Implications of ERISA for health benefits and the number of self-funded ERISA plans

This Issue Brief provides an overview of the issues relating to the Employee Retirement Income Security Act of 1974 (ERISA) and health benefit plans, the major case law relating to ERISA and health plans, and the implications of the preemption of state regulations for health plan sponsors and participants. It also presents the latest data on the number of health plan participants in self-funded ERISA plans. Finally, it presents a summary of current legislative proposals that would attempt to amend ERISA. Under the framework ERISA established for employee benefit plans, the regulation of employment-based health benefit plans has evolved into a two-tiered system in which both federal and state laws play important roles. The Supreme Court has interpreted ERISA's "savings" and "deemer" clauses to mean that insured plans are subject to regulations directly at the federal level and indirectly at the state level, while self-funded plans are regulated exclusively at the federal level. The ERISA statute and the courts' interpretations of the Act have created a sharp controversy over how employee health benefit plans are provided and administered, with state regulators and consumer advocates on one side of the debate and plan sponsors (e.g., employers and unions) on the other. State regulators and consumer advocates tend to favor more regulation, and in many instances greater regulation at the state level, which they argue would provide more protections for consumers. However, employers and unions (or any plan sponsors) think ERISA preemption is very important to their ability to provide innovative and cost-effective health benefits for their employees, and assert that ERISA's present structure should be preserved. The U.S. General Accounting Office (GAO) found that 44 million individuals (39 percent of those in ERISA plans) were enrolled in self-funded ERISA plans in 1993, up from 39 million (33 percent of those in ERISA plans) in 1989. The Employee Benefit Research Institute (EBRI), using the same methodology as GAO with 1995 data, estimated that 48 million individuals (39 percent of those in ERISA plans) were enrolled in self-funded ERISA plans in 1995. When policymakers look to amend ERISA, they should consider whether the change to ERISA will produce a higher level of quality for consumers than is being provided under the present system and will continue to do so in the future. Policymakers must also decide whether quality of care is better enhanced by health plans' greater exposure to liability or by market forces. If policymakers decide that increased exposure to liability is the route to go, will consumers be able to enjoy any potential improvement in quality or will more individuals end up uninsured because of increased costs and not be able to get any care regardless of the quality?     

Primary care networks: choose your physicians wisely

As hospitals and health care systems maneuver for a position in the integrated health care delivery system, no initiative is more important than building an effective and competitive primary care network. Yet this critical initiative is fraught with potential pitfalls. In their haste to develop primary care networks, hospitals and health care systems may fail to thoroughly evaluate network participants and in turn create large, inclusive, and inefficient primary care networks that don't come close to breaking even, much less repay practice acquisition costs. In an effort to become more efficient, practitioners often find themselves in the unenviable position of "de-selecting" peers retrospectively. The author presents criteria for evaluating and selecting network physicians.     

Sustainability of family planning and health projects

USAID has assisted the Ghanian Ministry of Health since 1991 to boost family planning services under the Ghana Family Planning and Health Project by providing supplies and information and increasing the effectiveness of HIV/AIDS prevention and control. The sustainability of the health system is endangered by favoring capital expenditures in lieu of continuous expenditures; the lack of linkage between project activities and regular activities; the centralization of resource flow; and too ambitious targeting. Capital outlays provided by USAID featured in the construction of four public health laboratories, but their operation also requires continuous financing amounting to about 10% of the whole investment. The latter is the responsibility of the government, although the details of these recurrent costs were not detailed at the outset and providing these funds for continuous operation may impair the operation of other systems. The resource constraints could be alleviated by an effective cost-recovery system or by the general improvement of the economy. The lack of linkage between project and regular activities is serious at regional and district levels. The centralization of resource flow means that most resources are kept for headquarter level activities, thus other activities suffer and the health sector becomes excessively reliant on donor support. Too ambitious planning stems from pressure on donors and hastily implemented projects result in duplication and waste. Closer consultation with the parties involved would improve the situation. The rivalry of technical and policy groups has contributed to past deficiencies. Double funding for the same activity has also occurred further increasing the dependence on donor funding. By concentration on people and systems sustainability would be enhanced, while cost recovery would help the operation of the laboratories. The Health Education Unit (HEU) recognized the importance of IEC and obtained financing for such activities.     

Physician organizations. Part 1: A report from the trenches of a start-up PO

How has Community Health Partners, a physician organization based in Kansas City, turned the corner as it rolls into the second year of operation? The biggest indicator is that CHP hammered out the city's first professional risk contracts and the PO has grown from 23 to more than 50 physician member/owners. Looking back, there are at least 10 reasons why CHP made it this far. These are not reasons you learn about in medical school or an MBA program. There is no one-size-fits-all template for building POs. No fixed organizational chart. No neon signs pointing to the best capital partner. Part I explores five reasons for success, such as having a strong board and physician leadership, as well as educating participating physicians about capitation and affiliating with any hospital or payer that really knows how to partner with physicians. Part 2 will focus on five more lessons learned from the trenches of a start up PO.     

The shape of public health policy: the Australian experience

Public health policy is shaped by many factors. A brief historical reflection is given on policy development in Australia to illustrate the various influences on health policy. Medical technology; ethical trade-offs; environmental, social, and political imperatives; popular movements; and changing patterns of disease; as well as market forces have helped to shape Australian contemporary public health policy. These multiple and often competing forces, however, can work against individual consumer choice in health care decisions. This article demonstrates through the eyes of history the factors that shape public health policy. As Australia has a short history compared to most industrialized democratic societies and can be viewed as a microcosm, it is used as the exemplar.     

Population statistics] as of July 1, 1997

In thousands, Thailand's total population as of July 1, 1997, was 60,440, of which 30,202 were male and 30,238 were female. 19,087 live in urban areas and 41,353 live in rural areas. 12,141 live in the northern region, 19,678 to the northeast, 7566 in the South, 13,112 centrally, and 7943 in the Bangkok metropolis. 16,288 were under age 15, 39,073 aged 15-59, and 5079 aged 60 and over. There were 15,558 women of reproductive ages 15-44. Crude birth and death rates per 1000 population were 15.6 and 5.0, respectively, with an overall natural growth rate of 1.1%. Infant mortality was 25.0 per 1000 live births. Male and female life expectancies at birth were 66.6 and 71.7 years, respectively. Further life expectancies at age 60 for males and females were 18.8 and 22.0 years, respectively. The rate of total fertility per woman was 1.98 with a contraceptive prevalence rate of 72.2% and an anticipated population of 70,642 in the year 2012.     

Chinese Communist Party Central Committee calls on Party and Youth League members to take the lead in having only one child (per couple), [open letter,September 25, 1980

This open letter from the Central Committee of the Chinese Communist Party concerns the question of controlling China's population growth. To limit the total population of China to 1.2 billion by the end of this century, the State Council has advocated 1 couple giving birth to only 1 child. China's total population will reach 1.3 billion after 20 years and will exceed 1.5 billion after 40 years. Besides the family needing to increase the cost of upbringing, increasing population also requires the state, in order to solve their education, employment, and otheer problem, to raise education expenditures, investments of equipment, and outlays for social and public utilities. The phenomenon of population "aging" will not occur within this century because at present 1/2 of the total national population is below the age of 21, while elderly people above age 65 consist of less than 5%. After 40 years of the practice of 1 child per couple, some families may experience the problem where the elderly lack people to care for them. In the future when production is developed and the people's lives are improved, social welfare and social security will certainly increase and improve continuously. To control population growth, the Party and government have already adopted a series of concrete policies; considerations and allowances are to be given to single children and their families with respect to admission to childcare centers and primar schools. Young comrades must begin with themselves, while old comrades must educate and supervise their own sons and daughters.     

阿拉贡:成长与变化

去年,为了庆祝法共作家阿拉贡的八十岁生日,法共通过它的报刊发表文章,对他的创作展开评价.在新里昂大学组织的"阿拉贡月"的一次报告会上,法共作家普列伏斯特作了这个题目的演说,对阿拉贡在创作道路上经历的三个阶段进行了分析.《新评论》杂志1977年6、7月号刊登了这篇演说,摘译如下.