SIIA calls for action
The Self-Insurance Institute of America has reported that “a national survey reported a surge in the number of employers that are moving to self-insured employee health care plans. HealthLeaders-InterStudy of Nashville reports: “By shifting to self-insured plans, employers look to cut costs and to more closely tailor benefits for individual companies.” The research company also said that major insurers have embraced the self-insured segments by responding with new services.”Against this SIIA has gone on to report that “The introduction of bills that could destroy ERISA protection for self-insuring employers is “the line in the sand” that they predicted at the outset of the 110th Congress.
The bills: “The Health Partnership Through Creative Federalism Act” (HB 506, S 325) would provide federal grants to states to help them pursue their health care initiatives and those grants could possibly include ERISA preemption waivers that would terminate the ability of employers to provide uniform benefits across state lines.
The shot across our bow: SIIA staff attended the first hearing on this bill by the House HELP Subcommittee whose chairman Robert Andrews (D-NJ) said, “ERISA’s effect has created an unintended consequence that prohibits states from regulating employer-sponsored health plans.” Rep. Andrews is apparently ignorant of his party’s role in the bipartisan triumph of ERISA legislation that precisely intended to prohibit states from regulating employer-sponsored health plans.
The initial response: Organizations including the U.S. Chamber of Commerce, the ERISA Industry Committee (ERIC), the Human Resources Policy Association (HRPA), the American Benefits Council (ABC) and the Retail Industry Leaders Associat ion (RILA) spoke against the House bill in its initial hearing, filed additional testimony and issued press releases that demonstrated the poor judgment of proposing to weaken the ERISA system. Many of the points raised by these organizations are included in this Report. SIIA is on the doorstep and is filing comments to all members of the Committee and, at the same time, we are accelerating personal Hill visits to convey our concerns and support for ERISA.
SIIA’s position: The employer-based health care system based on ERISA federal preemption has grown to become the world’s leading private health care network, serving at present 61% of all U.S. employees, dependents and retirees who are covered by private health plans. With coverage of 160 million (according to the U.S. Chamber of Commerce), the ERISA system is the strong point of the U.S. health care system, and should be maintained during the parallel pursuit of improvement s such as extending coverage to the uninsured population.
Immediate SIIA membership response is urgently needed. The 49 members of the House Education and Labor Committee are accessible to all SIIA members, and contact is particularly important by SIIA members from the committee members’ states and districts. Talking points are provided below – and SIIA members are encouraged to add information about the employee populations in representatives’ districts whose health coverage could be threatened by these bills. The list of committee members follows after the talking points.
ERISA encourages employers to provide health care plans. ERISA created a system that encourages employers to offer employee health benefits by permitting th em to administer health plans uniformly and efficiently. This is especially important to employers that operate in multiple states. Without such uniformity, these employers would be faced with a patchwork of complex and conflicting state regulations that would make providing health care benefits far more challenging and expensive. SIIA strongly supports Small Group Health Plans/Association Health Plan legislation that would enable small employers to group their resources and create larger purchasing groups with all funding options available, be they insured or self-insured. Permitting small employers to form pools and permit them to utilize self-insurance to fund benefit programs will go a long way to help reducing the number of uninsureds.
ERISA promotes higher quality health care. Employers with self-insured plans have led efforts to promote consumer awareness and decision-making about their health care in an effort to improve care, often through concentrations of regional specialty practices or “centers of excellence.” Companies have supported improvements in data collection, patient satisfaction and treatment outcomes. Employers recognize the importance of promoting good health among their employees: they are developing innovative programs and incentives to encourage exercise, weight loss, smoking cessation, regular physical examinations and other health practices.
ERISA promotes fairness among employee groups. Multi-state employers need to maintain uniform benefits across state lines for equity reasons, following the common principle that all similarly situationed workers within one company should be entitled to similar benefits regardless of the state in which they reside. Employees receive the benefit of having consistent and clear plan choices, equitable treatment and continuous access to health care benefits across state lines. If all jurisdictions act separately on ERISA waivers it makes all employer plans, especially multi-employer plans, much less efficient and far costlier for the employers as well as their employees.
ERISA plans are preferred by employees. Employees understand the importance of employer-sponsored health coverage and the employer’s role in financing a large share of its expense. In a survey released last month by the National Business Group on Health, two in three respondents (67%) consider their health plan to be excellent or very good. An even greater number (75%) said they valued their plan a s their most important benefit from their employer and about three in every four respondents said they would prefer to get their health benefits through their employer rather than having a salary increase in order to purchase health coverage on their own.
ERISA preemption has been upheld by U.S. courts. Earlier this year the United States Court of Appeals for the Fourth Circuit affirmed a district court decision invalidating a Maryland “fair share” law that attempted to impose a health benefit mandate on employers (Retail Industry Leaders Ass’n v. Fielder, 475 F.3d 180 (4th Cir. 2007). The circuit court held that Maryland’s “fair share” law conflicts with ERISA’s goal of permitting uniform nationwide administration of employer-sponsored health care plans. For a discussion of the legislative history of ERISA’s preemption provision, see Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-100 (1983).
ERISA plans would be undermined by waivers – and they are not necessary. States do not need ERISA waivers in order to implement sound and effective health care reforms for their citizens. The problems most urgently in need of solutions – insuring the unemployed, providing reliable and accessible information on health care cost and quality, making affordable insurance available to small businesses ̵ 1; are outside the scope of ERISA’s preemption provision.
All senators and representatives should become educated on ERISA before they consider damaging it. Sources of information include the U.S. Department of Labor, Bureau of Labor Statistics, National Compensation Survey: Employee Benefits in Private Industry in the United States, March 2006; Paul Fronstin, Sources of Health Insurance and Characteristics of the Uninsured: Updated Analysis of the March 2006 Current Population Survey, Employee Benefits Research Institute (EBRI) Issue Brief No. 305 (May 2007).
What to ask your representative: Please vote NO on any bill that would damage ERISA protections. ERISA is not the problem for U.S. health care – it is the strongest part of the U.S. health care system, providing top quality, equitable and efficient care to many millions of Americans.
Members of the House Education and Labor Committee and the Senate Health, Education, Labor and Pensions (HELP) Committee, with office telephone numbers (additional contact information is available at www.house.gov or www.senate.gov).
George Miller (D-CA 7th), Chair, 202-225-2095
Dale Kildee (D-MI 5th) 202-225-3611Donald Payne (D-NJ 10th) 202-225-3436Robert Andrews (D-NJ 1st) 202-225-6501Bobby Scott (D-VA 3rd) 202-225-8351Lynn Woolsey (D-CA 6th) 202-225-5161Ruben Hinojosa (D-TX 15th) 202-225-2531Carolyn McCarthy (D-NY 4th) 202-225-5516John Tierney (D-MA 6th) 202-225-8020Dennis Kucinich (D-OH 10th) 202-225-5871David Wu (D-OR 1st) 202-225-0855Rush Holt (D-NJ 12th) 202-225-5801Susan Davis (D-CA 53rd) 202-225-2040Danny Davis (D-IL 7th) 202-225-5006Raul Grijava (D-AZ 7th) 202-225-2435Tim Bishop (D-NY 1st) 202-225-3826Linda Sanchez (D-CA 39th) 202-225-6676John Sarbanes (D-MD 3rd) 202-225-4016Joe Sestak (D-PA 7th) 202-225-2011Dave Loebsack (D-IA 2nd) 202-225-6576Mazie Hirono (D-HI 2nd) 202-225-4906Jason Altmire (D-PA 4th) 202-225-2565John Yarmuth (D-KY 3rd) 202-225-5401Phil Hare (D-IL 17th) 202-225-5905Yvette Clark (D-NY 11th) 202-225-6231Joseph Courtney (D-CT 2nd) 202-225-2076Carol Shea-Porter (D-NH 1st) 202-225-5456Howard McKeon (R-CA 25th), Ranking Member, 202-225-1956Thomas Petri (R-WI 6th) 202-225-2476Peter Hoekstra (R-MI 2nd) 202-225-4401Michael Castle (R-DE At-large) 202-225-4165Mark Souder (R-IN 3rd) 202-225-4436Vernon Ehlers (R-MI 3rd) 202-225-3831Judy Biggert (R-IL 13th) 202-225-3515 Todd Platts (R-PA 19th) 202-225-5836Ric Keller (R-FL 8th) 202-225-2176Joe Wilson (R-SC 2nd) 202-225-2452John Kline (R-MN 2nd) 202-225-2271Bob Inglis (R-SC 4th) 202-225-6030Cathy McMorris (R-WA 5th) 202-225-2006Kenny Marchant (R-TX 24th) 202-225-6605Tom Price (R-GA 6th) 202-225-4501Res. Com. Luis Fortuno (R-PR At-large) 202-225-2615Charles Boustany (R-LA 7th) 202-225-2031Virginia Foxx (R-NC 5th) 202-225-2071Randy Kuhl (R-NY 29th) 202-225-3161Rob Bishop (R-UT 1st) 202-225-0453David Davis (R-TN 1st) 202-225-6356Tim Walberg (R-MI 7th) 202-225-6276
Senate HELP Committee:
Ted Kennedy (D-MA), Chair, 202-224-4543Christopher Dodd (D-CT) 202-224-2823Tom Harkin (D-IA) 202-224-3254Barbara Mikulski (D-MD) 202-224-4654Jeff Bingamen (D-NM) 202-224-5521Patty Murray (D-WA) 202-224-2621Jack Reed (D-RI) 202-224-4642Hillary Clinton (D-NY) 202-224-4451Barack Obama (D-IL) 202-224-2854Sherrod Brown (D-OH) 202-224-2315Mike Enzi (R-WY) Ranking Member, 202-224-3424Judd Gregg (R-NH) 202-224-3324Lamar Alexander (R-TN) 202-224-4944Richard Burr (R-NC) 202-224-3154Johnny Isackson (R-GA) 202-224-3643Lisa Murkowski (R-AK) 202-224-6665Orrin Hatch (R-UT) 202-224-5251Pat Roberts (R-KS) 202-224-4774Wayne Allard (R-CO) 202-224-5941Tom Coburn (R-OK) 202-224-5754Bernard Sanders (I-VT) 202-224-5141
About SIIA
The Self-Insurance Institute of America, Inc. (SIIA) is only national association dedicated exclusively to protecting and promoting the self-insurance and alternative risk transfer industry. Since its founding in 1981, the association has grown significantly and now includes members from across the nation and several countries around the world. Major membership constituencies include self-insured employers (healthcare and Workers' Compensation), group self-insured Workers' Compensation funds (SIFs), third-party administrators (TPAs), managing general underwriters (MGUs), excess/stop-loss insurance carriers, and a variety of other companies involved in the self-insurance/alternative risk transfer business. Membership benefits and information is available at
www.siia.org/i4a/pages/index.cfm?pageid=3307.
