June 11, 2025

The U.S. Solicitor General (USG) has weighed in on Mulready v. PCMA, a closely watched case challenging an Oklahoma law regulating pharmacy benefit managers (PBMs) that raises fundamental questions about the scope of ERISA preemption.

In a brief filed at the request of the U.S. Supreme Court, the Solicitor General urged the Court not to review the Tenth Circuit’s ruling, which held that portions of Oklahoma’s Patients’ Right to Pharmacy Choice Act are preempted by ERISA. While the brief does not endorse all aspects of the lower court’s reasoning, it ultimately supports the view that the case does not warrant further review, bolstering – at least for now – the principle of national uniformity for ERISA-covered plans.

Background

Mulready v. PCMA centers on several provisions of Oklahoma law that regulate the operations of PBMs, including network adequacy mandates, any willing provider (AWP) requirements, and restrictions tied to pharmacy disciplinary history. The Pharmaceutical Care Management Association (PCMA) challenged the law, arguing that it imposes direct mandates on ERISA-governed health plans by dictating how PBM networks must be structured and which pharmacies must be included, effectively interfering with plan design and administration.

In August 2023, the U.S. Court of Appeals for the Tenth Circuit ruled in favor of PCMA, concluding that several of the Oklahoma law’s provisions are preempted by ERISA. The court found that unlike state laws regulating PBM reimbursement rates or claims practices, the Oklahoma provisions went further, compelling plans to adopt specific network structures that conflict with ERISA’s goal of uniform plan administration.

Oklahoma petitioned the Supreme Court to hear the case in May 2024. In October, the Court invited the Solicitor General, representing the federal government’s interest and often influential in shaping SCOTUS review decisions, to weigh in on whether the petition should be granted.

Solicitor General’s Brief

In the new brief filed in May 2025, the Solicitor General recommends denial of Oklahoma’s petition for certiorari. While the brief explicitly does not endorse all aspects of the Tenth Circuit’s decision, it broadly agrees with the outcome that the Oklahoma provisions at issue are indeed preempted by ERISA and do not present a conflict that merits Supreme Court intervention.

Notably, the Solicitor General distinguishes Mulready from the Supreme Court’s 2020 decision in Rutledge v. PCMA, which upheld a state PBM law focused on reimbursement rates. The brief emphasizes that Mulready involves materially different provisions that go beyond claims processing and reach into network composition and benefit design. In doing so, the Solicitor General implicitly supports the position that states cannot impose structural mandates on ERISA plans through PBM regulation.

This is a conclusion similar to that of the U.S. District Court for the Eastern District of Tennessee in McKee Foods Corp v. BFP, Inc., another recent case centered around a state AWP law. In that decision, the court rejected the state of Tennessee’s arguments that the law merely regulated PBM and pharmacy costs and concluded that these mandates have an “impermissible connection with” ERISA plans and therefore ought to be preempted by the federal law.

Implications for ERISA Preemption and Employer Plans

For employer plan sponsors, the Solicitor General’s brief is a welcome development. It reflects a clear position from the federal government that ERISA preemption continues to apply to state laws that interfere with core elements of plan design, such as provider network configuration and eligibility rules. It also signals that the Trump administration, at least in this context, is not seeking to roll back or weaken ERISA’s preemptive reach.

That said, the brief avoids broadly affirming all the lower court’s arguments, and it does not signal a complete rejection of future state efforts to regulate PBMs. Several states, such as Florida and North Dakota, have enacted or proposed similar legislation that could be impacted by the outcome in Mulready, and more litigation is likely to follow.

The Supreme Court will decide in the coming months whether to grant certiorari and hear the case. If the Court follows the Solicitor General’s recommendation, the Tenth Circuit’s decision may stand, reinforcing ERISA preemption as a barrier to certain state-level PBM laws.

The Business Group continues to support strong federal preemption under ERISA as essential to preserving the ability of large employers to offer consistent health benefits nationwide. We will keep members informed of any further developments in the Mulready case and other litigation that could impact plan design and administration.

We provide this material for informational purposes only; it is not a substitute for legal advice.

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Resource Pharmacy Plan Design & Administration Employee Retirement Income Security Act (ERISA)