United States' Amicus Brief Argues Medicare Act Preempts Statutory Consumer Protection and State Common Law Claims

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Since January 1, 2006, Part D of the Medicare Act has provided Medicare beneficiaries with an elective prescription drug benefit option. Under Part D, benefits are administered to beneficiaries through private health insurance companies, known as “sponsors,” which contract with the Centers for Medicare & Medicaid Services (CMS).

In late 2005, Do Sung Uhm and Eun Sook Uhm (the “Uhms”), Medicare beneficiaries, applied for the prescription drug benefit plan offered by Humana (the “Plan”). In accordance with the Uhms’ election to receive benefits under Part D, the Social Security Administration withheld monthly premiums from their social security benefits.

Pursuant to the Plan, the Uhms’ benefits were to begin on January 1, 2006; however, as of February 6, 2006, the Uhms had not received any information from Humana regarding how to obtain their benefits. As a result, the Uhms had to pay out-of-pocket for their prescription medications.

A little over a month after their benefits were supposed to begin, the Uhms filed a class action lawsuit in the United States District Court for the Western District of Washington against Humana Health Plan, Inc., and its parent company, Humana Inc., (“Humana”) entitled Uhm v. Humana, alleging that they failed to receive the prescription drug benefits promised. They alleged claims for violation of several state consumer protection statutes as well as state common law claims of fraud, breach of contract and unjust enrichment.

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