ERISA Preempts Tennessee State Anti-Assignment Law

H.S., who participated in an employee health plan governed by ERISA and administered by Community Health Systems, Inc., began receiving hemodialysis treatment in 2012. His chosen healthcare provider, Dialysis Newco, Inc.,was out-of-network for the plan. Initially, the plan covered 100% of the provider’s billed amount but changed course after three months. H.S. executed an “Assignment of Benefits” allowing the provider to sue his plan for the more than $800K in unpaid healthcare costs. The Fifth Circuit Court of Appeals reversed the district court’s ruling that Tennessee law concerning anti-assignment clauses applied. The Fifth Circuit instead found that ERISA’s anti-assignment clause preempted Tennessee state law. Read the full case discussion here.