Self-insurance and the contraception mandate
The question of how to reconcile “self-insured” religious institutions with the contraception coverage mandate has been something of an adjunct to the entire brouhaha, but it is a difficult problem and may emerge as a real stumbling block.
A New York Times business story today explores and explains the issue very well:
Employers that self-insure provide health insurance directly to employees, paying the health care claims of their workers. Large employers often choose to self-insure because they can spread the risk across hundreds or thousands of workers. The option is often more economical and can allow an organization to tailor its plan to the specific needs of its employees. Many such employers contract with an insurance company to administer the plan.
Nationwide, 60 percent of workers with health insurance were covered by a self-funded plan in 2011, according to the Kaiser Family Foundation’s annual survey of employer health benefits. Among large employers, the number is even higher. Eighty-two percent of covered workers at companies of more than 200 employees had self-funded plans.
Insurance industry experts and Catholic groups said they did not know how many religiously affiliated organizations self-insure, but they said the number was likely to mirror the national trend. Many of the organizations are large employers, including hospital systems and universities.
One proposal I’ve heard would be to grandfather in self-insured religious organizations. That doesn’t sound very satisfying, or just, if you are a granddaughter organization. Exempting self-insured religious institutions entirely might work, and actually be a back door into the kind of de facto religious exemption the bishops wanted.
Those with actual knowledge of these topics are invited to comment…
Tags: contraception, HHS
“One proposal I’ve heard would be to grandfather in self-insured religious organizations. That doesn’t sound very satisfying, or just, if you are a granddaughter organization. Exempting self-insured religious institutions entirely might work, and actually be a back door into the kind of de facto religious exemption the bishops wanted.”
David G – what would “grandfather in” mean in this instance? Under the new mandate, aren’t the existing choices:
(1) Company-sponsored health plan offers contraception at no charge to its employees;
(2) Religious organizations (as defined by HHS) are exempt from this requirement – but that definition excludes universities, hospitals and social service agencies;
(3) The accommodation has added a special third category for universities/hospitals/social service agencies: their obligation under (1) is transferred to their insurer
So would “grandfathered in” mean that self-insured religious organization are to be categorized as (2)?
Jim, sorry I wasn’t clearer — from what I understand, they could exempt religious institutions that are currently self-insured, but those that are established later or try to switch from commercial insurers to self-insurance would not be exempt. But again, there are many variations on this theme, I’m sure.
One proposal to the entire problem that would respect everyone’s freedom would be for religious employers to pay a certain sum into a health savings account, which the employee could use to buy whatever contraceptives he or she wants or other health-related expenses. Or, instead of paying that sum into a dedicated account, the employer simply includes those funds in the employee’s regular paycheck.
Not only does that respect everyone’s freedoms, including the freedom of women to obtain contraception, but it also respects and treats women as adults who can make contraceptive decisions on their own in privacy, and not treating women as children who need some paternalistic insurer or employer to pay for them, especially when it is none of their business.
All plans (commercial or self-insured) that were in existence on March 23, 2010 are already grandfathered. They have had to adjust to meet some new requirements, but “preventative services”, which is where contraception comes in, is not one of them.
preventative services = prevention services
I suppose that one solution would be to move the grandfathered date for self- insured plans up to February 10, 2012 or some other date.
Those with actual knowledge of these topics are invited to comment…
I’m out.
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I’m not sure that the self insured issue really matters, because the insurance is part of the wage due the employee. It seems to me that it’s her money, not her employers money, and that the conscience issue is hers, not that of her boss.
Benders proposal above seems to clarify that reality.
God Bless
Btw – regarding the mandate and how it came about – here is a background article on the agency of the federal government that cooked it up.
http://online.wsj.com/article/SB10001424052970204795304577220950656734864.html?mod=WSJ_Opinion_LEADTop
I’m honestly surprised: I thought the point of the Affordable Care Act was to ensure that those without health insurance would have coverage. This rather sinister-sounding board has far more sweeping powers.
Jim (7:18 pm), thanks for that link. It looks as though the contraceptives mandate is just the tip of a black hole that was deliberately planted into the ACA. More to come, the author says, and worse.
I’m beginning to have the uneasy feeling about Obama that an essential part of his modus operandi is trying to get his programs into law in a very undemocratic and deceptive fashion. Both this feature of the ACA and the way he misled Dolan and, apparently, even Keehan, fit that pattern. As does, come to think of it, the way his attorney general pushed the Hosanna Tabor suit in spite of, no doubt, knowing that it was unconstitutional. A former Obama supporter at NCR recently wrote that he no longer understood the man. I’m beginning to think we’re all about to understand him far too well.
Switching tracks, why is no one any longer pushing the Hawaii solution to this mess? A conscience exemption along those lines seems to me much simpler and honest than the twisted stuff in law and on the table now.
Jim P. ==
Assuming that the data in that article is factual (and I don’t doubt it), all that article establishes is that given the costs of medical care in the present system we cannot afford the best medical care for everyone. Americans simply are not willing to pay that much for healthcare for all. And maybe we can’t afford it using the present system.
Of course, if the super-conservatives didn’t go into their terminal state of fear and trembling whenever they hear the word “socialism” uttered, we might have some rational discussions and do something rational like having a first-rate single-payer system which we could afford. (Just think of it == then newborns would have as good a chance at surviving as they do in Communist Cuba!) (Sorry, Bender and Mark, but sometimes those words have to be uttered.)
This thought has occurred to me, which may be obvious, but I had not really thought of it before.
Certainly providing insurance with contraceptive coverage in it is not wrong in and of itself. There would be no issue at all if, say, all women employees were past childbearing age.
And certainly purchasing contraceptives drugs with the aid of insurance is not wrong in and of itself. We know that about 15% of prescriptions for oral contraceptives are actually written to treat various medical conditions. And the Church does not object to that.
And certainly merely taking a contraceptive drug is not wrong in and of itself, for the reason mentioned above.
So if the employer who provides insurance for contraceptives is cooperating with evil, it can only be at the moment an employee is engaging in sex in which contraception is being used with the intention of preventing pregnancy.
So to anyone out there who has contraceptive coverage through a Catholic organization, remember if you have sex with your spouse using contraception, the two of you are not alone in the bedroom. The head of your organization, maybe even a bishop, is in some sense present in the room cooperating with your evil.
[...] Self-insurance and the contraception mandate Self-insurance as well as a contraception mandate Employers which self-insure yield illness word without delay to employees, profitable a illness caring claims of their workers. Large employers mostly select to self-insure since they can widespread a risk opposite hundreds or thousands of workers. Read some-more upon Commonweal (blog) [...]
Btw – regarding the mandate and how it came about – here is a background article on the agency of the federal government that cooked it up.
–Jim Pauwels,
My experience has been that when someone writes an op-ed piece and calls the Affordable Care Act “Obamacare”, he probably doesn’t like it and it may not be objective.
The list of “Women’s Preventative Services” was developed through HRSA, the Health Resources and
Services Administration.
You can read about it here: http://www.hrsa.gov/womensguidelines/
Note that grandfathered plans (those existing on March 23, 2010) are not required to provide these services.
John Hayes —
When the op-ed author is a Resident Fellow at the American Enterprise Institute, your suspicion is probably correct.
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“The list of “Women’s Preventative Services” was developed through HRSA, the Health Resources and Services Administration.”
I spent some time last night trying to piece together how the process works among these different agencies, and I confess I’m befuddled. It may be something like this: OIM (an independent body) was commissioned by HRSA to make recommendations; USPSTF (another independent body) grades their recommendations on a scale of A-D; and HRSA (an agency of HHS) promulgates the policy based on the recommendations and grades.
“My experience has been that when someone writes an op-ed piece and calls the Affordable Care Act “Obamacare”, he probably doesn’t like it and it may not be objective.”
The same skepticism applies to a website owned by a governmental agency, such as HRSA, whose chain of command runs up through political appointments and elected officials. And, some folks would add, given that this is a Democratic administration, doubly so :-)
Ultimately, the content stands or falls on its own merits.
“So to anyone out there who has contraceptive coverage through a Catholic organization, remember if you have sex with your spouse using contraception, the two of you are not alone in the bedroom. The head of your organization, maybe even a bishop, is in some sense present in the room cooperating with your evil.”
Well, if you would give him his wallet back and quit insisting he pay for your contraception he would be happy to leave. In fact, he would much prefer to.
Back to the question of the self-insured – HHS Secretary Sebelius provided this “clarification” to reporters on Wednesday (the Times story missed it, oddly):
“Secretary of Health and Human Services Kathleen Sebelius said Wednesday that self-insuring religious employers will be exempted from a contraception coverage mandate, clearing up a question raised by Catholic groups and other opponents who continued protesting the rule this week.
“Yes, I think that we will apply it to both,” Mrs. Sebelius told reporters, saying a new rule the administration offered last week to quell criticism will apply both to religious employers who buy plans for their workers and to those who self-insure.
“Whether it’s an insured plan or self-insured plan, that the employer who has a religious objection doesn’t have to directly offer or pay for contraception,” she said as reporters gathered around her Wednesday after a hearing on President Obama’s proposed budget before the Senate Finance Committee.”
I think it is fair to say that no one knows what that might mean – under the current proposed rule insurance companies collect premiums from an objecting company for everything other than contraception, then provide contraception coverage “for free”. That is somehow in contrast with insurance companies that collect a premium from non-objecting companies and then provide contraception coverage.
Whatever. How one might apply that same rule to the self-insured is a mystery but Ms.Sebelius *seems* to suggest that the spirit of the rule – objectors don’t pay – will be maintained.
“Secretary of Health and Human Services Kathleen Sebelius said Wednesday that self-insuring religious employers will be exempted from a contraception coverage mandate, clearing up a question raised by Catholic groups and other opponents who continued protesting the rule this week.
“Yes, I think that we will apply it to both,” Mrs. Sebelius told reporters, saying a new rule the administration offered last week to quell criticism will apply both to religious employers who buy plans for their workers and to those who self-insure.
“Whether it’s an insured plan or self-insured plan, that the employer who has a religious objection doesn’t have to directly offer or pay for contraception,” she said as reporters gathered around her Wednesday after a hearing on President Obama’s proposed budget before the Senate Finance Committee.”
Tom Maguire – maybe I’m being dense, but I don’t see how this “clarification” is supposed to allay the qualms of Catholic institutions that self-insure. She says, “Yes, we will apply it to both” – “both” presumably meaning Catholic institutions that self-insure and Catholic institutions that contract insurance to a third party; and “it” presumably being the proposed accommodation.
The accommodation requires the insurance provider to pay for the contraception. For a self-insured employer, the the ‘insurance provider’ is the employer itself. So I read her words here as stating that self-insured employers need to pay for contraception. Problem not solved.
Now, self-insured organizations usually hire a third-party administrator to administrator their self-insurance, and those third-party administrators are often insurers in their own right (although the service they are offering in those instance is not health care insurance, but only the administration of someone else’s health care insurance). So maybe her plan is to stick the subsidy responsibility to the third-party administrators? I can’t imagine the latter would be pleased with this, as the alleged savings that come from prevented pregnancies don’t save the administrator any money; it is the insurance organization that enjoys those savings.
Color me perplexed.
Re: “maybe I’m being dense”
I don’t think it’s you. I would say you have expressed my puzzlement cogently.
I thpught this thread was for those “with actual knowledge” Like Claire I was out, but the posts in general seem not to have taken note of the request!
Self-insured plans that were in existence on March 23, 2010 and have maintained their grandfathered status are exempt from the requirement to cover contraception if they didn’t cover it then.
Simply adding a couple of years to that date would solve the problem for all existing self-insured plans.
I’m puzzled that Bishop Dinardo’s February 15 letter to Senators asking suppport for S. 1467 describes the “accommodation” in a way that doesn’t match up with any description I have seen from the government. My understanding is that contraception will not be part of the benefits included in the employers plan. is it possible that th USCCB has misunderstood the proposal?