State Single Payer Amendments & ERISA

SUPREME COURT DECLINES TO CHALLENGE SAN FRANCISCO HEALTH PLAN
DING DONG ERISA’S DEAD (for now)

On June 28, 2010, the Supreme Court declined to hear the challenge by the Golden Gate Restaurant Association (GGRA) against the San Francisco Health plan. Download the BRIEF FOR THE UNITED STATES AS AMICUS CURIAE by the Depts. of Labor and Justice of May, 2010. Commentary coming soon.

Click here to download the Administration’s brief opposing the GGRA’s challenge

State Single Payer Waivers in HR 3590

Ellen R. Shaffer, PhD MPH

Single payer advocates sought provisions in the national health reform bill that would facilitate the implementation of single payer legislation at the state level.  The preferred language was not included, and the provisions that were adopted place certain new roadblocks in the way.  This memo notes what the single payer states wanted, what they got, and options for moving forward.

What Single Payer State Advocates Wanted

  1. Affirmative assistance: Folding in current funding for federal health programs like Medicare, and new federal dollars for the exchanges, into the new state single payer system.
  2. Defensive assistance: Protection from ERISA (Employee Retirement Income Security Act) provisions that have been the basis for lawsuits against a wide range of state proposals to expand coverage for health care.  ERISA preempts states from legislating on matters related to employee benefits, and reserves that right to the federal government. (See our memo on ERISA .)

What the Bill Does

HR 3590 as adopted would automatically transfer federal premium subsidies to single payer states, but further work is needed to coordinate with Medicare, Medicaid, and most other federal health care programs.  States will need to assure that the dates relating to health exchanges do not delay implementation of state single payer programs.

What States Can Do: Policy and Politics

Click here to download Memo on State Single Payer Waivers

Pre-Empting ERISA: Legislating for a State Single Payer Plan    Briefing Paper by the Center for Policy Analysis

ERISA: The law. Relevant court decisions

Maximizing ERISA-proof provisions in a state single payer bill

Click here to download ERISA Briefing Paper
Kucinich Amendment Sought to Grant ERISA Waiver for Single Payer States.

Sanders Senate Amendment Expands Support for Single Payer States

The Center for Policy Analysis worked closely with Congressional staff to craft the two amendments to health reform legislation that offer the greatest prospects for single payer supporters.

Summary

Some state and local governments that have attempted to expand health care coverage have been successfully challenged in court by employers under the terms of the Employee Retirement Income Security Act of 1974 (ERISA). ERISA pre-empts states from enacting legislation if it is “related to” employee benefit plans. It reserves that right to the federal government.  Section 514 of ERISA states that Title V (Administration and Enforcement) and Title IV (Fiduciary Responsibility) of ERISA “shall supercede any and all State laws insofar as they may… relate to any employee benefit plan.”  There is no provision for an administrative waiver of these rules.

The Kucinich amendment to HR 3200, approved by a recorded vote of the House Education and Labor Committee, would have removed this barrier for states that have enacted and signed into law a single payer system.

What the Amendment Proposed

The Secretary of Labor, in consultation with the Secretary of Health and Human Services, would be authorized and required to waive the ERISA pre-emption (Sec. 514) for states that have enacted a state single payer system. In this case, the Secretary could decline to grant the waiver only under extraordinary circumstances. The system would have to meet requirements, and the Secretary could revoke the waiver if it fails to do so.

The state single payer system is defined as a non-profit program of the state for providing health care to all residents.  A single state agency would finance and administer the provision of comprehensive benefits that meet or exceed the standards for coverage and quality described in HR 3200, and assure free choice of health care providers. Private insurance that duplicates this coverage would be prohibited.  Health maintenance organizations could operate on a non-profit basis if they also own their facilities and provide services directly. The system would not result in greater costs to the federal government.  At the same time, the federal government would maintain the equivalent level of support as provided to other states, accounting for variations such as population and demographics.  States could seek planning and start-up funds.

Different Advantages of the Sanders Amendment

A different state single payer amendment was proposed by Senator Sanders, and is included in the new law. It does not include an ERISA amendment.  It does include some more detailed provisions that cover matters that are beyond the jurisdiction of the House Education and Labor Committee.  These include: Dedicated funding for planning and implementation grants; Specific allocations of funds from existing federal health programs such as Medicare and Medicaid, and waivers to permit coordination with those programs; Quality assurance and health professional training programs associated with other federal programs.

Click here to download Kucinich ERISA waiver

Click here to download Sanders amendment

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3 Responses to State Single Payer Amendments & ERISA

  1. Pingback: The Amazing Maze of US Health Care » Blog Archive » PPACA Raises Barriers to State Single Payer Efforts

    • ellenshaffer says:

      Let’s see. Before the ACA passed, states were completely hamstrung by ERISA. The ACA allows states to circumvent ERISA’s preemption rule, as of 2017. Sounds like this is an improvement. Advocates do need to fight for an earlier timeline. – Ellen Shaffer

  2. ellenshaffer says:

    Not sure I understand your comment