State Employer Mandate Laws and ERISA

http://www.ama-assn.org/amednews/2008/04/07/gvsa0407.htm is an article addressing rules regarding mandates, state laws, that make employers responsible for providing health care coverage for employees or putting money aside for an uninsured fund.

Naturally, employers are against it. It's an interesting aspect of the shared responsibility for health care costs idea.

As stakeholders, where do consumers stand? Consumers stand against the rising cost of health insurance, since employers usually have greater negotiating power with insurance companies than mere individuals, it makes sense that consumer advocacy should promote employer responsibility for offering their employees some kind of effective health insurance coverage. But many companies attacked the benefits of the lowest wage earners in their organizations through the implementation of more part time jobs, typically not covered by benefits. Most larger employers now encourage workers to "shop around" for their own health benefits.

Consumers should not panic at any of the greed motivated fingerpointing going on among other stakeholders in the health industry. Like the article points out, the AMA also has not taken a strong stance regarding state law mandates that employers should contribute to cost of health insurance, it's a fight a little more removed from their advocacy of insurance as a means of getting paid, rather than defining who pays for that insurance. For consumers, it's nice to see some mandates coming down from governments on corporations at all.

The long and short of it is that right now nobody wants to pay for health insurance and the cost of medical care is so high that it requires some reliable form of help for consumers who need to pay for medical care. While companies look to ERISA for help (which does not support additional laws from states forcing companies to finance health insurance costs,) ERISA has also blocked many lawsuits against insurers because of the favorable treatment employer-sponsored insurance has been given in the past.

No mandates means that the multi-stakeholder approach of consumer, employer, medical services provider, and insurer will all be pursuing their own goals independently. For consumers this means that making the best deal will also include getting copies of your documentation and highlighting portions of your plan that you believe cover you for a specific event. In the event such coverage does not exist, consumers will no longer be barred from individual lawsuits, including those in small claims court for breach of contract, or fraud. Consumers will also finally put direct pressure on medical services providers to contain their costs. And employers? Who cares. In days where corporate deals leave the majority of employees making marginal salaries, and the top positions pay multi-millions for even the worst performance, perhaps employers have made themselves obsolete as tools for consumers seeking decent health insurance coverage.