Friday, September 13, 2013
Self-Funded
Health Plans Threatened with Extinction
Today
a record 61% of covered workers are in a self-insured plan, according to a Kaiser
Family Foundation 2013 Survey, up from
49% in 2000.
“The
Attack on Self-Insurance, “ Wall Street
Journal, September 13, 2013
The Obama administration and its allies are vowing
to close the self-insurance “loophole,” the “loophole” in this case being
health plans not subject to Obamacare mandates and penalties.
Under the self-funded model and the 1974 Erisa law,
businesses and many unions bypass commercial plans and pay directly for medical claims of
workers. Self-funding isolates companies from
federal and state mandates and lowers health benefit costs for businesses and
premiums for workers. State mandates,
which number in the 100s for such things as chiropractic care, acupuncture, and
contraceptives, sharply drive up costs.
Large businesses have known this for a long
time. Now small businesses with 199 or fewer workers are getting into
self-funding. In a 2012 study , the Urban Institute found ObamaCare incentives will cause 60% or
more of small firms planning to introduce self-insurance model.
The Obama administration and its ideological allies
do not like this trend. They fear this
self-funding shift will cause an insurance premium “death spiral.” They worry that self-funding small businesses
will drive up premiums for the rest of Americans, particularly the middle class, making Obamacare unaffordable.
Consequently,
Obama officials and representatives are working with state legislators
to outlaw self-funding and stop-gap health insurance policies. This policies are beyond federal government
control, which does not set well with Obama followers. Apparently the campaign promises that” If you like your
health plan you can keep it” does not apply to the 61% of workers in
self-funded plans.
Tweet: Obama administration
may try to outlaw self-funded health plans, which now cover 61%
of workers, including many union members.
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