Blue Cross Blue Shield of Massachusetts prevails in First Circuit on ERISA claims brought by Massachusetts Laborers’ Health & Welfare Fund
Clients Blue Cross Blue Shield of Massachusetts
In an important win for the third-party administrator (TPA) industry, Jones Day persuaded the U.S. Court of Appeals for the First Circuit to affirm the dismissal of ERISA claims brought by the Massachusetts Laborers’ Health & Welfare Fund against Blue Cross Blue Shield of Massachusetts (BCBSMA). The Fund had alleged that BCBSMA was acting as an ERISA fiduciary when serving as a TPA to its multi-employer health plan. The First Circuit disagreed, concluding that BCBSMA was not exercising discretionary authority or control over plan management, much less authority or control over the disposition of plan assets, when repricing claims or engaging in certain settlement and recovery efforts. The court went on to state that to hold otherwise could "interfere" with the "business model" employed by many TPAs. That, in turn, could "come at a steep price to plans and their participants" while creating "unnecessary 'upheaval' in the TPA industry."
Massachusetts Laborers’ Health & Welfare Fund v. Blue Cross Blue Shield of Massachusetts, No. 22-1317 (1st Cir. Apr. 25, 2023)