Looks like you will not be able to keep all of your health plan options


Many employers have worked hard to control health care costs and despite the claims of Safeway have been largely unsuccessful.  In many cases part of that strategy is to offer several options to employees, often including high deductible health plans with or without a Health Savings Account. 

Those options are likely to go away under the health care reform legislation. As currently planned in the House version of reform, employers would not be permitted to offer a plan, even as an option, that does not meet the minimum requirements of the government standard.  It appears (although not certain) that the comparison will be on an equivalent actuarial basis, but it may be on a specific plan provision basis.  So, let’s say your company offers an HMO, a POS and a high deductible plan.  Unless there is a significant employer contribution to an HSA if one accompanies that option, it is unlikely an option with a high deductible will be permitted.  In other words, any health plan offered by an employer must equal or exceed in value the final version of a government essential benefits plan. 

uncle sam pointingSome employees select a lower value option to save premium dollars, others because they have also has coverage through a spouse’s employer plan, but this could all go away.  Clearly if this provision in the House version of legislation prevails some people will not be able to keep their current coverage even if they like it and it meets their needs. 

On another topic some employers are concerned that health reform will negatively impact ERISA pre-emption.  This comes from a provision that states the ERISA pre-emption is waived if a state enacts a single payer system.  However, in recent discussions with legislative aides drafting this legislation I was assured that there is no intent to tamper with ERISA pre-emption and it appeared the importance of pre-emption was understood?  In addition, there is a reasonable possibility that the current language related to single payer state plans will be eliminated.

While the time frame is still relatively short, we are still a long way from a final version of health care reform.  It appears now that the Senate Finance Committee is the key to getting the most reasonable version for employers.  At this point staffers are waiting to see what the Finance Committee releases.

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