The Self-Insurance Insurance Institute of America Inc. (SIIA) is blasting allegations by federal regulators and others who contend that employer flight to the self-insured market could leave insured plans stuck with the sickest employees.
The Patient Protection and Affordable Care Act of 2010 (PPACA) exempts self-funded employers from most of the provisions that apply to insured health plans. The large and midsize employers that offer self-insured plans will have to provide coverage for employees or pay a penalty, but the self-insured plan sponsors will not be subject to the PPACA essential benefits package requirements or the new requirement that insurers offer several specific levels of coverage.
The stop-loss carriers that reinsure the self-funded plans to not have to abide by the new PPACA fee-increase justification requirements, and self-insured plans also will also be exempt from a new tax that PPACA is set to impose on health insurers.
Timothy Stoltzfus Jost, a law professor who represents consumers in proceedings at the National Association of Insurance Commissioners, Kansas City, Mo., is one of a number of commenters who have written to the NAIC, for example, to suggest that stop-loss carriers have always lured healthy groups away from insurers and now will have an increased incentive to do so.
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Others are submitting similar comment letters to the federal regulators implementing PPACA and to members of Congress.
The SIIA, Simpsonville, S.C., says the commenters are giving an inaccurate impression of how self-insured plans work.