In This Issue:

- NAIC Changes Target Insurance Holding Company System

- Delaware Series LLC Captive Insurance Programs

- State Spotlights

- Insurance Business and Regulatory Law

Excerpt from State Spotlights

Arizona Spotlight By Christina Geremia and John F. Barwell

Two Arizona trial courts recently held that a Medicare Advantage (MA) plan lien is unenforceable. These decisions mirror a long progeny of federal decisions reaching the same result.

In Pradia v. Recovery Management Systems (Maricopa County Cause No. CV2011-014963)(Jan. 25, 2012), the Arizona Superior Court considered whether federal Medicare law preempted Arizona law and provided a private right of action to enforce the MA plan lien. The court, relying on Ferlazzo v. 18th Ave. Hardware, Inc., 33 Misc. 3d 421, 423- 26, 929 N.Y.S.2d 690, 692-94 (Sup. Ct. 2011), held that the MA plan’s right of reimbursement “stemmed from a private contract made with the enrollee,” and not federal law. Further, because Arizona’s anti-subrogation doctrine, as articulated in Allstate Ins. Co. v. Druke, 118 Ariz. 301, 304, 576 P.2d 489, 492 (1978), prohibits the assignment of a personal injury claim, the MA lien was held to be unenforceable under state law...