The Patients' Bill of Rights…
The Right to Sue Employers and Health Plans?
By: Dorothy M. Cociu, RHU, REBC
After spending nearly in a week in Washington, DC and watching our government in action, I'm somewhat surprised that anything gets done at all. Not that I haven't seen it all before. I've attended legislative conferences each year for the past eight years. I've talked to my Congressman and others about health care issues, and they've listened. They may not have agreed, but they listened. I've wandered through the halls of our government, feeling hopeful yet overwhelmed, and have been somewhat proud of our American system, and our ability to walk into a Congressman or Senator's office and gain their attention, if for even a few short minutes in time. Why? To try to make a difference in the way things are done, and in the laws that are passed. To make a difference in the lives of my clients, employers throughout Southern California and throughout the nation.
This year, however, I have a different feeling. Although I knew the issues, or thought I did, going in, I walked out of those buildings not in awe of our government, but in utter amazement, disbelief and astonishment. It was a political battleground like none I'd ever seen.
Speech after political speech, I listened to members of our Congress; United States Senators and Members of the House of Representatives. Speech after speech, I wondered what our government had in mind for us next. Followed by visit by visit to area Congressmen and Senators' offices. And visit after visit, I became more and more nervous for my clients, as their freedom to choose the health plan they desire for their employees may be soon be gone forever. And if not, they may wish that it had, given the new liability provisions for employers as well as health plans which are currently being negotiated in the House-Senate Conference Committee in Washington, DC. Or, better yet, the complete destruction of the employer-based health care system.
So why am I so concerned with current health care legislation? And what are the hot topics in Washington today? The Patients' Bill of Rights. Reducing the number of uninsured. Legal liability for health plans and employers. To name just a few.
Jim Talent (R-MO), a member of the House of Representatives and a prominent member of the House-Senate Conference Committee, addressed the self insured industry at the Self Insurance Institute of America's (SIIA) Legislative Conference in Washington DC on March 2, and discussed the political issues regarding this bill. "This is a very volatile year politically, this is an important issue politically. It makes the road to passing the bill very difficult. What's driving this process now is that there are good things we can do with the right kind of bill, and that politically we need to have a bill."
Nancy Johnson (R-CT), House Conferee, was also a speaker at the SIIA legislative conference on March 2. "I believe we are going to pass the Patients' Bill of Rights."
Overview of Patients' Rights Legislation
The patients' bill of rights includes provisions such as legal liability in state courts for health plans, external review requirements, and funding issues, simply stated. And it isn't intended to be a long, drawn out discussion. Congress has determined that this issue is big. So big, in fact, that they can't make it an election issue. Almost anyone in Washington will tell you it's far too big for any campaign to take on. They can't afford to take that risk, not with both parties scrambling to grab much-needed delegates in the next election. So, the legislative solution is to settle it. Now. Currently the timeline is to have this thing wrapped up by the end of March. Not March, 2001. But March 31, 2000! Wrapped in good intentions to provide a mechanism for consumers to have rights to sue who were harmed in the health care system. But what do they really want to do? The arguments are as fierce as I've seen. Legal liability. Lots of it. For everyone involved in a health plan. Perhaps even the employer, who simply made an effort to provide company-purchased, affordable health care to their employees and families. Is the employer really responsible if a health plan makes a wrong decision or fails to do what's medically necessary for a patient? Since when did employers, who simply write a check each month in many circumstances, become the bad guys when someone in the medical field screws up, or doesn't do what someone else might have done? Even employers who do much more, like those who are self insured, and are involved in designing a plan to best suit the needs of their employees, hire administrators, networks and utilization review/utilization management companies to administer their plans and make health related decisions. Self-insured employers are not in the business of making medical decisions. That's what they hire professionals for.
Ultimately, the area of reform targeted appears to be HMO reform. Nearly all the points brought out by members of Congress relate to care brought about by managed care providers in closed panels; i.e. HMO's. Yet, for some reason, Congress is insisting that they make this issue bigger than it is, and exposing all types of plans to the same legislative solutions. I know there have been HMO concerns with quality of care, but I also know that HMO's have provided inexpensive coverage to many Americans over the past decades that they would not otherwise have been able to afford. Congress doesn't appear to want to hear about the success stories of HMO's or other types of managed care plans. They seem enveloped in this current wrath of HMO's, but intend to spread such wrath across the entire health care marketplace, warranted or not. The issue of liability in health plans, particularly HMO's, seems to be the hottest topic in town. And soon will be across the nation.
The National Association of Health Underwriters (NAHU), a national trade association of health insurance agents, brokers and industry personnel, has gone on record regarding the issue of managed care reform and liability in health plans. "Press accounts abound with stories about denied care and limits on access under managed care plans. In defense of the majority of Americans who are pleased with their health plan, it is important that the other side of the story be told - about the way managed care has worked well for consumers. Although problems arise in any system, many people like managed care and knowingly seek it out and choose it. It has, without a doubt, controlled the costs of health plans to consumers and increased access for thousands of people who might otherwise have not been able to afford health coverage."
"Attempts to exempt employers from liability aren't enough," stated Janet Stokes Trautwein, NAHU Director of Federal Policy Analysis. "They don't keep premiums from going up on other health plans, and they don't really exempt self-funded employers, who are never exempt from fiduciary liability for their plans. NAHU supports a binding independent external medical review to address the issue of health plan accountability. Binding external review will provide a real means for consumers to get the care they are entitled to when they need it without the cost increases associated with new lawsuits for health plans and employers."
Self Insurance and ERISA Protections
Many self-insured employers already have some or most of the provisions the government is insisting they want in every health plan. The right to sue (which is allowed by ERISA for breach of contract issues, deceptive trade practices and other business violations), more choice, and fee for service contracts. But self insured employers, because they have designated as plan fiduciaries, may have more severe liability under the House bill on patients' rights than a fully insured employer, depending on the final scope of the bill, as negotiated by the conference committee.
There is a misconception in Washington about ERISA. As this impacts a good percentage of my own clients, who are self insured, I have sincere concerns. "Since ERISA passed in 1974, you've seen approximately 125,000 million people get coverage in the private system, under ERISA plans, of which about half are in the self insured community. Yet, some people continue to say that ERISA is a barrier to consumers. ERISA is a funding alternative that's available to people to provide more flexible benefits and to provide benefits that the workforce needs, without being stuck with a whole bunch of state mandates," said George Pantos, legislative counsel for the Self Insurance Institute of America.
Another consideration with the patients' bill of rights is the distinction between state and federal regulation of health plans. Proponents of the self-insured industry support federal regulation, as many participants cross state lines, and ERISA regulation allows for plan uniformity, regardless of location. "There are those who would like to see the health benefit system regulated at the state level, because this gives the regulators of the insurance industry more control and more jurisdiction over health plans," said Pantos. "This approach means you have many, many sets of regulations, and that's what ERISA was all about." Self insured plans are concerned with federal pre-emption, and would not like to see such pre-emption weakened by non-related legislation, to allow the states more jurisdiction, as that would under-cut the self insurance option.
When asked about the role of self-insured plans in this health care reform debate, Mr. Pantos stated, "In cases that include quality of care, courts have been finding for liability… There is no documented evidence, there is no anecdotal evidence, that says that employers in self-insured plans are creating problems for participants by depriving them of care, and that this is resulting in personal injury and death. There is no evidence of that. Therefore, why sweep them in? If this bill is going to have any positive effect, it is going to have a distinction between HMO's and self insured health plans."
Summary of Bills
What are they really talking about? Let me attempt to summarize the complex political environment, at least as it relates to health care reform. First, the Senate passed a bill (S 1344) last summer on patients' rights, which included no legal liability provisions. In summary, the bill contained provisions for mandatory and binding external review, emergency room coverage as if in network regardless of location of treatment based on a "prudent person" standard, and a requirement that health plans not prohibit full discussion between a physician and patient of all available treatment options, even if some options are not covered by the plan.
Later, the House passed the Norwood-Dingell bill, HR 2723, which included liability for all parties involved in the health plan decision, which includes employers and administrators, who practice no medicine. After many amendments, re-writes and compromises, the current bill, in the form of HR 2990, entitled the "Bipartisan Consensus Managed Care Improvement Act", includes the following: it requires new approval and appeal procedures, including mandatory binding external review; external appeals may be done based on a denial due to medical necessity, experimental, or a decision involving medical judgement; and internal appeal process may be required prior to external review. In addition, the Norwood-Dingell bill requires all plans to offer a "point of service" option, requires that all plans must make appropriate provisions for specialty care, including provisions for standing referrals or designation of a specialist as a Primary Care Provider (PCP) when appropriate; plans must pay claims for emergency care based on a "prudent person" standard and prohibits gag clauses; provides for coverage of clinical trials for all types of illnesses, not just cancer.
The issues regarding liability in the Norwood-Dingell Bill include: it allows health plans to be sued for actual damages, compensatory and consequential damages, and punitive damages with no cap on the amount of damages rewarded; exempts employers from liability except in the case of the employer's use of discretionary authority (this is a modification of the much broader scope of the original bill language). Further, the Norwood-Dingell bill includes non-compliance with external review that can result in civil penalties of $1,000 per day, or $500,000 for a pattern of non-compliance; plans cannot be sued if they comply with the recommendations of the external reviewer (there is a big but here); a shortcut allowing internal and external review to be bypassed if personal injury or death has already occurred (note that the definition of "personal injury" is unclear and could provide an enormous opening for frivolous lawsuits), which could prohibit the occurrence of the external review, clearing the way for litigation. After debates on many issues, the following additional provisions were also added to HR 2990: increased deductibility of health plans and long term care insurance premiums; expansion of MSA's; Association Health Plans and HealthMarts.
Members of Congress, particularly those involved in the House-Senate Conference Committee on Patients' Rights, argue the liability provisions in the bill, often within and across party lines. Rob Andrews (D-NJ), a House conferee, told the Self Insurance Institute of America on March 1 that the conference committee is "intended to be about the principal of accountability." Andrews, a former trial lawyer, stated that under the Norwood-Dingell bill that a concern is for frivolous lawsuits. He argued that "suits won't be filed" under this bill. Regarding employer liability, Andrews stated that he views the employer has "no liability" under HR 2990, "unless that employer performs an independent act of negligence." He stated that the national consensus is a strong feeling that managed care decisions are often "arbitrary and unfair." He feels that one of the "flashpoints" of the bills that are drawing attention is "the denial of access to care to a specialist is arbitrary, capricious and unreasonable." Andrews also remarked that he felt the provisions in the House bill were "too broad," and that he wants to "fix the provisions on liability."
Rodney L. Whitlock, PhD, Legislative Assistant to Charlie Norwood, (one of the authors of the Norwood-Dingell bill) however, stated that the argument is state versus federal accountability. The conferees would be concentrating on "liability and scope." He stated that "any plan can be liable" whether it's "an HMO, an insurer, an employer, a plan sponsor, an administrator, or other" party. Rodney stated that you should "assume all are at risk" and admitted that the courts would decide interpretation of the scope of definitions in the current bill. He warned that scope is indeed the key issue in this debate.
"The Norwood-Dingell bill", commented Jim Talent, a prominent member of the House-Senate Conference Committee, "…opens up liability for employers for actions arising out of decisions taken in health care networks that they have no control over, and it opens them up to unlimited liability in state court… I'm just not going to do that. If you want to increase the ranks of the uninsured by millions of people, you do that. Employers… are just going to drop it. That's an easy decision to them." Talent was a sponsor of an alternate bill that was defeated in the House, but is highly regarded in Washington, and hopes to have some of his own language from his prior bill inserted into whatever bill is sent to the president for signature.
When discussing the scope of the Norwood-Dingell bill, Nancy Johnson (R-CT), House Conferee, stated, "We have to have some way for people to escape the catastrophic level of bureaucracy that has developed in managed care. As for the Patients' Bill of Rights, the issue of scope is a very significant issue. The most controversial part of the patients' bill of rights is the right to sue… Can you protect employers from being vulnerable to sue?" Commenting on Norwood-Dingell, Ms. Johnson stated "We cannot tolerate a decade of spiraling costs as a result of writing the patients' bill of rights wrong, so there is very determined attachment by the republicans to doing this right and having a good bill. The Norwood-Dingell language, if you read it carefully, is wide open. You can sue almost anyone…you can sue for action as well as non-action. You can sue for administrative reasons. One key phrase is you can be sued for 'anything that arises out of", and if you're an employer, you do not want any law that says 'anything that arises out of.'" The Norwood-Dingell bill would, according to Ms. Johnson, "be a catastrophic event for employer-provided health care, and I feel would ultimately destroy the system. That's not going to happen…"
So what does Ms. Johnson believe will be the outcome if the bill passes? "If we put in place yet another open-ended incentive to sue, with all things that are happening out there in terms of class action suits and so forth, it will take us ten years to recover, at the very least. The impact that will have in a fast-paced, highly competitive global economy is frankly something we can't even estimate."
Senator Don Nickles (R-OK), Senate Conferee, stated to the attendees of the NAHU legislative conference on February 29 that he "will not let employers be held liable for health plan decisions." Nickles is very familiar with the issues, as the owner of his family's business, Nickles Manufacturing, a self-insured employer of approximately 300 employees. Nickles supports the employer-based health care system, and is strongly opposed to employer liability in health plans.
Misleading Data Used
So what's the big deal? The big deal is that Washington is preparing to make huge decisions with half the facts, at best. They are taking statistical data tossed about in the media with blind faith, and preparing to perhaps change the face of health care in America, without knowing the consequences. Many Members of Congress truly believe, based on government statistics, that adding liability to health plans will increase the cost of plans by only "1% to 4%" of premium, according to the numbers that have been thrown about by Congressmen and Senators during my week in Washington. Most often quoted was a report prepared by the Congressional Budget Office that estimated that adding liability to health plans would increase premiums only by 1.4% (CBO cost estimate of Senate Bill 6, June 16, 1999). And the sad thing is, many of them truly believe those numbers! Think about it for just a moment. Allowing anyone to sue for virtually anything in state courts, including punitive damages, and including frivolous lawsuits, will only drive up premiums 1.4%? Where do they get these incredibly and ridiculously low estimates? We all know that statistics can be twisted to show just about anything an interested party wants them to show. But anyone involved in health care and the insurance business knows better. I've heard and seen reports from various insurance companies and actuaries who have determined that the cost of health care could go up initially as much as 30% if plans were opened up to liability, growing to higher proportions over time. And if given unlimited liability, would employers really want to risk offering a health plan to their employees? Early indications say no way. I know my clients wouldn't. And several congressmen and their staffs have stated to me, as well as my colleagues, that they are now hearing from employers, and employers are telling them they will not, cannot afford to keep their health plans for employees if they were potentially liable for unlimited punitive damages in court. They simply cannot afford the increased premiums or risks. Premiums are already up 12% to 25% across the nation for most plans, whether covered under an HMO, PPO or point of service plan. The only relief seems to be from self-insured employers, who are seeing slightly lower renewal increases. The smaller employer is barely affording it now, and the larger ones are not about to pay for it if they don't have to. So what will they do? Many have said they will simply eliminate their group health plans. Some say they'd pay their employees a sum instead and let them buy their own plans.
SIIA's George Pantos feels that part of the problem is the analysis from government experts. "There is a lot of misinformation because of the flawed legal analysis that is taking place, where lawyers are interpreting the Norwood-Dingell bill in a way that makes it appear that there is no liability. There is an exception in the bill for employers, but then the language after that takes away the exception. They seem to minimize that by saying that it really doesn't take it away, the bill says clearly that the employers and plan sponsors are not liable. The problem really is that there is a lack of clarity of what the intention of Congress is… They say they don't want to make the employer liable, but they won't say that clearly. That creates confusion and courts will get confused, and as a result of that, lawsuits will be filed, unless the language is changed. This will create a huge intimidation component as plaintiffs go to trial attorneys and they bring legal actions against very routine, administrative decisions, coverage decisions, and that's what is going to complicate the whole problem. There is a simpler way to do it." When asked what that simpler way is, Mr. Pantos replied " Simply to say that the purpose of this bill is to bring about HMO reform, and to change the legal aspects that relate to managed care organizations, and exclude group health plans completely, and exclude employers completely, and exclude administrators completely."
A Lewin Group study recently showed that every one percent increase in cost of health care forces up to 400,000 Americans to lose their coverage, and a survey by Public Opinion Strategies showed that 57% of small employers would likely drop insurance coverage for their employees if they could be sued for medical malpractice.
According to a recently-released study by Hewitt Associates, a consulting firm, about one third of employers would drop health care coverage if they were exposed to costly litigation such as that stated in the Norwood-Dingell bill.
When asked about employer reaction to the patients' bill of rights liability provisions, Mr. Pantos commented, "What would you do, as an employer, if you were told that your business would be sued for a multi-million dollar damage claim? Would you just sit idly by, or would you take some action? What actions can be taken? Number one, a lot of employers will simply say that they are going to discontinue their plan and just give the employees a certain amount of money, and let them buy their own insurance. That undercuts self-insurance and other types of group health plans. Other employers may say that we will pass the cost of this on to employees, and cut back benefits, and of course that is not satisfactory either, as that means less coverage. The first instance creates more uncovered, and the second instance is creating under-covered. I think employers have to persuasively convince their legislators that this has very severe consequences. To this point, the employer community has not been very vocal."
It is important to note the true impact on employer-based plans that such legislation would have on the insured market. Among nonelderly Americans with health care coverage in 1998, 65% (154.8 million) had employment-based health care coverage in 1998. Seven percent of the nonelderly had other private or individually purchased health care coverage, and 14% of the nonelderly population had health care coverage through a public program. Eighteen percent of the nonelderly population was uninsured. In addition, of workers ages 18-64 with health care coverage in 1998, 73% received health care coverage through an employer in 1998. Combined nonemployment-based public sources of coverage (Medicare, Medicaid, and CHAMPUS/VA) and other private or individual health care coverage covered 12% of workers, while 18% of workers were uninsured. And, among wage and salary workers ages 18-64, 75% (81.2 million workers) were offered health care coverage by their own employer in 1997. Of the 81.2 million workers offered coverage, 67.5 million, or 83%, accepted the coverage. That means that 13.7 million people, or 17%, declined coverage offered by their employer.
The Problem of the Uninsured
What will this legislation, if passed with liability provisions for employers, do to the number of uninsureds in America? Of the 44 million Americans now uninsured, at least half of them are uninsured because they choose to be, not because they can't afford it. Statistics have shown that these uninsured could purchase but simply choose not to. They are young, healthy, and feel they probably won't need it. So why not simply buy a better car or the furniture they've been thinking about buying, or braces for their child instead?
According to Pantos, "The problem of the uninsured is that you have 44 million who don't have coverage, and the number is growing. Most of the uninsured are in the employed sector, in small companies. Approximately 80% of the people who are uninsured who are employed work for small companies. Why don't small employers provide coverage? Because they can't afford it. So, the search for a solution there is the aim of making coverage more affordable. …The problem of the uninsured will get worse if this legislation passes, because more and more people will drop coverage."
"NAHU believes," commented Janet Stokes Trautwein, NAHU Director of Federal Policy Analysis, "that too many Americans are unable to afford the cost of adequate health insurance coverage, and has been on the forefront of development of federal and state policy to address the issue of the uninsured and improve affordability for all Americans. Expanding liability for employers and health plans will not improve the quality of care for enrollees, but will cause costs to go up, pricing many out of coverage. Rising costs and exposure of health plans to liability will force many employers to reduce benefits, increase employees' contribution to their health care, or make them drop their employees' coverage altogether. This will greatly increase the ranks of the uninsured."
"Imposing liability upon employers for the wrongdoings of health plans will greatly exacerbate the problem of the uninsured," stated John J. Nelson, president of The California Association of Health Underwriters. "Many small employers will not continue to provide health benefits to their employees if they are put in a position of liability in this regard. Nor will they continue to bear the additional cost of government imposed mandates. It seems to us that certain lawmakers think the "fix" to the problems and challenges of the health care industry can be found in additional legislation. In fact, most of the problems we are experiencing today are a direct result of the "unintentional" consequences of prior governmental intervention. Lawmakers need to focus their efforts on repealing some prior legislation and refraining from involving themselves in the very sensitive business of health care. Continued legislation from Washington and the states will eventually irreparably harm our system and could potentially lead to socialized medicine for all Americans."
"If we are going to do something about the number of uninsured," stated House Conferee Nancy Johnson, "we are going to have to provide more options out there. Not only are group plans under ERISA a good option, but medical savings accounts are also important..."
Success of the Conference Committee
There is argument in Washington about whether the Conference Committee will be able to settle this issue in any reasonable way, so that a bill can be voted on in both houses before sending it on to the president for signature, far in advance of the November elections.
Speaking of the conference committee, Talent stated, "I don't anticipate an enormous amount getting done there, because I'm afraid that will be an opportunity for people to posture. At the meetings I have been at, there is a real sense of energy, and a desire to get to work on this, to get a resolution pretty completely. You have people on the conference committee who are very knowledgeable about the issues, and that is not always the case. There is a tremendous difference, and I'm convinced that it's a good faith difference, in approach between the Senate and the House at this point. The Senate has passed a much more limited bill, it's a bill that … does not include liability for HMO's, in the event that they fail to allow care that's been prescribed, on the grounds that it's not medically necessary, or it's experimental care. The bill is much more limited in scope; it only applies to people who are in self-funded plans, on the theory that they are the only plans that are now exempt from state regulation. The bills have different definitions of medical necessity. The house has important access provisions, which I am most interested in, which the Senate bill does not contain."
For the record, the House conferees consist of 20 members, of which 10 voted no on Norwood-Dingell (HR 2723, roll call 490, October 7, 1999), 9 voted yes, and one was a no-vote. No votes were recorded as Bliley, Shadegg, Archer, Thomas, Johnson, Boehner, Talent, Fletcher, Goss, and Burton. Yes votes were Bilirakis, Dingell, Pallone, Rangel, Stark, Clay, Andrews, Berry and Waxman. The only no vote conferee was Scarborough. So, do not anticipate an easy battle. This will be very close, no matter which way it ends up.
Supporters of the Norwood-Dingell bill include The American Medical Association, The American Dental Association, The College of OB/GYN's, and The Trial Lawyers Association. Opponents of the bill include The Self Insurance Institute of America, The National Association of Health Underwriters, The Health Insurance Association of America, The American Association of Health Plans, and several Chambers of Commerce.
Alternative Solutions to the Problems
There are as many solution alternatives to the problem as there are politicians in Washington. I've heard the arguments from every side of the aisle, and some were frightening. While visiting a neighboring Orange County Member's office, Cheryl Jaeger, Legislative Assistant to Chris Cox (R-CA), informed me that Congressman Cox's solution to the problems in the health care industry is more competition and greater employee choice. It sounded good for the first twenty seconds of the conversation. However, as she began to explain the Congressman's ideas, I once again had that feeling of anxiety and fear for my clients. Cox believes in offering more competition, but making employee choice a key component to health plan selection, and allowing individual employees of companies formerly covered by group health plans to opt out of their group plans and instead enroll in any individual plan of their choice. I tried to explain about the problems in the individual market, and how adverse selection would be a problem with carriers, and talked about the success of the employer based health care system. The misinformation I was given was astounding. This congressman's staff had absolutely no idea of the realities of the marketplace. And given that I had previously met with Congressman Cox in his Orange County and DC offices many times in the past, and believed him to be a fair and staunch supporter of the employer based health care system and of a highly competitive group marketplace, I was shocked at his ideas for health care reform.
Jim Talent has other ideas for the solution to the problems in the marketplace. He believes in external review, and in the employer-based health care system. Talent favors the offering of association health plans under ERISA regulation. In fact, he said that it is the one area of the bill where he has "drawn a line in the sand." He feels they would allow guaranteed issue programs to association members under one set of national regulations. "Conservatively speaking, they can offer plans at 10 to 20% less" to members than small businesses can now get. "The only people opposing this bill are the people who do not want the private health market system to succeed, because they want a single payor system…or [certain carriers] are against it because they are going to lose business."
Talent believes small employers are faced with adverse selection and unfair underwriting practices in the states. "There are millions of people who wouldn't be in this position if we passed this bill. There are these games being played up here over this, and it makes me mad when they do that, because you're really hurting people [who can't get coverage elsewhere or it's unaffordable]. Lots of stuff we do up here doesn't matter to anybody. This matters! This part of the bill…is coming out over my dead or broken body."
The Self Insurance Institute of America supports such Association Health Plan (AHP) legislation, as it supports ERISA regulation and assists smaller employers with or without multi-state employees to compete in the larger group marketplace. However, NAHU does not, and offers a tax credit solution to solve the problems addressed by Congress, and has offered their own "Real Choice" tax credit proposal, which keeps the employer in the mix.
Congresswoman Nancy Johnson also suggested the possible option of a tax credit. Full deductibility, she feels, is key. "That seems to be not too controversial. The Senate is for it, the House is for it, and now the president is saying he wouldn't have too much trouble signing that kind of tax relief." She continued, "we've got to find a way for small businesses to group under ERISA," stated Johnson, "because it is their only protection from state mandates. That's what motivates us. There is very clear evidence that state mandates do drive costs up. From businesses standpoint, more and more small businesses are now multi-state, even if they only have 50 employees. The republicans are very dedicated to this issue."
Whatever the outcome, I hope, for the sake of my clients, that reform comes in the form of external review, and that liability provisions will not include employer liability of any type. Let's hope the lawmakers soon forget the politics and do what's best for the American people!
Editor's Note: This article was edited from its original version for the purpose of this publication. Views stated are the opinion of the author and not necessarily those of the California Association of Health Underwriters
"Concerned About Patients' Rights? Don't Blame ERISA!" James A. Kinder, Self Insurance Institute of America.
FACTS From EBRI, "Employment-Based Health Care Benefits and Self-Funded Employment-Based Plans: An Overview," February, 2000, Employee Benefit Research Institute.
Hey, Wait a Minute, "The Issue - Liability of Health Plans", Volume 2, Issue 7, July, 1999, National Association of Health Underwriters.
HBC National Summary, Public Opinion Strategies, February 10, 2000
AAHP Report, "Health Plan Liability: What You Need to Know", January, 2000.
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