Skip to main content

Joanne Roskey Comments on Impact of ERISA on State's Efforts to Regulate Healthcare in Stateline

Subtitle
"States Want to Lower Drug Prices. A Federal Law Stands in Their Way"

Stateline

Joanne Roskey, a former Deputy Associate Solicitor in the Department of Labor's (DOL) Plan Benefits Security Division (PBSD), commented on Oklahoma's stringent law regulating pharmacy benefit managers (PBMs), targeting drug pricing and reimbursements and pharmacy networks. The law was among the most comprehensive in the U.S., prohibiting PBMs from imposing certain fees and offering better terms to their own pharmacies. However, its application to application to self-funded health plans was largely blocked due to the federal Employee Retirement Income Security Act (ERISA), which sets uniform standards for employer-sponsored health and retirement plans, limiting states' ability to impose regulations on these plans. 

The U.S. Circuit Court of Appeals for the Tenth Circuit ruled that ERISA prevented the full enforcement of Oklahoma's PBM law on self-funded plans. Roskey noted ERISA can be triggered fairly easily, which complicates states' efforts to regulate their healthcare markets. As a result, many states regulations don't apply to the nearly two-thirds of health plan participants enrolled in self-funded plans. Oklahoma has appealed this decision to the U.S. Supreme Court, with support from 32 state attorneys general and various pharmacist groups.