Docket No. S271501
Quishenberry v. UnitedHealthcare, Inc.
IN THE SUPREME COURT OF
CALIFORNIA
LARRY QUISHENBERRY,
Plaintiff and Appellant,
v.
UNITEDHEALTHCARE, INC., et al.,
Defendants and Respondents.
S271501
Second Appellate District, Division Seven
B303451
Los Angeles County Superior Court
BC631077
July 13, 2023
Justice Groban authored the opinion of the Court, in which
Chief Justice Guerrero and Justices Corrigan, Liu, Kruger,
Jenkins, and Evans concurred.
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
S271501
Opinion of the Court by Groban, J.
This case concerns a Medicare Advantage (MA) enrollee
who died after being discharged from a skilled nursing facility.
The enrollee’s son, Larry Quishenberry, sued the MA health
maintenance organization (HMO) plan and a healthcare
services administrator that managed his father’s MA benefits.
Quishenberry pled state-law claims for negligence, wrongful
death, and elder abuse based on allegations that the HMO and
healthcare services administrator breached a duty to ensure his
father received skilled nursing benefits to which he was entitled
under his MA plan.
The HMO and healthcare services administrator assert
that Quishenberry’s claims are expressly preempted by
Medicare Part C’s preemption provision, which provides that the
“standards established under” Part C “shall supersede any State
law or regulation” concerning MA plans. (42 U.S.C. § 1395w-
26(b)(3).) Because Quishenberry’s state-law claims are based on
allegations that his father’s HMO plan and healthcare services
administrator breached state-law duties that incorporate and
duplicate standards established under Part C, we agree and
hold that the provision preempts them.
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Opinion of the Court by Groban, J.
I. Background
A. Medicare Part C
The Medicare Act, part of the Social Security Act, provides
for a federally subsidized health insurance program
administered by the Centers for Medicaid and Medicare
Services (CMS), a division of the Department of Health and
Human Services. (McCall v. PacifiCare of Cal., Inc. (2001
25 Cal.4th 412, 416 (McCall).) “Under Parts A and B of the Act,
Medicare beneficiaries requiring medical services obtain those
services directly from providers participating in the Medicare
program, and [Medicare] directly reimburses those providers on
a ‘fee-for-service’ basis.” (Roberts v. United Healthcare Services,
Inc. (2016) 2 Cal.App.5th 132, 140 (Roberts); 42 U.S.C.
§§ 1395c–1395i-5 [Part A] & 1395j–1395w-6 [Part B].) “Part A
covers ‘hospital, skilled nursing, home health, and hospice care
benefits,’ while Part B covers ‘physician and other outpatient
services.’ ” (Roberts, at p. 140.
Part C — under which Quishenberry’s father was
insured — permits Medicare beneficiaries to “sign up for a
privately administered health care plan” — an MA plan — “that
provides all of the Part A and B benefits as well as additional
benefits.” (Roberts, supra, 2 Cal.App.5th at p. 140.) “If a
beneficiary elects to participate in [an MA] plan, the government
pays the plan’s administrator a flat, monthly fee to provide all
Medicare benefits for that beneficiary. Because Part C limits
the government’s responsibility to just the monthly fee, the
private health plan — rather than the government — ends up
‘assum[ing] the risk associated with insuring’ the beneficiary.”
(Ibid.
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Opinion of the Court by Groban, J.
MA plans are governed by standards set out in Part C and
in detailed federal regulations. As described below, these
standards comprehensively address MA plans’ coverage of
skilled nursing care. (See post, section III.C.
B. Factual and Procedural History
This case comes to us on review of a trial court order
sustaining demurrers of the HMO plan and healthcare services
administrator to Quishenberry’s second amended complaint.
We take the relevant facts from that complaint. (Yvanova v.
New Century Mortgage Corp. (2016) 62 Cal.4th 919, 924.
According to the complaint, a hospital transferred
Quishenberry’s 85-year-old father to a skilled nursing facility for
physical therapy after treating him for a broken hip. Due to the
neglect of the nursing facility and his physician there,
Quishenberry’s father developed severe pressure sores, which
the facility and physician did not properly treat.1 After about
24 days at the skilled nursing facility, Quishenberry’s father
was discharged to his home, where he received inadequate care,
experienced pain and suffering, and eventually died.
Quishenberry alleges his father was enrolled in an MA
HMO plan offered by UnitedHealthcare, Inc., UnitedHealth
Group Incorporated, UnitedHealthcare Services, Inc., and UHC
of
California
(collectively,
UnitedHealthcare).
UnitedHealthcare contracted with Healthcare Partners Medical
Group (Healthcare Partners) to administer the MA plan with
1
Quishenberry also sued the skilled nursing facility and his
father’s physician. He settled with the skilled nursing facility, and
the physician’s defenses are not at issue in this appeal.
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Opinion of the Court by Groban, J.
respect to physician services, delegating to Healthcare Partners
its duty under the plan to provide such services.
According to the complaint, Quishenberry’s father was
entitled under Medicare to 100 days of medically necessary care
at a skilled nursing facility — 76 additional days beyond the 24
days he received. However, his father’s skilled nursing facility
and treating physician, acting pursuant to standard business
practices of UnitedHealthcare and Healthcare Partners, falsely
informed his father that he was not entitled to further inpatient
care and prematurely discharged him to his home.
Quishenberry further alleges that UnitedHealthcare had
“responsibility for the custodial care and treatment” of his father
by contract with CMS. “By contract and federal law,”
UnitedHealthcare and Healthcare Partners were able to control
the skilled nursing facility, and they knew the facility was not
providing Medicare-covered, medically necessary skilled
nursing care to its resident-patients. Nevertheless, they
“acquiesced to, encouraged, directed, aided and abetted” the
facility and physician in discharging Quishenberry’s father
“under circumstances where acceptable medical practice and
Medicare rules required” that his father remain at the facility
“for more intense attention to his health care needs.”
Quishenberry alleges they did so “to increase profit by reducing
the cost of providing” skilled nursing facility care.
Based on these allegations, Quishenberry pled — as
relevant here — a state statutory claim under the Elder Abuse
Act and common law claims of negligence and wrongful death.2
2
Quishenberry also pled a bad faith claim, but he does not
dispute the dismissal of that claim, so it is not at issue.
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Opinion of the Court by Groban, J.
UnitedHealthcare and Healthcare Partners — the only
defendants involved in this appeal — demurred to the second
amended complaint, arguing that Quishenberry’s claims were
preempted by Medicare Part C’s preemption provision. The trial
court sustained the demurrers without leave to amend and
entered judgment in their favor.
Quishenberry appealed, and the Court of Appeal affirmed,
concluding that the Part C preemption provision preempted
Quishenberry’s claims. The Court of Appeal relied on Roberts,
supra, 2 Cal.App.5th 132, which disagreed with earlier Court of
Appeal decisions that concluded the provision does not expressly
preempt either common law claims — such as Quishenberry’s
negligence and wrongful death claims — or statutory claims
that are based on generally applicable law, such as
Quishenberry’s claim under the Elder Abuse Act. (See Yarick v.
PacifiCare of California (2009) 179 Cal.App.4th 1158, 1165–
1166 (Yarick) [observing that language like that of the Part C
preemption provision “usually is interpreted to preempt only
‘positive state enactments,’ that is, laws and administrative
regulations, but not the common law”]; Cotton v. StarCare
Medical Group, Inc. (2010) 183 Cal.App.4th 437, 450–452
(Cotton) [holding Part C preemption provision reaches only state
statutes and regulations relating to MA plans].) We granted
review to address whether the Part C preemption provision
reaches Quishenberry’s claims.
II. Discussion
The question before us is whether the state-law duties
Quishenberry seeks to enforce via his statutory claim of elder
abuse and common law claims of negligence and wrongful death
are superseded by “standards established under” Medicare Part
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Opinion of the Court by Groban, J.
C, and thus expressly preempted by the Part C preemption
provision. (42 U.S.C. § 1395w-26(b)(3).) Because deciding this
question requires us to interpret the preemption provision and
apply it to the claims Quishenberry alleges in his complaint, our
review is de novo. (Farm Raised Salmon Cases (2008
42 Cal.4th 1077, 1089, fn. 10; see also McCall, supra, 25 Cal.4th
at p. 415.
A. Preemption Principles
The United States Supreme Court has explained the basic
operation of federal preemption as follows: “Congress enacts a
law that imposes restrictions or confers rights on private actors;
a state law confers rights or imposes restrictions that conflict
with the federal law; and therefore the federal law takes
precedence and the state law is preempted.” (Murphy v. NCAA
(2018) 138 S.Ct. 1461, 1480.) Preemption can be “express” or
“implied.” The term express preemption refers to Congress’s use
of “express language in a statute” to supersede state law.
(Oneok, Inc. v. Learjet, Inc. (2015) 575 U.S. 373, 376.) Whether
Congress has expressly preempted a state-law claim is
primarily a question of statutory construction. (Medtronic, Inc.
v. Lohr (1996) 518 U.S. 470, 484 (Medtronic).
When addressing such questions, we look first to the
language of the preemption provision in its statutory context,
“ ‘which necessarily contains the best evidence of Congress’ pre-
emptive intent.’ ” (Sprietsma v. Mercury Marine (2002) 537 U.S.
51, 62–63 (Sprietsma).) If we determine Congress intended a
provision “to pre-empt at least some state law,” our task
becomes to identify “ ‘the domain expressly pre-empted.’ ”
(Medtronic, supra, 518 U.S. at p. 484; see also Quesada v. Herb
Thyme Farms, Inc. (2015) 62 Cal.4th 298, 308 (Quesada).
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Opinion of the Court by Groban, J.
Congress’s objectives in enacting the statute may serve as a
“guide” for discerning “the scope of the state law that Congress
understood would survive” preemption and for determining
whether a particular state-law duty is within that scope.
(Rutledge v. Pharm. Care Mgmt. Ass’n (2020) 141 S.Ct. 474, 480
[___ U.S. ___, ___].)3
B. The Scope of the Medicare Part C Preemption
Provision
In accordance with the principles outlined above, we begin
our analysis with the plain language of Medicare Part C’s
preemption provision. (Quesada, supra, 62 Cal.4th at p. 308.
The provision reads in full: “The standards established under
this part shall supersede any State law or regulation (other than
State licensing laws or State laws relating to plan solvency) with
respect to MA plans which are offered by MA organizations
under this part.” (42 U.S.C. § 1395w-26(b)(3).) Although the
term “standards” is not defined in the Medicare Act, we
understand the phrase “[t]he standards established under this
part” to refer to the provisions of Part C and federal regulations
promulgated pursuant to Part C. (42 U.S.C. § 1395w-26(b)(3);
see 42 C.F.R. § 422.402; Do Sung Uhm v. Humana, Inc. (9th Cir.
2010) 620 F.3d 1134, 1148, fn. 20 (Uhm).) We read the words
“shall supersede” as commanding that these federal statutory
3
Quishenberry urges us to apply a presumption against
preemption. We decline to do so. (See Puerto Rico v. Franklin Cal.
Tax-Free Trust (2016) 579 U.S. 115, 125 [“[B]ecause the statute
‘contains an express preemption clause,’ we do not invoke any
presumption against preemption but instead ‘focus on the plain
wording of the clause, which necessarily contains the best evidence
of Congress’ pre-emptive intent’ ”].
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Opinion of the Court by Groban, J.
provisions and regulations be given preemptive effect. (Cf.
Betancourt v. Storke Housing Investors (2003) 31 Cal.4th 1157,
1163 [“shall supersede” language in the Employee Retirement
Income Security Act of 1974 (ERISA) creates preemption]; Rush
Prudential HMO, Inc. v. Moran (2002) 536 U.S. 355, 364
[same].) We accordingly interpret the phrase “[t]he standards
established under this part shall supersede” as reflecting
Congress’s intent that the provisions of Part C and federal
regulations established under Part C preempt at least some
state-law duties. (42 U.S.C. § 1395w-26(b)(3).) This much the
parties do not dispute.
The balance of the preemption provision identifies what is
preempted by the standards established under Part C — “any
State law or regulation . . . with respect to MA plans which are
offered by MA organizations under this part” — and also what
Congress has exempted from preemption — “State licensing
laws or State laws relating to plan solvency.” (42 U.S.C. §
1395w-26(b)(3).) Quishenberry does not contend that his claims
implicate licensing laws or solvency-related laws. Our task
therefore is to determine whether the standards established
under Part C preempt the state-law duty on which
Quishenberry’s claims concerning his father’s MA plan is based.
(Ibid.
We start by considering Quishenberry’s arguments
concerning the domain preempted. (See Medtronic, supra,
518 U.S. at p. 484.) He contends this domain does not
encompass state-law duties that duplicate federal duties,
common-law claims such as his negligence and wrongful death
claims, or claims based on generally applicable state statutory
law such as his claim under the Elder Abuse Act. We discuss
each of these arguments in turn.
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1. The Provision Expressly Preempts Duplicative
State-Law Duties
Quishenberry argues that there is no express preemption
of a state-law duty that is “based on federal standards”
established under Part C. For a claim rooted in duties
established under federal law to be actionable under state law,
there must be a state-law duty to comply with federal law; state
law must incorporate federal law such that the federal duties
are enforceable via a state-law claim. (See Riegel v. Medtronic,
Inc. (2008) 552 U.S. 312, 324 (Riegel) [“[C]ommon-law liability is
‘premised on the existence of a legal duty,’ and a tort judgment
therefore establishes that the defendant has violated a state-law
obligation”].) Quishenberry would have us read the Part C
preemption provision as not extending to state-law duties that,
in this way, are based on and duplicate federal standards
established under Part C.
The provision’s plain language does not support
Quishenberry’s proposed reading. By using the expansive word
“any” to describe the domain of state standards preempted,
Congress indicated its intent that standards established under
Part C preempt “any” state-law duty “with respect to MA plans,”
even when the duty is based on and duplicative of a federal
standard. (42 U.S.C. § 1395w-26(b)(3).) The intent to preempt
duplicative state-law duties is apparent when we contrast the
Part C preemption provision’s language — superseding “any
State law or regulation . . . with respect to MA plans” (ibid.) —
with the language of the Federal Food, Drug, and Cosmetic Act’s
preemption provision related to medical devices. That provision
specifies that state-law duties that are “different from, or in
addition to” federal requirements are preempted. (21 U.S.C. §
360k(a)(1).) In Medtronic, the United States Supreme Court
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Opinion of the Court by Groban, J.
held this provision’s preemptive domain did not extend to “state
rules that merely duplicate some or all of [the] federal
requirements.” (Medtronic, supra, 518 U.S. at p. 495.) By
contrast, the phrase “any state law or regulation” in the Part C
preemption provision suggests that Congress did not intend to
narrowly preempt only those state-law standards that are
inconsistent with the federal standards. (42 U.S.C. § 1395w-
26(b)(3).) Instead, it intended the standards established under
Part C to supersede “any” state standards “with respect to MA
plans,” including those that are based on and duplicative of
standards established under Part C. (Ibid.
The legislative history of the Part C preemption provision
confirms this reading. When first enacted in 1997, Medicare
Part C included a differently worded express preemption clause
(see Pub.L. No. 105-33, § 1856(b)(3) (Aug. 5, 1997) 111 Stat.
251). The 1997 version of the clause specified that federal
standards superseded a state law or regulation “to the extent
such law or regulation is inconsistent with such standards.”
(Ibid.) Congress enacted the current version of the provision in
a section of the Medicare Prescription Drug Improvement and
Modernization Act of 2003 titled “Avoiding duplicative State
regulation.” (Pub.L. No. 108-173 (Dec. 8, 2003) 117 Stat. 2066,
§ 232.) The 2003 amendment removed the requirement that a
state law be “inconsistent with” federal standards. (Ibid.) By
removing that requirement, Congress made clear its intent not
to limit preemption to state-law claims that are inconsistent
with federal standards. (Medicaid & Medicare Advantage
Prods. Ass’n of P.R., Inc. v. Hernandez (1st Cir. 2023) 58 F.4th
5, 12 (Hernandez); Uhm, supra, 620 F.3d at pp. 1149–1150.
The current version of the provision thus extends preemption to
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Opinion of the Court by Groban, J.
state-law standards that are based on and duplicative of
standards established under Part C.
2. The Provision’s Scope Extends to Common-Law
Claims
Quishenberry next contends that the Part C preemption
provision does not preempt common-law claims and instead
preempts only claims brought under state statutes and
regulations. The provision’s plain language contradicts
Quishenberry’s interpretation. The phrase “any State law or
regulation” is most naturally read to encompass common law.
(42 U.S.C. § 1395w-26(b)(3), italics added.) The narrow nature
of the provision’s savings clause confirms that Congress
intended standards established under Part C to supersede state-
law duties regardless of whether they are rooted in statutory or
common law. The savings clause designates two specific areas
of state law to be preserved from preemption — “State licensing
laws” and “State laws relating to plan solvency” — and no
others. (42 U.S.C. § 1395w-26(b)(3).) Preemption provisions in
other federal statutes, by contrast, contain exemptions for much
broader categories of state-law duties. For example, the Federal
Boat Safety Act of 1971 (FBSA) contains a savings clause that
preserves “liability at common law or under State law.”
(46 U.S.C. § 4311(h); see Sprietsma, supra, 537 U.S. at p. 63.
Similarly, the savings clause of the Occupational Safety and
Health Act of 1970 preserves, among other rights, any “common
law or statutory rights, duties, or liabilities of employers and
employees under any law with respect to injuries, diseases, or
death of employees arising out of, or in the course of,
employment.” (29 U.S.C. § 653(b)(4).) The fact that Congress
chose to identify only two categories of state statutory law as
preserved from preemption — and chose not to specify that
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Opinion of the Court by Groban, J.
common law duties are exempt — suggests it did not intend to
categorically exempt common law duties.4
The preemption provision’s legislative history also
suggests that Congress did not intend to preserve common law
duties from preemption. Prior to the 2003 amendment, Health
and Human Services had interpreted the original preemption
provision as foreclosing common law claims that are, in effect,
claims that certain services are covered under an MA plan.
(65 Fed.Reg. 40170, 40261 (June 29, 2000); see Uhm, supra,
620 F.3d at p. 1155.) We presume that Congress was aware of
the Secretary’s interpretation when it amended the preemption
clause in 2003. (Uhm, at p. 1155.) Because Congress did not act
to correct Health and Human Services’ understanding when
making this amendment, it appears “that Congress intended the
Part C preemption provision . . . to preempt at least some
common law claims.” (Ibid.
CMS’s position on the meaning of the amended version of
the Part C preemption provision also accords with our
understanding. When issuing a proposed rule implementing the
2003 amendment, CMS stated that: “[G]enerally applicable
4
This conclusion is consistent with the great weight of federal
and sister state authority on the preemptive effect of the Part C
preemption provision and the identical preemption provision in
Part D of the Medicare Act (42 U.S.C. § 1395w-112(g)). (See, e.g.,
Hernandez, supra, 58 F.4th at pp. 11–13; Aylward v. SelectHealth,
Inc. (9th Cir. 2022) 35 F.4th 673, 681 (Aylward); Pharm. Care
Mgmt. Ass’n v. Wehbi (8th Cir. 2021) 18 F.4th 956, 971–972; Uhm,
supra, 620 F.3d at pp. 1153–1156; Haaland v. Presbyterian Health
Plan, Inc. (D.N.M. 2018) 292 F.Supp.3d 1222, 1230–
1231; Morrison v. Health Plan of Nev. Inc. (Nev. 2014) 328 P.3d
1165, 1171–1172; Snyder v. Prompt Med. Transp., Inc.
(Ind.Ct.App. 2019) 131 N.E.3d 640, 652–653.
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State tort, contract, or consumer protection law would not be
preempted” because the preemption provision “was intended to
preempt state standards governing health plans, not generally
applicable State laws” or “contract laws and tort laws.”
(69 Fed.Reg. 46866, 46913 (Aug. 3, 2004).) However, CMS
clarified this position when it promulgated the final rule,
concluding that “all State standards, including those established
through case law, are preempted to the extent they specifically
would regulate MA plans, with exceptions of State licensing and
solvency laws. Other State health and safety standards, or
generally applicable standards, that do not involve regulation of
an MA plan are not pree[mp]ted.” (70 Fed.Reg. 4588, 4665 (Jan.
28, 2005), italics added; see Uhm, supra, 620 F.3d at p. 1156.
The final rule thus clarified CMS’s view that, as to the
regulation of MA plans, federal standards established under
Part C supersede duties established under common law.
In support of his argument that the Part C preemption
provision does not reach common law duties, Quishenberry
relies on the Court of Appeal’s decisions in Yarick and Cotton,
which read the portion of the provision identifying what is
preempted — “ ‘any State law or regulation’ ” — to exclude
common law. (Yarick, supra, 179 Cal.App.4th at p. 1165; see
also Cotton, supra, 183 Cal.App.4th at pp. 449–451.) Yarick’s
discussion of the scope of express preemption under Part C is
notably brief: The court observed that language like that found
in Part C “usually is interpreted to preempt only ‘positive state
enactments,’ that is, laws and administrative regulations, but
not the common law.” (Yarick, at pp. 1165–1166.) In support of
this observation, the Yarick court cited, without discussion, the
United States Supreme Court’s decision in Sprietsma, supra,
537 U.S. 51, which interpreted a differently worded express
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preemption provision in the FBSA as not reaching common-law
tort claims. (Id. at p. 64.) In Cotton, the Court of Appeal relied
on Yarick and Sprietsma to conclude that the Part C preemption
provision was inapplicable to common-law claims. (Cotton,
supra, 183 Cal.App.4th at p. 450.) The Court of Appeal in
Roberts, supra, 2 Cal.App.5th at pp. 144–145 disagreed,
rejecting Sprietsma’s reasoning as largely irrelevant to the
interpretation of the Part C preemption provision. We conclude
the Roberts panel has the better view: The U.S. Supreme
Court’s reasoning in Sprietsma, which is based on the distinct
language and statutory context of the FBSA preemption
provision, does not control our analysis.
The preemption provision at issue in Sprietsma reads:
“ ‘[A] State . . . may not establish, continue in effect, or enforce a
law or regulation establishing a recreational vessel or associated
equipment performance or other safety standard . . . that is not
identical to a regulation’ ” prescribed under the FBSA.
(Sprietsma, supra, 537 U.S. at pp. 58–59, quoting 46 U.S.C. §
4306.) In support of its holding that this provision did not reach
common-law duties, the U.S. Supreme Court observed that “the
article ‘a’ before ‘law or regulation’ implies a discreteness —
which is embodied in statutes and regulations — that is not
present in the common law.” (Sprietsma, at p. 63.) The Part C
preemption provision, by contrast, applies to “any State law or
regulation” concerning MA plans, suggesting a broader
preemptive effect. (42 U.S.C. § 1395w-26(b)(3), italics added;
see Uhm, supra, 620 F.3d at p. 1153 [“The [Part C preemption
provision’s] use of ‘any’ negates the ‘discreteness’ that the Court
identified in Sprietsma”].) As noted above, the FBSA also
contains a savings clause specifying that FBSA compliance
“does not relieve a person from liability at common law or under
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Opinion of the Court by Groban, J.
State law.” (46 U.S.C. § 4311(h).) The U.S. Supreme Court
considered this clause evidence that the language of the FBSA
preemption provision “ ‘permits a narrow reading that excludes
common-law actions.’ ” (Sprietsma, at p. 63.) The Medicare Act
contains no equivalent savings clause or any other affirmative
indication that Congress intended to preserve common-law
duties. (See Uhm, at p. 1153.) For these reasons, we agree with
the Roberts panel that Sprietsma is distinguishable. (Roberts,
supra, 2 Cal.App.5th at pp. 144–145.) We accordingly conclude
that the scope of the Part C preemption provision extends to
common-law duties.
3. The Provision’s Scope Extends to Duties
Established by State Laws Not Specifically
Targeted at MA Plans
Quishenberry also argues, relying on Cotton, that the
phrase “with respect to MA plans” in the Part C preemption
provision indicates that the provision does not expressly
preempt claims based on state “statutes of general
applicability,” such as his claim under the Elder Abuse Act. (See
Cotton, supra, 183 Cal.App.4th at p. 450 [Part C preemption
provision “extends only to positive state laws or regulations
‘with respect to MA plans.’ ”].) Quishenberry would have us
construe the provision as reaching only those state statutes and
regulations that specifically refer to and target MA plans. By
contrast, UnitedHealthcare and Healthcare Partners argue that
standards established under Part C preempt even those state
standards that are set out in generally applicable laws. They
understand the phrase “with respect to MA plans” to indicate
that the preemptive effect is limited to state-law standards
concerning MA plans offered by MA organizations; standards
governing other types of health plans are not preempted.
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Opinion of the Court by Groban, J.
(42 U.S.C.
§
1395w-26(b)(3).
We
conclude
that
UnitedHealthcare and Healthcare Partners offer the better
reading.
The U.S. Supreme Court addressed a similar question in
Riegel, in which it interpreted the phrase “ ‘with respect to’ ” in
the preemption clause of the 1976 Medical Device Amendments
to the Federal Food, Drug, and Cosmetic Act. (Riegel, supra
552 U.S at p. 316.) The relevant statutory language read:
“ ‘[N]o State or political subdivision of a State may establish or
continue in effect with respect to a device intended for human
use any requirement. . . .’ ” (Ibid., italics added.) The court
rejected the argument that state tort duties were not preempted
because they were “not requirements maintained ‘ “with respect
to devices.” ’ ” (Id. at p. 327, italics added.) It concluded that
“[n]othing in the statutory text suggests that the pre-empted
state requirement must apply only to the relevant device, or only
to medical devices and not to all products and all actions in
general.” (Id. at p. 328; cf. Pilot Life Ins. Co. v. Dedeaux (1987
481 U.S. 41, 47–48 [interpreting the phrase “relate to” in
ERISA’s preemption provision as “not limited to ‘state laws
specifically designed to affect employee benefit plans’ ”].
Similar reasoning applies to the Part C preemption
provision: The phrase “with respect to” does not indicate that
only those state laws and regulations that specifically refer to
MA plans are preempted. The standards established under Part
C preempt even those duties set out in generally applicable state
statutes, but only as they apply to “MA plans which are offered
by MA organizations.” (42 U.S.C. § 1395w-26(b)(3); see Uhm,
supra, 620 F.3d at p. 1150, fn. 25; Roberts, supra, 2 Cal.App. at
p. 47; cf. Rutledge, supra, 141 S.Ct. at pp. 479-481 [describing
the scope of the requirement that state laws, to be preempted by
16
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
Opinion of the Court by Groban, J.
ERISA, must “relate to any employee benefit plan”].)5 As CMS
explained in the final rule implementing the 2003 amendment,
discussed above, federal standards established under Part C
supersede “all State standards . . . to the extent they specifically
would regulate MA plans,” other than “State licensing and
solvency laws.” (70 Fed.Reg., supra, at p. 4665, italics added).
These include state statutory or regulatory provisions that
specifically reference MA plans and duties established under
generally applicable state law when invoked to regulate MA
plans. (Id.
In sum, contrary to Quishenberry’s contentions, Congress
did not categorically carve out and save from preemption state-
law claims based on duties that duplicate federal standards,
common law actions, or statutes of general applicability.
Instead, it intended the standards established under Part C to
supersede any state-law duty with respect to MA plans,
regardless of whether that duty is grounded in statutory or
common law, and even when the state-law duty is not
inconsistent with and instead is based on and duplicates
standards established under Part C.
C. Quishenberry’s Claims Are Expressly Preempted
We next consider whether Quishenberry’s claims fall
within the domain preempted by Part C’s preemption provision.
(See Medtronic, supra, 518 U.S. at p. 484; Aylward, supra,
5
We disapprove Yarick v. PacfiCare of California, supra,
179 Cal.App.4th 1158, and Cotton v. StarCare Medical Group,
Inc., supra, 183 Cal.App.4th 437 to the extent they conclude that
the scope of Part C’s preemption provision is limited to positive
state enactments. We also disapprove Cotton to the extent it
concludes that the Part C preemption provision only reaches state
laws and regulations specifically targeting MA plans.
17
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
Opinion of the Court by Groban, J.
35 F.4th at p. 680.) The touchstone of this inquiry is whether
there is a federal standard under Part C that supersedes the
duty alleged under state law or regulation. To make this
determination, we compare the state-law duties Quishenberry
seeks to enforce to standards established under Part C. (See
Aylward, at p. 680.
Quishenberry’s operative second amended complaint sets
out claims under the state Elder Abuse Act and the common law.
He
supports
these
claims
with
allegations
that
UnitedHealthcare — his father’s HMO MA plan — and
Healthcare Partners — a healthcare services administrator —
failed to ensure that his father’s physician and skilled nursing
facility provided the benefits to which he was entitled under
Part C, resulting in his discharge from the skilled nursing
facility under circumstances in which Medicare rules required
that he remain there for an additional 76 days. As pled against
these entities, therefore, Quishenberry’s claims are ultimately
premised on a single alleged duty: The duty to ensure his father
received the services to which he was entitled under Part C and
the terms of his MA plan, specifically, 100 days of skilled
nursing facility care.6
To determine the truth of Quishenberry’s allegations, a
state factfinder would have to decide whether Quishenberry’s
father was entitled to the skilled nursing care benefits
Quishenberry claims his father should have received. This
would involve applying standards established under Part C. MA
6
Quishenberry does not dispute the Court of Appeal’s
determination that the same federal duties apply to Healthcare
Partners and UnitedHealthcare; our analysis assumes that
determination is correct.
18
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
Opinion of the Court by Groban, J.
regulations require organizations to provide MA enrollees the
benefits to which they are entitled under Parts A and B. (See
42 U.S.C. § 1395w-22(a)(1)(A) [MA plan “shall provide to”
enrollees “through providers and other persons . . . benefits
under the original medicare fee-for-service program option”];
42 C.F.R. § 422.101(a) [MA organizations must “[p]rovide
coverage of, by furnishing, arranging for, or making payment
for, all services that are covered by Part A and Part B”].
Quishenberry’s claims are based on Part A’s provision of
coverage for “post-hospital extended care services for up to 100
days during any spell of illness.” (42 U.S.C. § 1395d(a)(2)(A).
To determine whether Quishenberry’s father was entitled to the
full 100 days of skilled nursing facility care under this provision,
a state factfinder would need to apply criteria detailed in
Medicare regulations, for example: “[T]he beneficiary must
require skilled nursing or skilled rehabilitation services, or both,
on a daily basis” and “[t]he daily skilled services must be ones
that, as a practical matter, can only be provided in a [skilled
nursing facility], on an inpatient basis.” (42 C.F.R. §
409.31(b)(1) & (b)(3).) To determine whether UnitedHealthcare
and Healthcare Partners had a duty to ensure the provision of
these services, state courts would look to standards established
under Part C governing the duties of Medicare Advantage
organizations. (See, e.g., 42 C.F.R. § 422.504(a)(3)(i) [requiring
MA organizations, as part of their contracts with the Centers for
Medicare and Medicaid Services, to agree to provide “[t]he basic
benefits as required under [42 C.F.R.] § 422.101”]; 42 C.F.R.
§ 422.752(a)(1) [authorizing the imposition of sanctions against
MA organizations that “[f]ail[] substantially to provide
medically necessary items and services” required by law or
contract].) UnitedHealthcare and HealthCare Partners’
19
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
Opinion of the Court by Groban, J.
liability therefore hinges on a determination of noncompliance
with a duty rooted in federal standards established under Part
C. (See Riegel, supra, 552 U.S. at p. 324 [explaining how federal
standard may be enforceable under state law].) Because the
state-law duty Quishenberry alleges is ultimately based
on these standards, his claims are preempted. (42 U.S.C. §
1395w-26(b)(3).
Attempting to save his claims from preemption,
Quishenberry characterizes them as “based on treatment
decisions, not benefits determinations.” He points to his
allegations that UnitedHealthcare and Healthcare Partners
“acquiesced to, encouraged, directed, aided and abetted” the
decision of the skilled nursing facility and doctor not to provide
covered services to his father to reduce costs and increase
profits. Quishenberry’s complaint makes clear, however, that
the resolution of his claims against UnitedHealthcare and
Healthcare Partners would ultimately turn on the
determination whether his father qualified for additional skilled
nursing facility care under Part C and related regulations. In
support of his claims against these entities, Quishenberry
alleges “Medicare rules required that” his father remain at the
skilled nursing facility “for more intense attention to his health
care needs,” “Medicare rules make provision for longer periods
for participation in physical therapy given the presence of [his
father’s] pressure sores,” and specifically, he alleges that his
father was “entitled under Medicare to another period of 76 days
of care at [the skilled nursing facility] with daily care of his
pressure sores and daily physical therapy.” To find
UnitedHealthcare or Healthcare Partners liable for breach of
the alleged duty to ensure he received these services, a
factfinder would have to apply the standards established under
20
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
Opinion of the Court by Groban, J.
Part C to determine whether his father was entitled to them.
Quishenberry’s claims, therefore, are based on state-law duties
that are duplicative of standards established under Part C.
For these reasons, we conclude that Part C’s preemption
provision expressly preempts Quishenberry’s claims against
UnitedHealthcare and Healthcare Partners.7 In so concluding,
we note again that Quishenberry’s claims against his father’s
skilled nursing facility and treating physician are not before us;
this appeal is concerned with the liability of the provider and
the administrator of an MA plan. Quishenberry’s allegations
against these entities are not based on treatment
decisions (which they did not make) or provision of care (which
they did not undertake) but instead on their duties under Part
C and related regulations to ensure Quishenberry’s father
received the benefits to which he was entitled under his MA
plan. Because Quishenberry’s state-law claims against
UnitedHealthcare and Healthcare Partners are based on duties
arising under Part C, they are preempted.8
7
Because we conclude that Quishenberry’s claims are
expressly preempted, we do not address the alternative implied
preemption arguments made by UnitedHealthcare and
Healthcare Partners.
8
The Attorney General submitted an amicus curiae brief
cautioning against an overly broad reading of the Part C
preemption provision that would impinge on the State’s ability to
protect California’s millions of Medicare beneficiaries though
various state-law enforcement actions. He argues that “Congress
did not intend to provide MA plans with blanket immunity from
basic health and safety obligations grounded in state law that
apply to all persons and entities statewide, or other generally
applicable laws that do not undermine the administration of the
21
QUISHENBERRY v. UNITEDHEALTHCARE, INC.
Opinion of the Court by Groban, J.
III. Conclusion
For the reasons discussed above, Quishenberry’s claims
are expressly preempted by Medicare Part C’s preemption
provision. Accordingly, we affirm the Court of Appeal’s
judgment.
GROBAN, J.
We Concur:
GUERRERO, C. J.
CORRIGAN, J.
LIU, J.
KRUGER, J.
JENKINS, J.
EVANS, J.
federal MA program.” We agree. This case does not directly
implicate the Attorney General’s enforcement powers and nothing
we say here would provide MA plans with blanket immunity from
basic health and safety obligations grounded in state-law
standards or in other state laws and regulations that are not
superseded by standards established under Part C.
22
See next page for addresses and telephone numbers for counsel who
argued in Supreme Court.
Name of Opinion Quishenberry v. UnitedHealthcare, Inc.
Procedural Posture (see XX below
Original Appeal
Original Proceeding
Review Granted (published)
Review Granted (unpublished) XX NP opn. filed 9/21/21 – 2d Dist.,
Div. 7
Rehearing Granted
Opinion No. S271501
Date Filed: July 13, 2023
Court: Superior
County: Los Angeles
Judge: Ralph C. Hofer
Counsel:
Balisok & Associates and Russell S. Balisok for Plaintiff and
Appellant.
Gibson, Dunn & Crutcher, Kahn A. Scolnick, Heather L. Richardson,
Jennafer M. Tryck, Patrick J. Fuster; Walraven & Westerfeld, Bryan
S. Westerfeld, Jessica B. Hardy; Carroll, Kelly, Trotter & Franzen,
Michael J. Trotter, Brenda M. Ligorsky and David P. Pruett for
Defendants and Respondents.
Cole Pedroza, Curtis A. Cole and Cassidy C. Davenport for California
Medical Association, California Dental Association and California
Hospital Association as Amici Curiae on behalf of Defendants and
Respondents.
King & Spalding, Ethan P. Davis and Matthew V.H. Noller for
Chamber of Commerce of the United States of America as Amicus
Curiae on behalf of Defendants and Respondents.
Fred J. Hiestand for Civil Justice Association of California as Amicus
Curiae on behalf of Defendants and Respondents.
Rob Bonta, Attorney General, Renu R. George, Assistant Attorney
General, Kathleen Boergers, Bryan Kao and Anna Rich, Deputy
Attorneys General, for the Attorney General of California as Amicus
Curiae.
Counsel who argued in Supreme Court (not intended for
publication with opinion):
Russell S. Balisok
Balisok & Associates, Inc.
37592 Zeolite Hills Road
Corvallis, OR 97330
(818) 389-7890
Kahn A. Scolnick
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue
Los Angeles, CA 90071-3197
(213) 229-7656
Opinion Information
Date: | Docket Number: |
Thu, 07/13/2023 | S271501 |