Most personal injury attorneys in Arizona, and many attorneys throughout the country, are keeping a close eye on Aetna Life Insurance Company v. Kobold, which is currently before the United States Supreme Court. Kobold, is an appeal from a decision by the Arizona Court of Appeals in which the Arizona court held that the Federal Employee Health Benefits Act (“FEHBA”) did not preempt Arizona’s anti-subrogation statute.
As background, Aetna provided health benefits to Matthew Kobold, who was a federal employee injured in an accident caused by a third party. When Mr. Kobold recovered money from the person that injured him, Aetna demanded a reimbursement of the health benefits according to the terms of the health insurance policy in spite of the fact that Arizona law prohibits such reimbursement. The Court of Appeals’ ruling would have permitted Mr. Kobold to retain more of the money from his personal injury settlement.
Since the appeal was filed, the Office of Personnel Management issued new regulations to address the arguments raised in Kobold and to maintain and strengthen the ability of an FEHB carrier to subrogate and seek reimbursement from federal employees injured by others despite state law.
Within the past few weeks, the United States Supreme Court granted certiorari. The Supreme Court vacated the judgment and remanded the case back to the Arizona Court of Appeals “for further consideration in light of new regulations promulgated by the Office of Personnel Management.” We shall see what happens, but it does not look good for accident victims who are federal employees.
If you were injured by someone else, feel free to contact the Law Office of Shiloh K. Hoggard, P.L.L.C., for a free consultation.