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Protecting Affordable Health Care for Workers and Families

Affordable health care continues to be a top concern for families and small business owners. For employers, popular options like self-insurance are essential to providing workers access to high-quality care at an affordable cost.

In fact, more than 60 percent of employers offering health care coverage are self-insured. With this option, employers pay their employees’ medical expenses directly instead of purchasing a one-size-fits-all plan from an insurance company.

As a result, they have greater flexibility to customize affordable benefits in a way that meets the needs of their employees. Self-insurance is widely embraced not just by private-sector employers, but by labor unions, schools, cities, and counties around the country.

During a 2014 hearing, Wes Kelley, executive director of the Columbia Power & Water Systems in Tennessee, explained how their self-insured plan has become essential to their employees:

Over the past 22 years, our self-funded arrangement has allowed the utility to maintain above average benefits for our employees, dependents, and eligible retirees… These benefits are provided without the employees contributing to the cost of health insurance through their paycheck or otherwise. Furthermore, eligible early retirees and their dependents enjoy the same benefits as active employees.

You’re probably asking yourself, “Okay, sounds great. What’s the problem?”

Here is the problem: In recent years, some in Washington have threatened the stability of self-insured plans. In February 2013, the New York Times reported that the Obama administration was considering the idea of regulating stop-loss insurance, which often serves as a financial backstop to self-insured health plans. According to the Gray Lady:

The Obama administration is investigating the use of stop-loss insurance by employers with healthier employees, and officials said they were considering regulations to discourage small and midsize employers from using such arrangements to circumvent the new health care law.

There you have it: To protect Obamacare, the Obama administration wanted to restrict access to a health insurance model enjoyed by tens of millions of Americans.

That’s why Rep. Phil Roe (R-TN) introduced the Self-Insurance Protection Act (H.R. 1304), a bill that would prevent any future administration from limiting access to this popular, affordable health care option. As one coalition representing members of various franchise, contracting, and manufacturing industries wrote in a letter to Congress:

Today, nearly 100 million Americans receive health benefits through various forms of self-insured plans. Self-insurance is one segment of the market that works particularly well for both plan sponsors and plan participants. We believe it is necessary to act to preserve choice when it comes to offering health benefits to workers, and to prevent arbitrary limitations placed on self-insured group health plans through the regulation of stop-loss insurance.

The Self-Insurance Protection Act would do just that by:

  • Reaffirming long-standing policies. Stop-loss insurance is not health insurance, and it has never been considered health insurance under federal law. H.R. 1304 would reaffirm this long-standing policy.
  • Protecting access to affordable health care coverage. By preserving self-insurance, workers and employers will continue to benefit from a health care plan model that has proven to lower costs and provide greater flexibility.
  • Preventing bureaucratic overreach. Clarifying that regulators cannot redefine stop-loss insurance would prevent future administrations from limiting a popular health care option for workers and employers.

Preventing federal regulators from limiting self-insured plans is just one step we can take to promote more choices in health care and ensure America’s workers have access to the affordable health care coverage they need.

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