SIIA Legislative Alert: Stop- Loss Insurance Legislation Introduced in U.S. House
Industry News
Thursday, May 11 2023
April 25, 2023 – Earlier today, the Self-Insurance Protection Act (SIPA), H.R. 2813, was re-introduced in the U.S. House of Representatives by Rep. Bob Good (R-VA), chair of the Education & Workforce Health Subcommittee. The Subcommittee will be holding a legislative hearing examining H.R. 2813, in addition to several other healthcare-related items, on Wednesday, April 26th.
Initially drafted by the Self-Insurance Institute of America, Inc. (SIIA) nearly a decade ago, the Self-Insurance Protection Act clarifies existing law to preserve choice when it comes to offering self-funded health benefits to workers, and to ensure that self-insured group health plans can access stop-loss insurance to protect against catastrophic risk. Nationwide, nearly 60% of consumers receiving health benefit coverage through private-sector plans are covered under a self-insured group health plan.
Blue Shield is adding the Access + full HMO Network, Bronze Trio, and their two most popular HSA plans to the CCSB portfolio.
The legislation would also pre-empt State laws that prevent self-insured group health plans from “insuring against the risk of excess or unexpected health plan claims losses.” The addition of this pre-emption provision is particularly important in strengthening the foundation of ERISA, as a number of State proposals continue to be introduced that seek to regulate stop-loss insurance, which SIIA has and will continue to fervently oppose.
Unlike health insurance, stop-loss insurance does not cover individual participants, nor does stop-loss insurance pay health care providers directly. Rather, stop-loss insurance is utilized by private- and public-sector employers with self-insured plans, along with self-insured Taft-Hartley Plans, to provide a financial backstop to reimburse the employer or the plan for catastrophic losses and to protect the plan and plan sponsor from financial insolvency. This is the hallmark of stop-loss insurance, and this is the quintessential feature that distinguishes stop-loss insurance from health insurance.
SIPA was last passed by the U.S. House in 2017 by a bipartisan vote of 400 –16. Although SIPA was never acted on by the U.S. Senate, it continues to serve as a legislative marker to ensure that self-insured plans have access to affordable and ongoing stop-loss insurance coverage.
As the health insurance market continues to evolve, and as policymakers remain focused on reforming the health care delivery system, Congress must act now to ensure that stop-loss insurance coverage is duly and appropriately protected for consumers across the country, and that small- and medium-sized American businesses are able to continue to access to stop-loss in order to provide affordable health coverage options.
SIIA is a national trade association dedicated to protecting and promoting the business interests of companies involved in the self-insurance industry, including sponsors of self-insured health plans, third-party administrators, stop-loss insurance carriers, employers, and other participants. If you have questions about self-insurance, or the Self-Insurance Protection Act specifically, please contact Ryan Work, SIIA senior vice president of government relations, at rwork@siia.org.
Initially drafted by the Self-Insurance Institute of America, Inc. (SIIA) nearly a decade ago, the Self-Insurance Protection Act clarifies existing law to preserve choice when it comes to offering self-funded health benefits to workers, and to ensure that self-insured group health plans can access stop-loss insurance to protect against catastrophic risk. Nationwide, nearly 60% of consumers receiving health benefit coverage through private-sector plans are covered under a self-insured group health plan.
Blue Shield is adding the Access + full HMO Network, Bronze Trio, and their two most popular HSA plans to the CCSB portfolio.
The legislation would also pre-empt State laws that prevent self-insured group health plans from “insuring against the risk of excess or unexpected health plan claims losses.” The addition of this pre-emption provision is particularly important in strengthening the foundation of ERISA, as a number of State proposals continue to be introduced that seek to regulate stop-loss insurance, which SIIA has and will continue to fervently oppose.
Unlike health insurance, stop-loss insurance does not cover individual participants, nor does stop-loss insurance pay health care providers directly. Rather, stop-loss insurance is utilized by private- and public-sector employers with self-insured plans, along with self-insured Taft-Hartley Plans, to provide a financial backstop to reimburse the employer or the plan for catastrophic losses and to protect the plan and plan sponsor from financial insolvency. This is the hallmark of stop-loss insurance, and this is the quintessential feature that distinguishes stop-loss insurance from health insurance.
SIPA was last passed by the U.S. House in 2017 by a bipartisan vote of 400 –16. Although SIPA was never acted on by the U.S. Senate, it continues to serve as a legislative marker to ensure that self-insured plans have access to affordable and ongoing stop-loss insurance coverage.
As the health insurance market continues to evolve, and as policymakers remain focused on reforming the health care delivery system, Congress must act now to ensure that stop-loss insurance coverage is duly and appropriately protected for consumers across the country, and that small- and medium-sized American businesses are able to continue to access to stop-loss in order to provide affordable health coverage options.
SIIA is a national trade association dedicated to protecting and promoting the business interests of companies involved in the self-insurance industry, including sponsors of self-insured health plans, third-party administrators, stop-loss insurance carriers, employers, and other participants. If you have questions about self-insurance, or the Self-Insurance Protection Act specifically, please contact Ryan Work, SIIA senior vice president of government relations, at rwork@siia.org.