Tom's Take Blog
One Pro’s Perspective on Employee Benefits
Here at Cypress, we’re constantly fielding questions related to employee benefits and cost containment. And with his 25+ years of experience in third party administration, our company CEO and president has become a go-to source – or guru, as we like to call him – in the self-funded world. Tom Doney has been summoned to speak in front of the U.S. Department of Labor on cost control in health care and travels nationwide to deliver eye-opening conferences on the topic. In his new blog, Tom will continue to share his unique perspective and dive into all types of topics from medical advocacy to health claim management. Read along!
April 18, 2018
What are the main laws that regulate self-funded health plans?
Tom’s Take: This question comes up a lot as more and more employers explore the self-funding structure for their company-sponsored health benefits.
The Department of Labor (DOL) and its Employee Retirement Income Security Act of 1974 (ERISA) serve as the main governing body for self-funded plans. A federal law, ERISA was created as a way to protect plan participants and their beneficiaries through a series of standards that plan managers must follow. It is meant to ensure fiduciary duty, transparency and accountability, and provide plan participants with important information about their benefits.
In addition to the DOL’s ERISA law, there are many other federal regulations that self-funded plans must comply with. Some of these include HIPAA, ADA, COBRA and the IRS’s employer shared responsibility provisions.
One thing that’s important to point out is that self-funded plans differ from fully insured plans in the role state mandates have. With self-funding, there is no insurance carrier, so these plans are generally only subject to federal laws. This can be beneficial to employers who have multi-state operations and want to offer consistent health benefits from location to location.
For more information on how self-funded plans are regulated, third party administrators can be a great resource. You can also find some helpful guidance from the DOL: https://www.dol.gov/general/topic/retirement/erisa.