On July 26, 2013, the US Court of Appeals for the Seventh Circuit issued an opinion in Larson v. United Healthcare Insurance Company, holding that the insurer of an insured ERISA health plan can be sued for benefits under ERISA Section 502(a)(1)(B) if the insurer decides all eligibility questions and owes benefits under the plans.

The plaintiffs, insured individuals under employer health plans underwritten by six defendant insurers, claimed that the insurers violated state insurance law by requiring copayments for chiropractic care. The insurers made eligibility determinations and paid benefits under the plans. The plaintiffs sued the insurers for benefits under ERISA Section 502(a)(1)(B), but the insurers argued, among other things, that they were not proper defendants under Section 502(a)(1)(B).

The district court concluded that the plaintiffs could not sue the insurers under Section 502(a)(1)(B) and dismissed the claim. The district court relied on a line of Seventh Circuit decisions holding that an ERISA claim for plan benefits ordinarily should be brought against the plan. The plaintiffs appealed to the Seventh Circuit.

The Seventh Circuit affirmed the district court, though on different reasoning. The Seventh Circuit noted that although ERISA specifies who can sue under the statute, it does not address who can be sued. The court recognized that, as general rules under its case law:

The court added, however, that an ERISA claim for benefits must be brought against the party having an obligation to pay, and that these "obligors" are therefore proper defendants in an ERISA claim to recover plan benefits. For an insured ERISA health plan, in which the plan's insurer decides eligibility and benefits questions and pays claims, an ERISA claim for benefits against the insurer is therefore permissible.

According to the Seventh Circuit, another provision under the statute's civil enforcement rules, ERISA Section 502(d), did not conflict with this outcome. Section 502(d)(2) generally provides that a money judgment against a plan is:

The Seventh Circuit reasoned that Section 502(d)(2):

Also, the Seventh Circuit acknowledged that one of its prior decisions, Mote v. Aetna Life Ins. Co., suggested a general rule against suing insurers for benefits under ERISA. In Mote, the Seventh Circuit stated that a lower court had correctly dismissed an insurer as an improper defendant in a Section 502(a)(1)(B) claim. However, that case was distinguishable because:

As a result, the Seventh Circuit in Larson concluded that:

As the Seventh Circuit recognizes in its proper defendant analysis, this decision is consistent with the Ninth Circuit's en banc ruling in Cyr v. Reliance Standard Life Insurance Co. (2011), in which that court overruled several of its own prior decisions to conclude that an insurer could be a proper defendant in an ERISA Section 502(a)(1)(B) claim for benefits.

Other courts, too, appear to be adopting a more expansive view of which entities (that is, other than the plan and ERISA plan administrator) may be held liable under Section 502(a)(1)(B). Earlier this year, for example, the Fifth Circuit concluded that a third-party administrator could be held liable under Section 502(a)(1)(B) if it exercised "actual control" over the claims administration process, reasoning that: