Obama's Supreme Court Pick and Federal Employees

Alex Parker pointed me to this court decision Sonia Sotomayor, President Obama's pick to join the Supreme Court, wrote in deciding a case about insurance reimbursements and the Federal Employees Health Benefits Program. It's not a hugely complicated case: a FEHBP participant was injured in an accident, resulting in more than $150,000-worth of care paid for by his insurance company. When his family won more than $3 million in a lawsuit over his injuries, his insurance provider put a lien on them for the money and then sued them to recover it. The provider argued that the rules governing FEHB contracts constitute federal common law, giving judges the ability to enforce them, saying that if state reimbursement laws could preempt FEHB contracts, it would result in uneven enforcement. Sotomayor ruled that her court did not have jurisdiction because the contracts are contracts, rather than common law, and that the risk of uneven enforcement is very low. In other words, the case doesn't strike at any core benefits issues. But it does show that Sotomayor views FEHB as a business arrangement rather than federal law.