Jessica Frenkel


Under the current health care financing regime, managed care organizations have significant power to determine patients' care but no legal responsibility when they use that power to pursue profits and harm patients. Managed care organizations are shielded from liability because the Employee Retirement Income Security Act of 1974 (ERISA) preempts state causes of action and does not provide a comparable remedy. This Comment attempts to restart a conversation about the dangers of allowing managed care organizations to retain significant power over patient care without any risk of liability of an especially vulnerable subgroup of patients: the severely mentally ill. It begins by recounting the conditions under which managed care first emerged. Next, this Comment illustrates through three case vignettes how ERISA's preemption provisions transform otherwise cognizable claims for wrongful death into claims that cannot be heard on their merits. It then argues that the severely mentally ill are at special risk of harm from managed care cost cutting and exposes the social tragedies and legal ironies engendered by ERISA preemption. Finally, this Comment argues that solutions exist to remedy ERISA preemption but predicts that these solutions will not be implemented barring a shift in national priorities.