We all know that health insurance is very important and in fact many would not receive treatment but for having health insurance in place. Sometimes the medication or treatment may have been provided for years, only for subsequent treatment claims to be denied.  Denials can be vague such as “more information needed" or “no medical necessity” despite providing coverage previously. Confusion is the friend of insurers.

 That especially occurs when a new vendor is hired by the health insurance company to make decisions on prescription or diagnostic or treatment claims. They deny or delay claims improperly to justify their existence (i.e. savings to the health insurer).  The health provider may not pick up on this soon enough and furnish the information.  To make matters worse, the person assigned to submitting claims for a health provider may not follow up on unpaid claims for weeks or even months, since there never was a problem before.

 So what happens if someone dies as a result of a wrongful refusal to cover a claim? Sadly, the death itself may not provide any recovery and only the unpaid benefits may be sought. This results in one of the travesties of ERISA.  The 1^st Circuit Court of Appeals weighed in on this situation recently, closing the door for a recovery for the loss of life.

 In this case a dependent under a health insurance plan had asthma, a well-known lifelong illness regularly treated with medication.  A claim for asthma medication was denied, and before the matter could be resolved, the dependent died from an asthma attack.  Suit was filed in state court alleging wrongful death of the dependent. The case was removed from state court, however, on federal question grounds since it was argued that ERISA governed the claim.

 The district court was tasked with answering the question of whether the wrongful death and punitive damages claim related to the plan (insurance contract). If review of the plan was required in order to ascertain the wrongful conduct, then the state law claims would be preempted by ERISA. In this case, the district court concluded that all state law claims were preempted by ERISA as the court would have to review the plan document to determine if the conduct was wrongful.

 The court further evaluated if it is possible that some state law claims could continue as ERISA claims. The claims asserted were only for compensatory damages and punitive damages.  They did not allege claims for “the amount of the benefits not paid.” The district court reasoned that ERISA does not permit a recovery of punitive damages or compensatory damages other than the amount of the benefits due. Accordingly, the case was dismissed.

 An appeal followed. In Cannon v. Blue Cross & Blue Shield Mass., Inc., No. 24-1862, 2025 U.S. App. LEXIS 6424 (1st Cir. Mar. 19, 2025), the 1st Circuit affirmed the lower court's decision. The Court noted Cannon's primary contention was “that Rutledge v. Pharm. Care Mgmt. Ass'n, 592 U.S. 80 (2020), overrules prior law and requires reinstatement of the wrongful death/punitive damages suit … .” (Rutledge evaluated if an Arkansas statute which required pharmacy benefit managers to reimburse Arkansas pharmacies at a price equal to or higher than that which the pharmacy paid to buy a prescription drug from a wholesaler.  The state law was not preempted.)  The 1^st Circuit rejected that argument and affirmed the decision despite the loss of life here.

The court first held that a state law cause of action is preempted if it "relates" to any employee benefit plan under 29 U.S.C. § 1144(a). In this case, it was necessary to read and interpret the plan document to ascertain if the conduct was wrong. Thus, the state law claims related to an ERISA plan and were barred.  This was labeled as statutory preemption.

 Additionally, the 1st Circuit found that there can be conflict preemption if the state law claims conflict with the remedial scheme under 29 U.S.C. § 1132(a).  That provision allows that a "civil action may be brought [] by a participant or beneficiary . . . to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan."  The court further opined that if the dependent had survived, the dependent of course would only have a claim for wrongful denial of benefits.  The plaintiff stood in the shoes of the participant and could not have a greater claim than the dependent.  There could only be a claim for benefits.

 Life is too precious to be so flimsily guarded.  However, absent an amendment to the ERISA statute, this is what we have. So, what can we do? If a claim is denied, both the insured and the medical provider need to do all necessary to immediately challenge that decision. Demand the entire claim record and all professional opinions relied on to deny the claim. Demand the plan document as well. Demand a complete explanation of what documents are necessary for the claim to be paid.  If the provider can't help, get legal counsel right away. Then challenge that in a timely manner.

 I have seen claim records where the professional opinion of a board certified hematologist was disregarded by an insurer in favor of its prescription vendor's allergist on a matter involving hematology. Most courts will not let that stand. You must get the claim record and carefully review that and then challenge the claim.

 Further, both the provider and the insured should look for options to make the medication affordable.  Sometimes charitable organizations may help temporarily or even a pharmaceutical company interested in good public relations might help in the short term. Far better to live to fight the claim denial!