Shea v. Esensten

Shea
v. Esensten,
2000 WL 336674 (8th Cir.(Minn) March 31, 2000)

Plaintiff, whose husband
died of heart failure after being persuaded by his physicians that he was not
in need of a cardiology referral, appealed a decision of the District Court
which dismissed her fraud and misrepresentation claim against her husband’s
physicians as being preempted by ERISA. The 8th Circuit Court of Appeals held
that state law claim, based on the physicians’ failure to disclose a financial
conflict of interest contained in financial incentive for reduced referral provisions
in the physicians’ HMO contracts, was not preempted by ERISA. The court determined
that allowing the state law claim to proceed would not negate any “ERISA
plan provision” or “impact the structure, administration, or economics
of any ERISA plan,” as would be required for ERISA preemption. Additionally,
the court indicated that ERISA does not preempt the entire field of health care,
and that the claim in question, stemming from the “ethical responsibilities
imposed on physicians,” falls within the traditional power of the states
to regulate health and safety.