Introduction

This appeal sits at the intersection of ERISA preemption and state regulation of insurance. BlueCross BlueShield of Tennessee (BlueCross)—both the issuer and administrator of a Tennessee group health policy—denied a New Hampshire employee’s fertility-treatment claims under plan terms that exclude such benefits. New Hampshire law, however, mandates coverage for medically necessary fertility treatment. The New Hampshire Insurance Commissioner initiated an administrative enforcement action seeking civil penalties and a cease-and-desist order against BlueCross for alleged violations of the state’s insurance code.

BlueCross sued in federal court under ERISA § 502(a)(3), arguing that the state proceeding interfered with its fiduciary duties to decide claims in accordance with plan documents. The district court ultimately granted summary judgment to the Commissioner; the Sixth Circuit affirmed. The pivotal issue was characterization: Did the Commissioner proceed against BlueCross in its fiduciary capacity (which would implicate ERISA’s uniform fiduciary framework) or in its capacity as an insurer (which falls within ERISA’s “saving clause” for state insurance laws)?

The Sixth Circuit’s answer—and the opinion’s key contribution—is a clear capacity-based rule: where a state enforcement action seeks penalties and licensing-related relief for violations of state insurance mandates, it proceeds against the entity as an insurer. In that posture, ERISA’s saving clause applies, and § 502(a)(3) provides no shield, even if the action was triggered by a particular benefit denial made by the insurer acting as an ERISA fiduciary.

Summary of the Opinion

The Sixth Circuit held that New Hampshire’s administrative enforcement was directed at BlueCross in its capacity as an insurer for alleged violations of the state’s mandated-benefit law, not at BlueCross in its capacity as an ERISA fiduciary. The court emphasized:

• The Show-Cause Order’s “Statement of Issues” cited New Hampshire insurance statutes and sought state-law penalties, including a cease-and-desist order barring BlueCross from providing health insurance in New Hampshire—relief that targets BlueCross as an insurer.
• ERISA’s saving clause (29 U.S.C. § 1144(b)(2)(A)) preserves the enforcement of state insurance regulations against insurers.
• UNUM Life Ins. Co. of America v. Ward forecloses using ERISA fiduciary duties to avoid compliance with valid, saved state insurance mandates; allowing otherwise would let insurers nullify state law via plan terms.

The court rejected BlueCross’s contention that the real question was which state’s mandates apply (Tennessee vs. New Hampshire). That framing depended on treating the Commissioner’s action as one against a fiduciary, which the court declined to do. The panel also emphasized that while an ERISA fiduciary may sue under § 502(a)(3), entitlement to relief fails where the action is a saved insurance enforcement against an insurer.

The court left open issues not raised below or not decided by the district court, including whether BlueCross engaged in the “business of insurance” in New Hampshire or whether due process or personal jurisdiction limits might apply. Those questions could be pursued in the state proceedings.

Factual and Procedural Background

Key Facts

• BlueCross (a Tennessee nonprofit) issued and administered a group health policy for PhyNet Dermatology, a Tennessee employer with employees in multiple states, including New Hampshire.
• The plan excluded fertility treatment. A New Hampshire employee (B.C.) sought coverage for fertility procedures in 2020–2021; BlueCross denied the claims as excluded.
• New Hampshire law requires group health carriers to cover medically necessary fertility treatment for certificate holders. The Commissioner asserted BlueCross must comply when issuing coverage to an employer with New Hampshire employees, notwithstanding plan exclusions and a Tennessee choice-of-law provision.
• BlueCross uses the “BlueCard Program,” with Anthem NH acting as the local network; Anthem prices and pays claims that BlueCross adjudicates under the plan, and BlueCross reimburses Anthem.

State Enforcement and Federal Suit

• The Commissioner issued a Show-Cause Order citing New Hampshire insurance statutes, seeking at least $52,500 in penalties and a cease-and-desist order forbidding BlueCross from offering health insurance in the state.
• BlueCross sued in federal court under ERISA § 502(a)(3), arguing the state proceeding interfered with its fiduciary duty to decide claims per plan documents.
• The district court denied BlueCross’s partial summary judgment motion and provided notice under Rule 56(f)(1) of its intent to grant summary judgment to the Commissioner. It later granted summary judgment on all but one issue (ultimately mooted), entering final judgment for the Commissioner.
• On appeal, BlueCross argued the state proceeding targeted it as a fiduciary, not as an insurer, and sought to revive its ERISA-based injunction theory.

Detailed Analysis

1) Precedents Cited and Their Role

• Aetna Health Inc. v. Davila (ERISA’s uniform regulatory regime): Cited to frame ERISA’s broad preemptive scope over employee benefit plan administration.
• Metropolitan Life Ins. Co. v. Massachusetts and FMC Corp. v. Holliday (the saving clause and insurer regulation): Establish that state laws “which regulate insurance” are saved from ERISA preemption and can bind the insurer component of an ERISA plan. FMC’s deemer-clause corollary is that self-funded ERISA plans are not deemed insurers and are not subject to such state insurance regulation.
• UNUM Life Ins. Co. of America v. Ward: The linchpin precedent. Ward holds that an insurer that is also an ERISA fiduciary cannot avoid a saved state insurance rule by invoking ERISA’s fiduciary-duty compliance-with-plan-documents requirement. Permitting that would neuter the saving clause.
• Larson v. United Healthcare Ins. Co. (Seventh Circuit): Reinforces Ward’s insight that mandatory state insurance terms become part of the plan when the plan is funded by insurance.
• Franchise Tax Board v. Construction Laborers Vacation Trust and Thiokol Corp. v. Department of Treasury: Show that ERISA fiduciaries can seek equitable relief under § 502(a)(3) when ERISA rights and duties are at issue, but neither case confronted a saved state insurance enforcement against an insurer.
• Hartman v. Moore and Nieves v. Bartlett: Support the presumption of regularity in prosecutorial decision-making; the court analogized to that presumption when accepting the Commissioner’s enforcement posture as an insurance-law action.
• eBay Inc. v. MercExchange: Addresses the standards and burdens for injunctive relief; relevant to the panel’s observation that BlueCross bore the burden as the injunction-seeking party.
• Walden v. General Electric Int’l (Sixth Circuit): Recites the summary judgment standard applied by the panel.
• Resurrection School v. Hertel (Sixth Circuit) (en banc): Cited for the rule that arguments raised for the first time at oral argument are not preserved.

2) The Court’s Legal Reasoning

The court’s reasoning turns on a crisp capacity analysis grounded in the text and structure of ERISA and on the face of the state enforcement order.

1. Capacity matters. Only plan participants and beneficiaries may sue to challenge a benefits determination under ERISA § 502(a)(1)(B). A state insurance regulator cannot relabel such a claim to gain standing. But a regulator can enforce state insurance laws—saved from preemption—against insurers. The question therefore becomes: In what capacity did New Hampshire proceed against BlueCross?
2. The Show-Cause Order targeted BlueCross as an insurer. The “Statement of Issues” cited New Hampshire insurance statutes, including a fertility-coverage mandate applicable to “health carriers that issue or renew” group policies, and the general sanctions provision for knowing violations of the insurance code. The requested relief—civil monetary penalties and a cease-and-desist order “from offering health insurance in New Hampshire”—is classically insurer-facing, not fiduciary-facing. That dispositively signaled an insurance-enforcement posture.
3. Referencing a particular denial does not transform the action into a fiduciary case. The order’s factual recitation centered on B.C.’s denied claims—a predictable trigger for an enforcement action. The court viewed those facts as evidence of a violation, not as a bid to second-guess a fiduciary decision under ERISA. The presumption of regularity supported treating the action as what it purported to be: insurance-law enforcement.
4. Ward forecloses the fiduciary-duty “escape hatch.” BlueCross argued that enforcing New Hampshire’s fertility mandate would force it to violate § 404(a)(1)(D)’s command to follow plan documents. Ward squarely rejects that theory: saved state insurance regulation cannot be neutralized by contrary plan language; otherwise, insurers could write their way out of state law, nullifying the saving clause.
5. Section 502(a)(3) provides a cause of action, but no relief here. The district court properly exercised jurisdiction over BlueCross’s fiduciary claim for equitable relief. But at summary judgment, because the state was proceeding in insurer-regulatory capacity under saved insurance laws, § 502(a)(3) could not furnish the injunctive relief BlueCross sought. The Sixth Circuit affirmed this merits determination.
6. Which state’s mandate applies is not the threshold question on these facts. BlueCross reframed the dispute as one about whether New Hampshire or Tennessee mandates govern an ERISA fiduciary. That argument presupposed fiduciary-capacity regulation. Because the Commissioner proceeded against BlueCross as an insurer under saved state law, the “which state’s law” question did not displace the saving-clause analysis.
7. Concerns about 50-state variability do not defeat saving-clause enforcement. The court acknowledged administrative burdens but cited Ward and Metropolitan Life for the proposition that nonuniformity is an intended consequence of ERISA’s saving clause.
8. Unraised due process/jurisdiction issues are for the state forum. The panel expressly took no position on whether BlueCross engaged in the business of insurance in New Hampshire or whether personal jurisdiction/due process limits bar enforcement. Those issues were not preserved and remain available in the administrative proceeding.

3) Impact and Practical Consequences

The decision reinforces and operationalizes the saving clause in a way that carries significant practical implications for multistate insured ERISA plans:

• Capacity-based shield/unsheath rule. If a state regulator frames and pursues its action as insurance-law enforcement—citing state insurance statutes and seeking regulatory penalties or licensing relief—ERISA § 502(a)(3) will not bar that proceeding, even when the triggering facts involve a fiduciary’s claim denial under an ERISA plan.
• Mandated benefits can override contrary plan terms for insured plans. For insured ERISA plans, state-mandated benefits (here, fertility coverage) effectively become part of the plan as applied to the insurer. Employers and insurers cannot rely on plan exclusions or choice-of-law clauses to evade saved state mandates where the state can reach the insurer.
• BlueCard and national networks are not safe harbors. Using a local Blue network (e.g., Anthem NH) does not immunize the issuing insurer from the host state’s insurance mandates. Regulators can treat the issuer as subject to local mandates if the issuer provides coverage to in-state employees—subject to any unresolved jurisdictional limits to be litigated locally.
• Forum strategy for disputes over benefits mandates. Participants seeking mandated benefits may find an effective path through state insurance regulators rather than ERISA litigation where the plan is insured. Conversely, insurers should anticipate regulatory scrutiny if plan terms exclude state-mandated benefits.
• Compliance for multistate arrangements. Insurers writing group coverage for employers with multistate workforces must inventory and comply with applicable state mandates in employees’ states of residence or employment. Administrative disuniformity is a feature—not a bug—of the saving clause.
• Insured vs. self-funded distinction remains decisive. The decision does not dilute the deemer clause. Self-funded ERISA plans (not “deemed” insurers) remain outside state insurance regulation; but where an insurer funds the plan, saved state mandates apply to the insurer.

4) Complex Concepts Simplified

• ERISA preemption and the saving clause. ERISA broadly preempts state laws that “relate to” employee benefit plans. But its saving clause preserves state laws that “regulate insurance.” States can enforce those insurance laws against insurers, including insurers that underwrite ERISA plans.
• Deemer clause. A companion rule says states cannot “deem” a self-funded ERISA plan to be an insurer for purposes of state regulation. Thus, state mandates reach insured plans via the insurer, but generally not self-funded plans.
• Fiduciary capacity vs. insurer capacity. An insurer may also act as a plan fiduciary when adjudicating claims under an ERISA plan. But state regulators cannot challenge fiduciary determinations as such; they can enforce insurance statutes against the insurer. The relief sought and statutes invoked reveal the capacity in which the entity is being regulated.
• Section 502(a)(3) relief. ERISA § 502(a)(3) authorizes fiduciaries to seek equitable relief to redress violations of ERISA or the plan. That cause of action does not block a state’s saved insurance enforcement against an insurer; entitlement to relief depends on the nature of the state action.
• Ward’s core lesson. Insurers cannot escape state insurance mandates by pointing to contrary plan terms or the fiduciary duty to follow those terms. The saving clause would be hollow if plan documents could negate state law.
• Presumption of regularity. Courts presume that regulators act within their proper authority. Here, that presumption supported viewing the Commissioner’s proceeding as an insurance enforcement action, not a disguised fiduciary dispute.
• Summary judgment posture. On de novo review, the court looked to whether any genuine disputes of material fact existed regarding the capacity question. Citing the Show-Cause Order and the relief sought, the court concluded as a matter of law that the action targeted BlueCross as an insurer.

5) Open Questions and Issues Reserved

• Jurisdiction and due process. Whether BlueCross “practiced insurance” in New Hampshire and whether New Hampshire has personal jurisdiction or satisfies due process were not addressed and may be litigated in the state forum.
• Choice-of-law and extraterritoriality. The Sixth Circuit did not decide whether Tennessee or New Hampshire law “applies” in any broader sense; the saved-insurance-law analysis focuses on the insurer’s regulation by the enforcing state, not private choice-of-law provisions.
• Penalty calculations. The record did not establish that the proposed $52,500 penalty tracked the dollar value of denied claims; a suggestion to that effect surfaced only at oral argument and was deemed unpreserved. How penalties are calculated under state law remains for the administrative proceeding.

Key Takeaways

• When a state regulator enforces a saved insurance mandate against an insurer—even one serving as an ERISA fiduciary—ERISA § 502(a)(3) cannot be used to enjoin the proceeding.
• The “capacity” in which the entity is targeted is determined by the statutes cited and the relief sought, not by whether the facts involve an ERISA claims decision.
• Ward controls: fiduciary duties to follow plan documents cannot trump saved state insurance mandates for insured plans.
• Multistate insured ERISA plans must prepare for nonuniform compliance; choice-of-law provisions and plan exclusions cannot negate state mandates as applied to the insurer.
• Jurisdictional and due process defenses to a state’s reach over an out-of-state issuer remain viable but must be raised in the proper forum and preserved.

Conclusion

BlueCross BlueShield of Tennessee v. Nicolopoulos (Bettencourt) reinforces a straightforward but consequential principle: ERISA’s saving clause protects state insurance enforcement against insurers even when the insurer also acts as an ERISA fiduciary and even when the enforcement was prompted by a discrete claim denial. The Sixth Circuit’s capacity-centered analysis offers a practical roadmap for courts and regulators: look to the statutes invoked and the relief sought. If the state proceeds under insurance laws to impose regulatory penalties or licensing consequences, ERISA does not stand in the way.

For insurers and employers administering insured ERISA plans across state lines, the opinion underscores the need to account for state mandated benefits—here, fertility coverage—in every state where covered employees reside or receive care. For participants, the decision confirms that state regulators can be effective enforcers of mandated benefits in insured plans. And for ERISA jurisprudence, the case harmonizes the saving clause’s function with fiduciary-governance uniformity: uniform fiduciary standards persist, but not at the expense of states’ traditional authority to regulate the business of insurance.