[Congressional Record (Bound Edition), Volume 163 (2017), Part 4]
[House]
[Pages 5605-5608]
[From the U.S. Government Publishing Office, www.gpo.gov]




                     SELF-INSURANCE PROTECTION ACT

  Ms. FOXX. Mr. Speaker, pursuant to House Resolution 241, I call up 
the bill (H.R. 1304) to amend the Employee Retirement Income Security 
Act of 1974, the Public Health Service Act, and the Internal Revenue 
Code of 1986 to exclude from the definition of health insurance 
coverage certain medical stop-loss insurance obtained by certain plan 
sponsors of group health plans, and ask for its immediate consideration 
in the House.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. Rice of South Carolina). Pursuant to 
House Resolution 241, the amendment in the nature of a substitute 
recommended by the Committee on Education and the Workforce, printed in 
the bill, shall be considered as adopted, and the bill, as amended, 
shall be considered read.
  The text of the bill, as amended, is as follows:

                               H.R. 1304

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Self-Insurance Protection 
     Act''.

     SEC. 2. CERTAIN MEDICAL STOP-LOSS INSURANCE OBTAINED BY 
                   CERTAIN PLAN SPONSORS OF GROUP HEALTH PLANS NOT 
                   INCLUDED UNDER THE DEFINITION OF HEALTH 
                   INSURANCE COVERAGE.

       (a) ERISA.--Section 733(b)(1) of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1191b(b)(1)) is 
     amended by adding at the end the following sentence: ``Such 
     term shall not include a stop-loss policy obtained by a self-
     insured health plan or a plan sponsor of a group health plan 
     that self-insures the health risks of its plan participants 
     to reimburse the plan or sponsor for losses that the plan or 
     sponsor incurs in providing health or medical benefits to 
     such plan participants in excess of a predetermined level set 
     forth in the stop-loss policy obtained by such plan or 
     sponsor.''.
       (b) PHSA.--Section 2791(b)(1) of the Public Health Service 
     Act (42 U.S.C. 300gg-91(b)(1)) is amended by adding at the 
     end the following new sentence: ``Such term shall not include 
     a stop-loss policy obtained by a self-insured health plan or 
     a plan sponsor of a group health plan that self-insures the 
     health risks of its plan participants to reimburse the plan 
     or sponsor for losses that the plan or sponsor incurs in 
     providing health or medical benefits to such plan 
     participants in excess of a predetermined level set forth in 
     the stop-loss policy obtained by such plan or sponsor.''.
       (c) IRC.--Section 9832(b)(1)(A) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     new sentence: ``Such term shall not include a stop-loss 
     policy obtained by a self-insured health plan or a plan 
     sponsor of a group health plan that self-insures the health 
     risks of its plan participants to reimburse the plan or 
     sponsor for losses that the plan or sponsor incurs in 
     providing health or medical benefits to such plan 
     participants in excess of a predetermined level set forth in 
     the stop-loss policy obtained by such plan or sponsor.''.

  The SPEAKER pro tempore. The gentlewoman from North Carolina (Ms. 
Foxx) and the gentleman from Virginia (Mr. Scott) each shall control 30 
minutes.
  The Chair recognizes the gentlewoman from North Carolina.

                              {time}  1445


                             General Leave

  Ms. FOXX. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days in which to revise and extend their remarks and 
include extraneous materials on H.R. 1304.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from North Carolina?
  There was no objection.
  Ms. FOXX. Mr. Speaker, I yield myself such time as I may consume.
  I rise today in strong support of H.R. 1304, the Self-Insurance 
Protection Act.
  Mr. Speaker, across the country, hardworking men and women are 
struggling to afford rising healthcare costs, and their options 
continue to drop year after year. At the same time, employers, large 
and small, are finding it harder to provide the type of high-quality, 
affordable healthcare coverage their employees need.
  With over 150 Americans relying on an employer-sponsored health plan, 
Congress must do everything possible to ensure employers have the tools 
they need to help control healthcare costs for working families. 
Preserving access to self insurance is one simple step we can take as 
part of that effort.
  More than 60 percent of employers who offer healthcare coverage 
choose to self-insure. This means that instead of purchasing a plan 
from an insurance company, employers pay their employees' healthcare 
costs directly. As a result, the employers have greater flexibility to 
structure a healthcare plan to the unique needs of workers and their 
families.
  Although these plans provide important protections, they are free 
from certain restrictive rules that force workers to purchase one-size-
fits-all benefits that they may not want or need. Self-insurance is a 
popular option that often leads to lower health insurance premiums for 
workers and their families.
  In years with below average medical claims, any remaining healthcare 
dollars can help offset premiums for workers the following year, or can 
be used to help create new jobs and higher wages.
  It is not just private sector employers who like the flexibility and 
affordability of self-insured health coverage. It is also embraced by 
labor organizations, schools, cities, and counties.
  Of course, there is some level of risk associated with these plans. 
That is why employers purchase stop-loss insurance, so that employees 
can count on their healthcare coverage when they need it. Because it 
simply serves as a financial backstop to an actual health insurance 
policy, stop-loss has never been regulated as health insurance by the 
Federal Government. Never.
  But as we all know, the previous administration had a constant urge 
to regulate practically every aspect of American life, regardless of 
the consequences. It was only a matter of time before the Obama 
administration made stop-loss insurance one of its regulatory targets, 
even though many employers would find it nearly impossible to self-
insure as a result.
  Limiting a popular free-market healthcare option that millions of 
Americans rely on was a price they were willing to pay in order to push 
their government-run healthcare scheme.
  Fortunately for working families, the Obama administration was 
unsuccessful, and we now have a new administration committed to 
expanding, not limiting, affordable healthcare options. However, all 
this highlights the need to protect access to self-insurance.
  Employers need long-term certainty when it comes to the healthcare 
benefits they provide, and working families deserve peace of mind that 
they won't lose the plan they like because of a partisan, unnecessary 
Federal regulation. The Self-Insurance Protection Act provides that 
certainty and peace of mind by reaffirming existing law and preventing 
Federal bureaucrats from regulating stop-loss as health insurance.
  There is more we can and should do to promote affordable healthcare 
coverage for working families. This legislation is one small step we 
can take to ensure Americans can continue to benefit from flexible 
healthcare plans that help lower costs.
  I urge my colleagues to stand up for affordable healthcare options 
for workers and employers by voting in favor of H.R. 1304.

[[Page 5606]]

  Mr. Speaker, I reserve the balance of my time.
  Mr. SCOTT of Virginia. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, H.R. 1304, the Self-Insurance Protection Act, purports 
to protect stop-loss insurers from being regulated at the Federal 
level. It appears that we are considering a bill that is a solution in 
search of a problem.
  I am not opposed to stop-loss insurance or the purpose of stop-loss 
insurance. It can be helpful in shielding employers from unforeseen 
risks in many instances when they choose to self-insure and want to 
protect themselves from unexpected and unusually high expenses.
  Now, while many self-funded plans, in conjunction with the purchased 
stop-loss, look like a traditional fully insured plan, stop-loss 
coverage itself is not regulated at the Federal level. There is no 
indication or suggestion that the administration would seek to regulate 
stop-loss insurance, so the bill prohibits Federal regulation of stop-
loss insurance.
  The Federal Government does not regulate stop-loss insurance today, 
and doesn't look like it is going to seek to regulate self-insurance in 
the foreseeable future, so it is difficult to ascertain exactly what 
the purpose of the bill is.
  But employers, particularly small ones, do face risks when self-
insuring. I think it is important that we ensure that employers are 
aware of the risks and protect them and their employees when 
appropriate. They can incur tremendous losses if the employee incurs a 
serious injury or illness.
  Employees are also at risk of receiving fewer benefits because many 
consumer protections do not apply to self-funded plans.
  Employers are legally prohibited from discriminating on the basis of 
health status, but stop-loss insurers are not. Many policies have 
provisions that will trigger immediate, even retroactive, increased 
premiums when the stop-loss insurer receives greater-than-expected 
claims.
  To date, many States have taken action to regulate stop-loss 
insurance in order to protect both businesses and workers. Some have 
required a minimum, what is called attachment point. That is when the 
stop-loss insurance kicks in. Others have restricted the selling of 
stop-loss insurance with certain small group markets.
  New York prohibits the sale of stop-loss insurance to small 
employers, and prohibits employers from serving as their own third-
party administrators. North Carolina has chosen to regulate stop-loss 
insurance as if it were normal health insurance, holding stop-loss 
insurance to the same standards of others in the market.
  Now, if States want to ban stop-loss insurance altogether, that 
should be a State prerogative. States have taken these steps because, 
frankly, self-insuring and stop-loss insurance come with greater risks 
to both employers and employees. Stop-loss plans place annual limits on 
services. Some place annual limits on services or exclude coverage for 
certain benefits, such as prescription drugs.
  Furthermore, the renewal of stop-loss insurance is not guaranteed, so 
if an employer suddenly has high medical costs, the stop-loss insurer 
can refuse to renew or charge so much that it is no longer affordable.
  In the committee markup, the gentlewoman from Oregon (Ms. Bonamici) 
offered a clarifying amendment to ensure that this legislation would 
not be construed to restrict the ability of States to regulate stop-
loss insurance. Chairwoman Foxx agreed to include such clarifying 
language in the committee report, agreeing with the intent of that 
amendment. Based on that understanding, that amendment was withdrawn.
  The clarifying language is in the report, and that clarification is 
vital to ensure that there is nothing in the bill that incorrectly can 
be interpreted as to preempt or restrict a State's ability to regulate 
stop-loss insurance as they see fit, or otherwise restrict effective 
oversight and regulation of these policies at the State level. I 
appreciate the majority's willingness to work with us on the inclusion 
of that clarifying language.
  Mr. Speaker, while I don't intend to oppose the legislation, I would 
note that it seems to be a distraction from the Republicans' recent 
failed attempt to repeal the Affordable Care Act. After 7 years of 
complaints, the Republicans offered an alternative which was 
demonstrably worse than the Affordable Care Act on every measure; more 
people uninsured, higher prices, and the policy you end up getting is 
worse.
  Democrats will continue to resist any attempts to move this country 
backwards by making health insurance less accessible and less 
affordable to American families.
  Mr. Speaker, I reserve the balance of my time.
  Ms. FOXX. Mr. Speaker, I yield 5 minutes to the gentleman from 
Tennessee (Mr. Roe), the author of the bill, a member of the Education 
and the Workforce Committee, and chair of the Veterans' Affairs 
Committee.
  Mr. ROE of Tennessee. Mr. Speaker, I rise today in support of the 
Self-Insurance Protection Act, H.R. 1304.
  Mr. Speaker, I find it hardly plausible you could make something 
worse where one-third of the counties in my district have no option to 
buy any insurance on the exchange, and the third largest county in the 
State of Tennessee has no option. So I would beg to differ, Mr. 
Speaker.
  We all want to ensure workers have access to high-quality, affordable 
health coverage. That is exactly what this legislation is all about.
  Self-insured plans offer high-quality healthcare coverage at a 
reasonable cost for workers. This popular option allows employers to 
pay their employees' healthcare costs directly and, if costs are lower 
than expected, those savings can be reserved for later years to help 
cover their workers' future healthcare costs.
  One of the benefits to self-insurance is that employers have more 
flexibility to customize their healthcare plans as they see fit for the 
unique needs of their employees. These plans are also free from many of 
the restrictive requirements associated with traditional healthcare 
plans, requirements that limit choices and force employees to purchase 
specific benefits they may not want or need.
  As healthcare costs have risen, many employers have turned to this 
cost-effective model. In fact, in 2016, more than 60 percent of all 
employers offering health insurance coverage were self-insured, of the 
160 million or so people in this country that have insurance through 
their job.
  Even the labor unions have embraced this approach. However, employers 
may also take greater financial risk when providing this popular option 
to workers. To help mitigate that risk, many employers opt to purchase 
stop-loss insurance.
  Stop-loss insurance is not health insurance, nor has it ever been 
considered health insurance under Federal law. It does not process 
medical claims, and it does not perform any other traditional function 
of health insurance. What it does instead is provide employers choosing 
to provide self-insurance with a financial backstop, protecting the 
benefits of workers and their families.
  Unfortunately, the former administration threatened to regulate stop-
loss insurance as traditional health insurance, a move that would put 
workers and their families at risk of losing access to the self-insured 
market. While we now have a new administration that understands the 
importance of providing more pathways to affordable healthcare 
coverage, Congress must also act to ensure that no future 
administration will be able to restrict the self-insurance option. The 
Self-Insurance Protection Act does just that.
  This legislation reaffirms longstanding policies, prevents future 
bureaucratic overreach, and clarifies once and for all that stop-loss 
insurance is not health insurance. By supporting H.R. 1304, we will 
promote more choices and protect access to affordable healthcare 
coverage options for families.
  Let me put this all in English. I was the mayor of Johnson City, 
Tennessee,

[[Page 5607]]

where we had a self-insured plan for the teachers and for the workers 
there at the city. The city provided an opportunity for people to have 
health insurance for their families. We would accept risks up to 
$250,000, and then we bought policies to protect the taxpayers and the 
city from any costs that went above that.
  What this plan also allowed us to do is put in incredibly innovative 
health prevention, things like wellness programs, smoking cessation, 
weight loss, diabetes screening, lowering cholesterol. We put all those 
things in that plan, which helped hold--even with insurance premiums 
going up, we were able to level insurance costs going up and, 
therefore, save the employees and the teachers money in that community. 
That is all it is.
  Everybody buys insurance in this country to mitigate risk. When you 
by homeowners insurance, you say: I will have $1,000 deductible. So if 
I have a roof blow off, I can stand to pay $1,000, but my insurance 
covers the rest.
  That is all this is. It just protects risk.
  Mr. Speaker, I urge my colleagues to support H.R. 1304.
  Mr. SCOTT of Virginia. Mr. Speaker, I reserve the balance of my time.
  Ms. FOXX. Mr. Speaker, I yield 3 minutes to the gentleman from 
Michigan (Mr. Walberg), chairman of the Health, Employment, Labor, and 
Pensions Subcommittee.
  Mr. WALBERG. Mr. Speaker, I rise today in support of H.R. 1304, the 
Self-Insurance Protection Act. I thank my good friend, Dr. Phil Roe, 
for his leadership and insights on this issue.

                              {time}  1500

  As the Affordable Care Act continues its death spiral--and indeed it 
does, very clearly, and ultimately will leave people without 
insurance--too many small businesses in the process and working 
families in my district have been left without real options for 
healthcare coverage that they can afford.
  Self-insured plans are one solution that small businesses have tried 
to push back against these rising costs. These policies provide 
employers flexibility to design a healthcare plan tailored to the 
unique needs of their workers and their families. Last year, over 60 
percent of employers who offered healthcare coverage utilized self-
insured plans.
  Unfortunately, the previous administration pursued regulations that 
would jeopardize access to self-insured plans by redefining stop-loss 
insurance as traditional health insurance under Federal law. Stop-loss 
insurance does not pay our medical claims; rather, it is a tool--I 
remind you--that simply provides protections for employers to guard 
against a catastrophic medical claim.
  Mr. Speaker, our constituents need more affordable healthcare 
options, not fewer; and the bill before us will stop any future 
administration from putting harmful limitations on self-insured plans. 
To achieve meaningful healthcare reform, we must promote flexibility 
and innovative options, not curtail them.
  H.R. 1304 provides much-needed certainty to the workers and employers 
who access quality care through self-insured healthcare plans. As 
employers and their employees look to plan for the future, the Self-
Insurance Protection Act will help provide some long-term certainty 
that these affordable health insurance options are available. I ask my 
colleagues to join me in supporting this legislation and promoting 
healthcare choice for American workers and for their employers.
  Mr. SCOTT of Virginia. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, we are continuing to hear complaints about the 
Affordable Care Act. Whatever someone thinks about the Affordable Care 
Act, I think it is important to look at the replacement that was 
offered just over a week ago which actually would have made things 
worse. It would have increased the number of uninsured, it would have 
increased the price, it would have reduced the quality of the product, 
and it would have made it less likely that insurance companies would 
come in and offer anything at all.
  If we are going to amend the Affordable Care Act, we ought to improve 
it. We ought to make things better. We should first do no harm with the 
Affordable Care Act, and we should not allow this administration to 
sabotage the Affordable Care Act. When they said it might implode, we 
have to be careful that they are not doing the implosion. There are 
things that this administration can do to undermine the Affordable Care 
Act and sabotage it, and we would hope that we would join in a 
bipartisan effort to make sure that that does not happen.
  Mr. Speaker, I reserve the balance of my time.
  Ms. FOXX. Mr. Speaker, I yield 2 minutes to the distinguished 
gentleman from Michigan (Mr. Mitchell) who is a member of our 
committee.
  Mr. MITCHELL. Mr. Speaker, I thank the gentlewoman from North 
Carolina for yielding.
  Mr. Speaker, I rise today in support of the Self-Insurance Protection 
Act, of which I am a proud cosponsor. Restoring health care is more 
than one bill--our plan has always included a series of efforts to 
directly address the challenges facing our healthcare system. The 
challenges resulted from ObamaCare. This legislation is one such 
effort, part of a series of measures to increase choice and access. 
This bill would make it easier for families to get health insurance 
from their employers.
  As my colleagues have noted, more than 160 million Americans get 
their insurance from an employer. Of that, 60 percent of employers 
offering healthcare coverage are self-insured, meaning employers 
directly reimburse healthcare providers and employees for medical 
expenses. These self-insured plans provide more flexibility than 
traditional healthcare plans, as they can be designed and operated to 
meet the unique needs of workers and families. For many years, the 
company I led, in fact, was self-insured, and we bought stop-loss 
coverage.
  For most self-insured employers, choosing to buy stop-loss insurance 
simply assists them in avoiding catastrophic losses. It is a business 
insurance policy. Regulating it like a traditional healthcare insurance 
would restrict access to self-insured plans dramatically.
  We should be making it easier, not harder, for employers to offer 
their employees comprehensive health packages, and it certainly should 
not be left to an unelected bureaucrat to decide which types of plans 
or which benefits work for American families.
  This legislation is a simple, straightforward approach to protect 
self-insured healthcare plans. It offers clarity, reaffirming 
longstanding policies recognizing that stop-loss insurance is a 
distinct business insurance and prevents bureaucrats from--one more 
time--tinkering with our economy and damaging health care.
  I urge my colleagues to support this legislation, as it is an 
important measure to promote and to increase access to health care.
  Mr. SCOTT of Virginia. Mr. Speaker, I yield myself the balance of my 
time.
  Mr. Speaker, this bill prohibits Federal regulation of stop-loss 
insurance. The Federal Government does not regulate stop-loss 
insurance. It does not affect the States' ability to regulate the 
insurance, and that is where it should be done. So the bill does no 
harm. I would hope that, after this bill, we will refocus our efforts 
into addressing some of the challenges with the Affordable Care Act by 
first doing no harm, not going backwards like the bill did several days 
ago where the costs went up, the number of insurers went down, and the 
quality of the insurance was worse. We can improve healthcare coverage 
in this country, but we can't do it if the first step is a backward 
step.
  Mr. Speaker, I yield back the balance of my time.
  Ms. FOXX. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, we all want workers and employers to have access to 
high-quality, affordable healthcare coverage, and that is exactly what 
this legislation is about.
  Our Nation faces significant healthcare challenges. Costs are 
soaring, and choices are diminishing. This

[[Page 5608]]

legislation will in no way address all of these challenges; however, it 
is one step we can take to protect access to affordable healthcare 
options for workers and employers.
  Let's give workers and employers who rely on self-insured healthcare 
plans a little bit of certainty and peace of mind today by passing this 
commonsense legislation.
  Mr. Speaker, I urge Members to vote in favor of the Self-Insurance 
Protection Act, and I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Duncan of Tennessee). All time for 
debate has expired.
  Pursuant to House Resolution 241, the previous question is ordered on 
the bill, as amended.
  The question is on the engrossment and third reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Ms. FOXX. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER. Pursuant to clause 8 of rule XX, further proceedings on 
this question will be postponed.

                          ____________________