Plaintiffs-Appellees CIGNA Healthplan of Louisiana (CIGNA) and Connecticut General Life Insurance Company (CGLIC) filed suit against Defendant-Appellant the State of Louisiana, ex rel. Richard P. Ieyoub, Attorney General1 (Ieyoub), seeking inter alia (1) a declaratory judgment holding that Louisiana's Any Willing Provider statute2 is preempted by the Employee Retirement Income Security Act (ERISA)3; and (2) an injunction prohibiting the commencement of any action against them for alleged violations of the Any Willing Provider statute.4 The district court granted summary judgment declaring that ERISA preempts the Any Willing Provider statute insofar as it applies to third party administrators and health care plans that provide services to ERISA-qualified benefit plans, and issued an injunction barring enforcement of the statute against CIGNA and CGLIC. Concluding that the Any Willing Provider statute relates to employee benefit plans within the meaning of ERISA's preemption clause,5 and that the statute is not exempted from preemption by ERISA's insurance savings clause,6 we affirm.

In 1984, in an attempt to reduce health care costs without jeopardizing the quality of care received by patients,7 the Louisiana legislature enacted the Health Care Cost Control Act (the Act).8 The Act specifically authorizes the formation of preferred provider organizations (PPOs), which are defined as "contractual ... agreements between a provider or providers and a group purchaser or purchasers to provide for alternative rates of payment...."9 The definitional section of the Act contains a definition of "group purchaser," then follows the definition with an illustrative list of some of the types of entities that may be included in that category.10 According to the Act, "group purchasers" may include "[e]ntities which contract for the benefit of their insured, employees, or members"11; and "[e]ntities which serve as brokers for the formation of [contracts with providers], including health care financiers, third party administrators, ... or other intermediaries."12

The Any Willing Provider statute, which is incorporated as § 2202(5)(c) of the Act, mandates that "[n]o licensed provider ... who agrees to the terms and conditions of the preferred provider contract shall be denied the right to become a preferred provider."13 According to an advisory opinion issued by the Louisiana Attorney General's office in February 1993, the arbitrary exclusion from a PPO of a licensed physician who is "willing and able to accede to the terms and conditions of the preferred provider contract" constitutes both a violation of the Any Willing Provider statute and an unfair trade practice under Louisiana law.14

Both CIGNA and CGLIC constitute "group purchasers" under the terms of the Act. CIGNA is a licensed health maintenance organization (HMO) that provides prepaid health care coverage to enrolled subscribers--including the sponsors of ERISA-qualified employee benefit plans--by contracting with selected physicians, hospitals, and other health care suppliers (collectively, providers). The chosen providers agree to comply with CIGNA's quality control requirements and to offer health care services to CIGNA's subscribers at a discounted rate.

In Louisiana, CIGNA's provider network is marketed by CGLIC, a licensed health insurer. CGLIC also contracts with CIGNA for the right to use the provider network in conjunction with the insured and self-funded health benefit plans that CGLIC offers to, and administers for, its clients. Like CIGNA's subscribers, CGLIC's clients include the sponsors of ERISA-qualified employee welfare benefit plans.

3. Impact of the Any Willing Provider Statute

In 1994, CIGNA notified one of the physicians on its provider network, Dr. Ronald Sylvest, that his contract was being terminated. Dr. Sylvest sued CIGNA, alleging that his termination violated the Any Willing Provider statute. After a temporary restraining order was issued against CIGNA, the parties reached a settlement; and the suit was dismissed.

Since the dismissal of the Sylvest suit, CIGNA has received statutory notice from the Attorney General's office that a formal complaint has been filed by a doctor charging that CIGNA violated the Any Willing Provider statute by rejecting his application to its provider panel. Moreover, CIGNA has received, and would like to reject, applications from a number of physicians seeking inclusion in its network of providers.

In an effort to free themselves from the threat of suit for the violation of the Any Willing Provider statute, CIGNA and CGLIC brought this action against Ieyoub in federal district court, seeking inter alia (1) a declaratory judgment holding that the Any Willing Provider statute is preempted by ERISA; and (2) an injunction prohibiting the commencement of any action against them for alleged violations of the Any Willing Provider statute. The district court granted summary judgment declaring that ERISA preempts the Any Willing Provider Statute insofar as it relates to third party administrators and health care plans that provide services to ERISA-qualified benefit plans, and issued an injunction barring Ieyoub from enforcing the statute against CIGNA and CGLIC. Ieyoub timely appealed.

When reviewing a grant of summary judgment, we view the facts and inferences in the light most favorable to the non-moving party15; and we apply the same standards as those governing the trial court in its determination.16 Summary judgment must be granted if a court determines "that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."17

The first question we must address is whether the Any Willing Provider statute is preempted pursuant to § 514(a) of ERISA. Section 514(a) states that ERISA "shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan" that is covered by the federal statute.19 Courts have interpreted this preemption clause broadly, observing that its deliberatively expansive language was designed "to establish ... plan regulation as exclusively a federal concern."20

The Supreme Court has given the phrase "relate to" a "broad common-sense meaning."21 A state law relates to an ERISA plan "in the normal sense of the phrase if it has connection with or reference to such a plan."22 A state law can relate to an ERISA plan even if that law was not specifically designed to affect such plans, and even if its effect is only indirect.23 If a state law does not expressly concern employee benefit plans, it will still be preempted insofar as it applies to benefit plans in particular cases.24 Of particular significance to our analysis today is the fact that the Supreme Court has repeatedly held that ERISA preempts "state laws that mandat[e] employee benefit structures or their administration."25

Nevertheless, ERISA preemption is not without limits. The Supreme Court has cautioned that "[s]ome state actions may affect employee benefit plans in too tenuous, remote, or peripheral a manner to warrant a finding that the law 'relates to' the plan."26 A unanimous Supreme Court has recently held in this regard that ERISA does not preempt state laws that have "only an indirect economic effect on the relative costs of various health insurance packages" available to ERISA-qualified plans.27

ERISA itself contains provisions which limit the scope of preemption.28 For the purposes of the instant appeal, it is relevant that under § 514(b)(2)(A) of ERISA, preemption stops short of "any law of any State which regulates insurance."29

2. Application of § 514(a) to the Instant Appeal

As discussed above, § 514(a) of ERISA provides for the preemption of state laws that either refer to or have a connection with an ERISA-qualified plan.30 The Any Willing Provider statute qualifies for preemption on both counts. First, it refers to ERISA-qualified plans. More specifically, the statute requires that all licensed providers "who agre[e] to the terms and conditions of the preferred provider contract" must be accepted as providers in the PPO.31 Under the terms of the Act, a preferred provider contract constitutes an agreement "between a provider or providers and a group purchaser or purchasers to provide for alternative rates of payment specified in advance for a defined period of time."32 The Act specifically provides that group purchasers may include entities, such as "Taft-Hartley trusts or employers who establish or participate in self funded trusts or programs,"33 which "contract [with health care providers] for the benefit of their ... employees."34 Given that these enumerated entities constitute ERISA-qualified plans,35 the Act, and through it the Any Willing Provider statute,36 expressly refers to ERISA plans.

Moreover, the statute "relates to" ERISA plans in the sense that it is connected with such plans. The Supreme Court has emphasized that preemption is appropriate on this ground when statutes "mandat[e] employee benefit structures or their administration."37 In the instant case, ERISA plans that choose to offer coverage by PPOs are limited by the statute to using PPOs of a certain structure--i.e., a structure that includes every willing, licensed provider. Stated another way, the statute prohibits those ERISA plans which elect to use PPOs from selecting a PPO that does not include any willing, licensed provider. As such, the statute connects with ERISA plans.

Neither is it of any consequence that plans might not choose to offer coverage by PPOs: It is sufficient for preemption purposes that the statute eliminates the choice of one method of structuring benefits.38 The fact that neither CIGNA nor CGLIC is itself an ERISA plan is likewise inconsequential: By denying insurers, employers, and HMOs the right to structure their benefits in a particular manner, the statute is effectively requiring ERISA plans to purchase benefits of a particular structure when they contract with organizations like CIGNA and CGLIC.39 In that regard, the statute "bears indirectly but substantially on all insured plans,"40 and is accordingly preempted by ERISA.41

Ieyoub and amici curiae42 strenuously argue that this conclusion is barred by the Supreme Court's recent decision in New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co.,43 which was decided shortly after the district court issued its opinion in the instant case. In Travelers, the Court held that ERISA does not preempt a New York statute that requires hospitals to collect surcharges from patients covered by commercial insurers, but not from patients insured by Blue Cross & Blue Shield plans. The plaintiffs in Travelers argued that the New York statute was preempted by ERISA because it "make[s] the Blues more attractive (or less unattractive) as insurance alternatives and thus ha[s] an indirect economic effect on choices made by insurance buyers, including ERISA plans."44 The Supreme Court disagreed, holding that statutes that have "only an indirect economic effect on the relative costs of various health insurance packages"45 available to ERISA plans are not preempted by ERISA. The Court reasoned that "[a]n indirect economic influence ... does not bind plan administrators to any particular choice."46 The Court also emphasized the limited nature of its holding:

[W]e do not hold today that ERISA preempts only direct regulation of ERISA plans, nor could we do that with fidelity to the views expressed in our prior opinions on the matter. We acknowledge that a state law might produce such acute, albeit indirect, economic effects, by intent or otherwise, as to force an ERISA plan to adopt a certain scheme of substantive coverage ... and that such a state law might indeed be preempted under § 514. But as we have shown, New York's surcharges do not fall into [that] category; they affect only indirectly the prices of insurance policies, a result no different from myriad state laws in areas traditionally subject to local regulation....47

Unlike the New York statute at issue in Travelers, Louisiana's Any Willing Provider statute specifically mandates that certain benefits available to ERISA plans must be constructed in a particular manner. In other words, the Louisiana statute does not merely raise the cost of the implicated benefits; it delineates their very structure. As such, the statute falls outside the purview of the limited Travelers holding: The Court there repeatedly recognized that ERISA preempts "state laws that mandat[e] employee benefit structures."48 Accordingly, we hold that the Travelers decision leaves undisturbed our conclusion that Louisiana's Any Willing Provider statute is preempted by ERISA.

Determining that the Louisiana statute "relates to" ERISA plans and is therefore covered by ERISA's broad preemption provision does not complete our inquiry. We must next consider whether the statute is nonetheless saved from preemption by one of the exceptions embodied in ERISA's savings clause. This clause provides that "nothing in this title shall be construed to exempt or relieve any person from any law of any State which regulates insurance, banking, or securities."49 In Metropolitan Life Insurance Co. v. Massachusetts,50 the Supreme Court delineated the requirements that a statute must meet to come within the insurance facet of the savings clause. As we have noted in prior opinions, the Court took a conjunctive two-step approach:

First, the court determined whether the statute in question fitted the common sense definition of insurance regulation. Second, it looked at three factors: (1) Whether the practice (the statute) has the effect of spreading the policyholders' risk; (2) whether the practice is an integral part of the policy relationship between the insurer and the insured; and (3) whether the practice is limited to entities within the insurance industry. If the statute fitted the common sense definition of insurance regulation and the court answered "yes" to each of the questions in the three part test, then the statute fell within the savings clause exempting it from ERISA preemption.51

Thus, if a statute fails either to fit the common sense definition of insurance regulation or to satisfy any one element of the three-factor Metropolitan Life test, then the statute is not exempt from preemption by the ERISA insurance savings clause.52

When we begin to apply that test to Louisiana's Any Willing Provider Statute, we may start and finish with the third factor of the Metropolitan Life test: On its face, Louisiana's statute obviously is not "limited to entities within the insurance industry." Even though the statute lists insurers as one group covered by its terms, it also specifies, in a non-exclusive list, that it applies to "self-funded organizations, Taft-Hartley trusts, or employers who establish or participate in self funded trusts or programs,"53 as well as "health care financiers, third party administrators, providers, or other intermediaries."54 As the statute fails to meet the third factor of the Metropolitan Life test,55 we affirm the district court's holding that the statute is not saved from preemption by the insurance exception of § 514(b) of ERISA.

For the foregoing reasons, we affirm the district court's grant of summary judgment declaring that ERISA preempts the Any Willing Provider Statute insofar as it relates to third party administrators and health care plans that provide services to ERISA-qualified benefit plans. We also affirm the court's grant of an injunction barring Ieyoub from enforcing the statute against CIGNA and CGLIC.

AFFIRMED.