<nobr>Sep 22, 2009</nobr>

ERIC Expresses Concern Over Provisions in Senate Finance Committee "Mark"

Washington, D.C. -- In a letter sent today to Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Charles Grassley (R-IA), The ERISA Industry Committee (ERIC), while commending the lawmakers for their efforts on comprehensive health reform, expressed concern over proposals that could weaken the ability of employers to offer health benefits.

Noting that there are some who would permit States to obtain waivers of ERISA preemption, thwarting the ability of employers to administer their plans under nationally uniform rules, ERIC President Mark Ugoretz warns that ERIC "would strongly oppose any legislation that undermines in any way the national uniformity now provided by the Employee Retirement Income Security Act."

ERIC said that an excise tax on high-cost plans, the assessment for high-risk individuals, and the curtailment of the deduction for retiree drug costs in particular would undermine employer-based plans.

Concerning the excise tax on high-cost plans, Ugoretz says that, "[t]his tax ultimately will be borne by employers and employees. This additional tax burden will not be paid out of some hidden pot of money that employers maintain for rainy days. Rather, it is a cost that must reduce wages, benefits, or the number of employees on the employer's payroll. This is a provision that will cost jobs and weaken, not strengthen, the nation's healthcare system."

As to the proposed $20 billion assessment levied on all insurers, Ugoretz says "[i]t is unfathomable to us why employers with self-insured plans should be forced to subsidize the insurance industry. Employers already cover high-risk employees in their own plans that are more efficient and more effective than the individual market, and thus should not be required to pay an assessment to cover other high-risk individuals."

Ugoretz further writes that ERIC appreciates that the Mark does not include three provisions that would seriously harm the current employer-based healthcare system. "Most importantly, the current Mark does not violate the core precepts of ERISA preemption and national uniformity. Thus, the Mark generally preserves the ability of multistate employers to offer a uniform plan to all employees," Ugoretz says.

ERIC also expresses appreciation that the Mark does not impose a mandate upon employers that would limit their essential flexibility to tailor their health plans to the needs of their employees, and does not include a public plan option that could eventually result in the demise of the private insurance market.

Finally, ERIC points out that it supports reforms to the nation's health care system that reduces the number of uninsured Americans, emphasizes quality and efficiency, and reduces costs. Ugoretz writes that, "ERIC has been working toward those goals for several decades and developed a nationally uniform and comprehensive proposal in 2007 that would accomplish those goals through a 'New Benefit Platform for Life Security.'"

A link to ERIC's letter appears below.

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For more information:
Ted Godbout
Manager, Communications
The ERISA Industry Committee
1400 L Street, NW, Suite 350
Washington, DC 20005
Phone: (202)789-1400
Fax: (202)789-1120
tgodbout@eric.org
www.eric.org

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The ERISA Industry Committee (ERIC) is a non-profit association committed to representing the advancement of the employee retirement, health, and compensation plans of America's largest employers. ERIC's members provide benchmark retirement, health care coverage, compensation, and other economic security benefits directly to tens of millions of active and retired workers and their families. ERIC has a strong interest in proposals affecting its members' ability to deliver those benefits, their cost and their effectiveness, as well as the role of those benefits in the American economy.

Text Files:

Letter to Senate Finance Committee

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