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Official: ERISA Hurts Efforts To Help Uninsured

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Federal laws are hampering state attempts to reduce the number of people who lack health coverage, according to Kansas Insurance commissioner Sandy Praeger.

The Employee Retirement Income Security Act keeps states from collecting data from self-insured employers, and states cannot involved the self-insured employers in any new state programs, Praeger said here at a meeting organization by the National Association of Health Underwriters, Arlington, Va.

“Any of the things we would like to try at the state level, we are pre-empted by ERISA,” Praeger said.

Praeger is the president elect of the National Association of Insurance Commissioners, Kansas City, Mo.

The NAIC recently surveyed its members to determine how much of a problem preemption is.

Participants reported about 20 different areas in which ERISA had impeded state efforts, Praeger said.

Ohio, for example, reported that it had to depend on a nonprofit group to get data concerning self-insured entities, and Vermont expects to have trouble enforcing a new law that would permit it to get claims data from any health insurer, including a self-insured employer plan, Praeger said.

But members of Congress seem open to the idea of easing the preemptions, Praeger said.

“There is a real interest in Congress for greater flexibility in the states,” Praeger said.

Other speakers at the conference argued that states do need to be watched when it comes to health care programs.

During a panel discussion, House Energy and Commerce Committee staffer Ryan Long said that while Republicans in the House support continuing the State Child Health insurance Program, or SCHIP, as a block grant program in which funds are managed by the states, some questions have arisen regarding states that have expanded the scope of the program.

Some state have begun to allow childless adults to receive benefits through SCHIP, or have created exclusions for some income that effectively increases the eligibility threshold beyond the intended 200% of poverty level, Long said.

Some of these states are facing shortfalls in federal funding for the SCHIP program.

Increasing the number of eligible adults aggravates underlying problems with the formula for allocating SCHIP funds to the states, Long said.

“If you can’t cover the kids you’re supposed to cover, then don’t expand your coverage to childless adults,” Long said.