As the legal landscape surrounding insurance claims continues to evolve, plaintiffs may increasingly pivot towards state laws to pursue their cases, particularly in disputes involving arbitration awards. Michael Gottlieb of Gottlieb & Greenspan, representing numerous medical provider plaintiffs, highlighted this trend by noting that his firm frequently invokes state law causes of action. He asserts that insurers’ refusal to comply with binding arbitration awards under the federal No Surprises Act (NSA) contravenes fundamental state tort principles, such as unjust enrichment. This approach underscores a growing reliance on state-level legal frameworks to address grievances against insurers. Read more.
The shift towards state legislation can be attributed to the complexities and uncertainties inherent in federal law, which can lead to prolonged legal battles. State courts often provide a more predictable and expedient route for plaintiffs seeking resolution. Additionally, state laws might offer remedies not available under federal statutes, thereby expanding the legal toolkit available to plaintiffs. According to Larry Levitt at Kaiser Family Foundation, states have historically played a pivotal role in regulating insurance, which makes them natural venues for these disputes.
This trend is not entirely new. Litigators have long turned to state laws when federal regulations fall short or are silent on particular issues. The enforcement of the NSA, which aims to protect patients from surprise medical billing and mandates binding arbitration for disputes, is a current focal point in this dynamic legal arena. However, insurers’ alleged non-compliance with arbitration outcomes has fueled new litigation strategies anchored in state laws. The strategic choice to leverage state law will likely influence how similar disputes are addressed nationwide.
For corporate legal teams and their clients, this shift underscores the importance of a keen understanding of state-specific legal principles. As more plaintiffs bring state law-based claims, companies must adapt to the increasing complexity of the regulatory environment. Legal departments in major corporations should prepare for a broader spectrum of legal challenges, where state law intricacies could play a decisive role in the outcomes of such cases.