Minnesota Law Review

Note, Embracing Equity: A New Remedy for Wrongful Health Insurance Denials

Through benefit decisions, health insurance companies have the power to refuse treatment to insured persons. Individuals harmed by denials that are unjustified or violate the insurance contract may have no recourse. The federal Employee Retirment Income Secuirty Act (ERISA) governs all health insurance plans provided through employers. With ERISA, Congress in tended to protect workers from the risk of default or misadministration of their retirement plans. However, the Court has narrowly construed ERISA to exclude most, if not all, consequential damages for those harmed by wrongful healthcare denials. Moreover, patients cannot sue under common law or state law causes of action because the Court has ruled that ERISA preempts such claims. As a result, a “regulatory vacuum” exists in which victims of such denials have little opportunity for relief. Most commentors assume that this vacuum will remain until the Court overturns its precedents or Congress amends ERISA.

However, patients may not need to look to Congress for a solution. The Supreme Court will allow relief under ERISA if both the basis for the claim and the category of remedy were historically available in equity. Due to these requirements, the Court will likely reject most proposed remedies that provide compensation under ERISA, such as retitution, reinstatement, and make-whole relief for breach of fiduciary duty.

Plaintiffs may find acceptable ERISA remedies, though, by embracing the Court’s command to examine the practice of historical courts of equity. Surcharge is a remedy granted in equity for breaches of fiduciary duty. it requires the fiduciary to compensate the victim for costs incurred, income lost, and gains foregone because of the breach. This remedy fulfills the Court’s requirements for “equitable relief” under ERISA and meets the objections the Court has raised to other forms of compensatory relief. Most importantly, it may offer a last chance at compensation for victims of wrongful health insurance denials.

:: View PDF

News & Events

  • Welcome

    For nearly one hundred years, the Minnesota Law Review has been a leader amongst academic legal publications. When Professor Henry J. Fletcher launched the journal in 1917, his goal was simple. It was to “contribute a little something to the systematic growth of the whole law.” Since then, the Law [...]

  • Minnesota Law Review Alum Remembered 45 Years After Death

    Minnesota Law Review alumnus Tom Cranna was honored at the Annual Banquet this Spring, 45 years after his death. Mr. Cranna was remembered for his contributions to the journal, the school, and the positive impact he had on his family and friends. The Devil’s Lake Journal published a memorial which [...]

  • Follow MLR on Twitter!

    The Minnesota Law Review is proud to announce that we are now on Twitter. Follow us @MinnesotaLawRev for information and updates concerning the petition period and deadlines, the opening and closing of article submissions, our 2014 Symposium: Offenders in the Community, and all other news concerning our authors and publications. [...]

  • Vol. 97 Lead Piece Cited in Al Jazeera Opinion Piece

    A recent Al Jazeera opinion piece that criticizes the Supreme Court’s Daimler decision cites to Volume 97′s lead piece, How Business Fares in the Supreme Court. You can read the Al Jazeera piece here. Share this: on Twitter on Facebook on Google+

  • Masthead for Volume 99 Board

    The masthead for the Board of Volume 99 of the Minnesota Law Review is now available. You can view the masthead here. Share this: on Twitter on Facebook on Google+


cforms contact form by delicious:days