ESTATE OF BIBI AHMAD V. UNITEDHEALTH GROUP INCORPORATED, ET AL.

Holding: The Ninth Circuit held that state law claims alleging deceptive marketing of Medicare Advantage plans are expressly preempted by the Medicare Act.
Standard: Medicare Act express preemption
Vote: Unpublished memorandum decision by a panel of three judges.
Practical effect: The ruling reinforces that state consumer protection claims regarding Medicare Advantage marketing are barred by federal preemption, even when brought against third-party marketing organizations.

The Ninth Circuit affirmed the dismissal of a putative class action alleging deceptive marketing of Medicare Advantage plans. The court held that state law claims regarding marketing materials were expressly preempted by the Medicare Act.

Background

The Estate of Bibi Ahmad appealed the dismissal with prejudice of a putative class action against UnitedHealth Group and United Healthcare. The Estate alleged that the defendants deceptively marketed Medicare Advantage plans under state law.

The court’s reasoning

The court reviewed the dismissal de novo and affirmed based on the Medicare Act’s express preemption provision for Part C Medicare Advantage. The court found that federal statutes and regulations extensively prescribe duties for Medicare Advantage plans, including marketing and communications. Because these federal standards exist, they supersede any state law duty on the same subject, regardless of whether the state claim is inconsistent or merely parallel. The court rejected the argument that preemption did not apply because the defendants were marketing affiliates rather than the plan organization, noting that affiliates must comply with all applicable Medicare laws and the plan organization remains responsible for their compliance.

We review de novo the district court’s dismissal of the complaint, as well as its determination that a federal statute preempts state law claims.

Uhm v. Humana, Inc., 620 F.3d 1134, 1139–40 (9th Cir. 2010)

What it means going forward

The ruling reinforces that state consumer protection claims regarding Medicare Advantage marketing are barred by federal preemption, even when brought against third-party marketing organizations.