SIIA Opposes California Bill Restricting Self-Insurance for Smaller Employers
Washington, DC, April 14, 2012 --(PR.com)-- The Self-Insurance Institute of America, Inc. (SIIA) today
announced that it will work to defeat California legislation that would effectively eliminate the ability of
smaller employers to self-insure their employee healthcare plans.
As amended this week, the proposed bill, SB 1431, now would prohibit the sale of stop-loss policies to
employers with fewer than 50 employees to reimburse employers for specific claims lower than $95,000
(the attachment point). For aggregate claims, stop-loss attachment points would be prohibited below the
greater of $19,000 times the total number of covered employees and dependents; 120 percent of expected
claims; or $95,000.
“This would reduce the ability of smaller employers to provide sound, valuable health plans for their
employees under federal ERISA protection,” said Mike Ferguson, SIIA's chief operating officer.
“Unnecessarily high attachment points of stop-loss insurance would reduce the economic benefits of
self-insuring and throw employers back into the expensive traditional insurance marketplace,” he added.
In addition to the attachment point restriction, the legislation contains language that erroneously refers to
stop-loss insurance carriers providing “coverage” to individual employees and dependents. This mistaken
characteristic of stop-loss insurance has been corrected in 12 federal court findings that stop-loss
insurance is not health insurance covering individuals, but reimburses the employee plan for losses above
SIIA continues to effectively rebut such concerns and educate policy-makers about how self-insured
health plans operate and why such regulatory action is misguided. The association charges that legislative
and regulatory initiatives are prompted by insurance industry groups and major health insurance carriers
to deter smaller employers from self-insuring. The association has undertaken a grassroots lobbying
campaign among its members to defeat the California legislation.
SIIA is a non-profit trade association that represents the business interests of companies involved in the
self-insurance/alternative risk transfer (ART) industry, both domestically and internationally.
Self-Insurance Institute of America, Inc.
Contact via Email
David Kirby: 410-539-6888
Online Version of Press Release:
You can read the online version of this press release at: http://www.pr.com/press-release/405538