Supreme Court Decisions Boost Patient Privacy, Strengthen Employer Workplace Arbitration

Article excerpt

The United States Supreme Court recently handed down major and long-awaited decisions boosting the privacy fights of hospital patients and strengthening the ability of employers to enforce arbitration agreements.

In the case of Egelhoff v. Egelhoff, the court ruled that the Employee Retirement Income Security Act of 1974 (ERISA) covers the designation of beneficiaries even when state law might shift beneficiaries in the case of divorce. The Egelhoff case presented the question of whether Washington State's divorce revocation statute is preempted by ERISA. In a 7-2 decision, the justices found that a federal law for employee retirement income plans trumps a Washington law dealing with who is a qualified beneficiary for those plans.

This decision will likely lead to the invalidation of similar laws passed by a number of other states and local governments. In the case before the court, Washington state law automatically revoked beneficiary designations upon divorce. But the court ruled that in plans such as pensions and life insurance covered by ERISA, laws like Washington's do not operate automatically. Justice Thomas wrote the opinion. Dissenting were Justices Breyer and Stevens.

In the medical privacy case, the court struck down a Charleston, S.C., program under which police were informed when women seeking prenatal care at a public hospital tested positive for illegal drug use. The court ruled 6-3 in City of Charleston v. Ferguson, that the program violated the 4th Amendment bar against unreasonable searches and seizures.

"Their motive was benign rather than punitive," said Justice John Paul Stevens of the city officials who designed the program. "Such a motive, however, cannot justify a departure from Fourth Amendment protections. ... The stark and unique fact that characterizes this case is that [the policy] was designed to obtain evidence of criminal conduct by the tested patients that would be turned over to the police and that could be admissible in subsequent criminal prosecutions." Justice Antonin Scalia, joined by Chief Justice William Rehnquist and Justice Clarence Thomas, dissented.

The arbitration decision, Circuit City v. Adams, could substantially alter workplace relationships. By a 5-4 vote, the court said that the Federal Arbitration Act requires enforcement of arbitration agreements in all employment categories except for a narrow class of seamen and other transportation workers exempted by the law in 1925. Employee and civil rights groups as well as several states, had sought a broader definition of that exception that would have allowed any workers involved in interstate commerce to circumvent arbitration and pursue employment claims in court. …