Multiemployer Pension Plans

The Number of Individuals in Self-Funded ERISA Health Plans

June 1999, Vol. 20, No. 6
Paperback, 16 pp.
PDF, 105 kb
Employee Benefit Research Institute, 1999

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Executive Summary

Multiemployer Pension Plans—A multiemployer pension
plan is an employment-based retirement plan to which more than
one employer contributes in accordance with one or more
collective bargaining agreements. Contributions to support such
plans are negotiated at the initiative of a labor union or group
of labor unions representing the workers of a number of
companies, usually in a given geographic area. The workers are
usually engaged in the same kind of employment.

The Number of Individuals in Self-Funded ERISA Health Plans—A
fundamental issue in the current debate over patient protection
legislation is the manner in which the Employee Retirement Income
Security Act of 1974 (ERISA) regulates group health plans. ERISA
is the primary legislation governing all private-sector
employment-based group health plans in the United States. In
general, it supersedes (or pre-empts) all state laws that
“relate to” employee benefit plans, but it
“saves” state regulation of the “business of
insurance.” However, it prevents states from
“deeming” benefit plans to be in the “business of
insurance” for the purpose of state regulation. Because of
the complexity of these definitions, both federal and state
courts are frequently involved in cases that hinge on determining
whether a state law or regulation is preempted by ERISA or saved
from pre-emption and thereby subject to state regulation. The two
most predominant issues concerning ERISA and group health plans
are the different regulatory structures that group health plans
face depending upon how they are implemented, and the pre-emption
of state tort law claims for all private-sector employment-based
group health plans. Group health plans governed by ERISA are the
largest source of health care coverage for the nonelderly
population in the United States. Therefore, any changes to ERISA
could have a significant impact on the number of people insured
and the type of insurance that many people have.