Health Affairs
March 31, 2004
How Federalism Could Spur Bipartisan Action On The Uninsured
By Henry J. Aaron and Stuart M. Butler
… we share the belief that federally supported state experimentation is apromising way to make progress. States should be allowed to try widely differing solutions with federal financial support under legislated guidelines, including specific protections and measurable goals.
Crafting a single-payer experiment:
ERISA, which exempts self-insured plans from state regulation, is the primary technical obstacle to testing single-payer plans. The political sensitivity to modifications in ERISA is difficult to exaggerate. Anyattempt to carve out an exception from ERISA for state programs to extend coverage would probably doom federal legislation. But states could create”wraparound” plans to cover all who are not currently insured, or even to cover all who are not insured under plans exempted by ERISA from state regulation. While such n arrangement would not be a single-payer plan, it could achieve universal coverage, which is one defining characteristic of single-payer plans, and arguably be sufficient for a valid test. After all, the U.S. health care system is characterized by different subsystems for certain populations and has a form of single-payer coverage for militaryveterans. But of course the real test is whether advocates of single-payer plans regard such a limited arrangement as a fair trial.
http://content.healthaffairs.org/cgi/content/abstract/hlthaff.w4.168
ERISA compliance:
http://www.dol.gov/ebsa/compliance_assistance.html
Comment: The Employee Retirement Income Security Act of 1974 (ERISA)requires employers to meet certain minimum standards in the administration of employee pension and welfare benefit plans.
An important provision of the ERISA regulations is that self-insured plans of large employers be exempt from state regulation. In fact, comprehensive reform proposals, such as the single payer model, are often rejected simply because the design would not comply with existing ERISA regulations since exempt programs would be folded into a state regulated system.
Because of ERISA’s importance in protecting benefit programs, it has achieved the status of being written in stone. Rather than modifying ERISA to comply with new programs, new programs are designed to comply with ERISA regulations. Aaron and Butler are even making the ridiculous suggestion that a proposal that has absolutely no resemblance to the single payer model be tested as a single payer model, in name only, merely to comply with ERISA regulations.
But any law or regulation can be modified. Even the United States Constitution can be amended. Since a single payer system would fulfill essentially all of the reasons that ERISA health benefit regulations exist, while providing even greater additional advantages, modifying ERISA to enable enactment of a single payer system certainly would be a step forward.