Benefits and Compensation

Court Allows ERISA Plan to Deny Coverage to Same-Gender Spouse

A self-insured employer that explicitly excludes same-gender spouses from health plan coverage did not violate ERISA’s benefit interference or fiduciary breach provisions by having such exclusionary language, a federal district court in New York ruled. A same-gender couple had argued that, in light of U.S. v. Windsor, because the plan declined to cover the spouse, the employer interfered with the attainment of benefits. However, the court noted, that only narrower ERISA claims were the focus of the lawsuit — not other federal laws or constitutional issues. As such, as ERISA currently stands, employers have the right to design their plans as they see fit — as long as someone’s employment is not adversely affected. In the case, Roe v. Empire Blue Cross Blue Shield, 12 CV 04788 NSR (S.D.N.Y., May 1, 2014)),


The plaintiff Jane Roe worked for St. Vincent’s Hospital, a division of St. Joseph’s Medical Center, since 2007. After New York legalized same-gender marriage in 2011, she and her partner, Jane Doe, were married. After their marriage, Roe attempted to add Doe as a dependent to her self-insured health plan with St. Joseph’s; however, the human resources department informed Roe that the plan did not cover same-gender spouses. When Roe sent a grievance letter requesting that the denial be reversed, administrators responded, saying that same-gender spouses and domestic partners are excluded from participation.

Case Background

At the same time that plaintiffs filed a class action complaint against St. Joseph’s and the plan’s third-party administrator, the 2nd U.S. Circuit Court of Appeals was deciding Windsor v. United States. The Roe plaintiffs sought preliminary injunction in light of the Windsor case, but court reserved making a decision. By the time the case was reassigned in July 13, 2013, the decision in U. S. v. Windsor had come down from the U.S. Supreme Court. As such, eliminated Section 3 of the federal Defense of Marriage Act, which said marriage can only be between a man and a woman, was deemed unconstitutional.

The Roe case then moved forward, with the defendants seeking a dismissal and the plaintiffs seeking the preliminary injunction. The Roe plaintiffs argued that, in light of Windsor, ERISA must now follow the New York Marriage Equality Act, which expressly states that:

No government treatment or legal status, effect, right, benefit, privilege, protection or responsibility relating to marriage, whether deriving from statute, administrative or court rule, public policy, common law or any other source of law, shall differ based in the parties to the marriage being or having been of the same sex rather than a different sex. When necessary to implement the rights and responsibilities of spouses under the law, all gender-specific language or terms shall be construed in a gender-neutral manner in all such sources of the law.

However, the defendants argued that ERISA preempts the New York law. Generally, ERISA preempts state laws that “relate to” an employee benefit plan. However, the court noted that courts must presume that ERISA is not intended to preempt areas of traditional state regulation — like issues of marriage and divorce. In doing so, it cited case law noting that New York law governs whether parties are legally married, which determines the identity of the spouse under ERISA and a plan.

However, the court then noted that the ERISA preemption issue was irrelevant because the main question in the case is whether a private plan may exclude same-gender couples as beneficiaries under ERISA.

The plaintiffs charged that the defendants violated Section 510 of ERISA, which covers “Interference with protected rights.” Under Section 510, it is unlawful to “discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising and right to which he is entitled under the provisions of an employer benefit plan.” The 2nd Circuit and other courts have found that Section 510 relates to “interference with the employment relationship” and the employee’s rights to benefits.

The court added that under ERISA, employers and plan sponsors are free to create, change, or even terminate a welfare plan. Furthermore, ERISA does not require that employers provide any particular benefits.

The court cited case law finding that that ERISA “has long been held to be a regulator of plans, not a dictator of plan terms.” It also noted that the 2nd Circuit has found that Section 510 does not, and should not, preclude plan design as the employer or sponsor sees fit. This would include the option of providing — or not providing — benefits to spouses, so long as it does not does not adversely affect employment. Here, the court noted that Roe remained employed and suffered no adverse employment action.