preemption clause of the Federal Employee Health Benefits Act (FEHBA) violate the Supremacy Clause of the U.S. Constitution?