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Self-Insurance Institute of America Appeals Michigan Case Allowing State Tax on Health Plan Claims Even When ERISA Applies

"The Self-Insurance Institute of America Inc. is appealing a federal court ruling that said [ERISA] did not pre-empt a 2011 Michigan law imposing a 1% tax on paid health care claims.... U.S. District Court Judge Abele Cook of the Eastern District Court of Michigan disagreed. The Michigan law 'does not mandate any particular benefit structure or bind administrators to certain benefit structures,' he wrote[.]"

Self-Insured Group Health Plans: Stop-Loss Insurance and Adverse Selection (PDF)

Published October 4, 2011. 'In the course of considering changes to its Stop-Loss Model Act, the National Association of Insurance Commissioners (NAIC) has received formal comments containing substantive inaccuracies regarding self-insured group health plans, stop-loss insurance, and how smaller self-insured group health plans may contribute to adverse selection in the health insurance marketplace. Similar comments have beenmade by federal regulators responsible for implementing the Affordable Care Act (ACA). This White Paper identifies and corrects several inaccurate comments in order to assist policy-makers at both the state and federal level to properly assess legislative/regulatory proposals related to self-insured group health plans.

Federal District Court Finds Michigan Tax as Applied to Self-Insured Health Plan Claims Is Not Preempted by ERISA (PDF)

"The [Michigan Health Insurance Claims Assessment Act] imposes an assessment of 1% on the value of all claims paid by every carrier or third party administrator for medical services that are rendered in Michigan to a resident of Michigan.... As defined in the Act, the word 'carrier' includes, inter alia, certain 'group health plan sponsor[s].... [This Court] concludes that the Act does not have an impermissible 'connection with' an ERISA plan. Because the Court has already concluded that the Act does not impermissibly 'refer to' an ERISA plan, it does not 'relate to' ERISA under either prong of the preemption analysis and is therefore not preempted under [ERISA section] 514(a)." [Self-Insurance Institute of America, Inc. v. Snyder, No. 11-15602 (E.D. Mich., Sept. 7, 2012)]

District Court Judge Says Michigan Health Care Claims Tax on Self-Insured Plans Not Pre-Empted by ERISA

"The Self-Insurance Institute of America Inc. challenged the law, arguing that it is barred by a provision in ERISA that pre-empts state and local laws and rules that relate to employee benefit plans. But U.S. District Court Judge Julian Abele Cook of the Eastern District of Michigan disagreed. The Michigan law 'does not mandate any particular benefit structure or bind administrators to certain benefit structures,' he wrote ... In addition, the law 'does not act exclusively on ERISA plans or single them out for different treatment but rather treats them the same as other entities' that make payments to health care providers, Judge Cook wrote."

Sixth Circuit Must Rethink Whether ERISA Preempts Michigan Health Insurance Tax Law

"The U.S. Supreme Court has vacated a federal appellate panel's holding that a Michigan law designed to generate revenue to pay the state's Medicaid obligations was not preempted by ERISA. The High Court granted a petition filed by the Self Insurance Institute of America, Inc. (SIIA) and remanded the case to the U.S. Court of Appeals for the Sixth Circuit for further consideration in light of the Supreme Court's recent opinion in Gobeille v. Liberty Mutual Insurance Co." [Self-Insurance Inst. of America v. Snyder, No. 12-2264 (6th Cir. Aug. 4, 2014; cert. granted Mar. 7, 2016)]

Comment Letter by the ERISA Working Group of the National Association of Insurance Commissioners, to NAIC ERISA Working Group on Draft Guideline Amendments to the Stop Loss Insurance Model Act (PDF)

Comments on proposed updates to stop loss model provisions and their effect on self-insurance, particularly for small employers, in light of ACA requirements, submitted by AHIP; Blue Cross Blue Shield; Chambers of Commerce from Illinois, Pennsylvania, Texas and California; Cigna; Protect Health Care Choice Coalition; The Council of Insurance Agents & Brokers; HCC Life Insurance Company; Self-Insurance Institute of America, Inc.; American Insurance Association; and consumer representatives.

White House Suggestions on Funding Contraception Coverage 'Unworkable'

" 'The notice demonstrates the administration's general lack of understanding of how self-insured group health plans operate and, more specifically, the role of third-party administrators,' according to a statement by [the Self Insurance Institute of America Inc. Chief Operating Officer]."