On June 5, 2014, the Washington State Attorney General, Office of the Insurance Commissioner, and Human Rights Commission (the “Agencies”) jointly issued an announcement clarifying that under Washington State law (which recognizes same-sex marriages and prohibits discrimination on the basis of sexual orientation), all group health plans providing coverage to opposite-sex spouses must extend that coverage to same-sex spouses as well.1 The Agencies contemporaneously issued a set of FAQs with additional information, including a general description of the applicable State laws (and possible limitations, such as different application of the State’s anti-discrimination laws on employers with fewer than eight employees).
Perhaps the most noteworthy aspect of the Agencies’ FAQs is the position that self-insured ERISA plans covering Washington employees are also subject to Washington’s anti-discrimination law, and so must extend any spousal coverage to same-sex spouses. The Agencies assert that after the U.S. Supreme Court’s 2013 decision in U.S. v. Windsor (which requires recognition of same-sex spouses under federal law), ERISA’s preemption provisions cannot be used to trump state laws requiring same-sex spouses to be offered the same coverage as opposite-sex spouses. While insurers and fully-insured group health plans have long been subject to state insurance laws, self-insured ERISA plans generally are not subject to state laws, as a result of ERISA’s broad preemption provisions, and the Agencies have not provided an analysis or explanation for their position that Windsor alters ERISA preemption.
As the Agencies’ position does not appear to be consistent with the traditional ERISA preemption analysis, it likely won’t be long until the courts weigh in on this issue. In the meantime, self-insured ERISA plans covering Washington employees should be aware that they may risk a discrimination claim or Agency enforcement efforts if spousal coverage is limited to opposite-sex spouses.
The announcement is available at:
http://www.atg.wa.gov/uploadedFiles/Insurance%20Equality%20Letter%20FINAL.pdf.
A news release is available at:
http://www.atg.wa.gov/pressrelease.aspx?&id=32167#.U6SekXJdX9Y.
The Agencies’ FAQs are available at:
http://www.atg.wa.gov/uploadedFiles/FAQ%20Insurance%20Equality%20FINAL.pdf.
Not intended as legal advice.
- The Agencies’ clarification was the result of its investigation of O’Reilly Auto Parts’ self-insured ERISA benefit plan, which was prompted by a complaint from a spouse of an O’Reilly employee alleging violations of these Washington laws. According to the Agencies, their investigation resulted in O’Reilly amending its plans to extend coverage to same-sex spouses.