Rep. Cramer: Self-Insurance Protection Act Preserves Choice for Families, Small Businesses

WASHINGTON, April 5 -- Rep. Kevin Cramer, R-N.D., issued the following news release:

Congressman Kevin Cramer supported a bill passed by the U.S. House of Representatives today, which ensure workers and employers can continue having access to affordable, flexible health plans through self-insurance.

H.R. 1304, the Self-Insurance Protection Act, reaffirms the long-standing policy that stop-loss insurance is not deemed as health insurance, and clarifies that federal regulators cannot redefine these insurance plans in future administrations.

"Self-Insurance is a legitimate and proven free-market approach to lowering health care costs for families and small businesses," said Cramer. "It's concerning the prior administration was considering regulating this market, which would only continue to decrease health care options for employers. I applaud the passage of this bill, and I hope it moves swiftly through the Senate and on to the President for his signature."

According to the House Education and Workforce Committee, in 2016, 61 percent of all employers offering health care coverage were self-insured. With this option, employers cover the costs of their employees' medical expenses either by directly reimbursing health care providers or directly reimbursing employees as claims arise. Employers can either process claims in-house or work with a third party administrator. Through a self-insured plan, employers and employees have greater control over their health care dollars and are able to retain savings in years with lower-then-expected costs. Unlike traditional or fully-insured health care plans, self-insured plans are free from the myriad mandates that force employees to purchase specific benefits they may not want or need. Even union leaders have embraced this approach and the flexibility it provides to customize a health care plan to the unique needs of workers and families.

Most self-insured employers also purchase "stop-loss" insurance, a financial risk-management tool designed to protect employers from catastrophic claims expenses. The federal government has never regulated stop-loss insurance, recognizing it is wholly different than traditional health insurance. However, the Obama administration repeatedly signaled interest in regulating stop-loss insurance as health insurance, which would severely restrict access to self-insured plans.

Considered part of the "third phase" in the GOP health reform plan, the Self-Insurance Protection Act is the third House bill passed this Congress to address the faults of our failing health care system. Cramer also supported the Small Business Health Fairness Act and the Competitive Health Insurance Reform Act, which both passed in mid-March.