Members of the Risk and Insurance Management Society, Inc. (RIMS) have a clear interest in maintaining a voluntarily managed system that keeps employees healthy and productive. There is strong bi-partisan support for "patient protection" legislation and both the House of Representatives and Senate have passed legislation to reform managed care. House and Senate Conferees are currently working to finalize legislation. Part of the intent of this legislation is to protect against problems caused by a small number of health plans and groups. RIMS encourages the Conferees to find an effective approach to minimize such problems without adversely impacting employer’s voluntary health plans that provide needed protection for much of the American workforce. RIMS is concerned that certain provisions of the Dingell-Norwood bill (H.R. 2990) will drive up the costs of providing health care for employees and have the unintended consequence of limiting access to health care.

RIMS favors health insurance reforms that would:

• Maintain a system that allows for continuance of voluntary employer-provided health benefits
• Avoid codification of specific mandates that interfere with effective plan design and administration
• Encourage better comprehensive information and communication with employees about benefits and coverage
• Maintain patient confidentiality without impeding effective plan administration

The efforts to actively legislate what has always been a voluntary system of employer-provided benefits will likely result in increased administrative and claim costs and intensified government regulation. Because the decision by employers to provide employee health insurance benefits is voluntary, increased costs and layers of regulation will encourage employers to discontinue or reduce benefits, or pass along additional expenses to the individual, thereby forcing their employees to buy coverage individually or to join the already growing ranks of the uninsured. RIMS believes that additional federal mandates imposed on a voluntarily provided benefit interfere with the employer’s ability to meet the benefit needs of its employees effectively and efficiently. Mandates remove flexibility, impinging on employer and employee choice of benefits and costs. Employers should be permitted to work with employees to determine their own, specifically tailored and acceptable mix of coverage at a price all are willing to pay.

RIMS is most concerned that exposing employers to litigation poses the most serious threat to their voluntary health care plans. However, we do recognize the need to protect employees from unreasonable denials of coverage. RIMS favors proposals requiring plans to provide a formal internal appeal process rather than those that would pass medical malpractice liability back to the employer. Employers provide health insurance, not health care. To impose liability for such a transfer of responsibility places benefit plans at risk. Some legislative proposals allow internal appeals for adverse coverage decisions followed by external review only in certain circumstances. In such proposals, only if the plan fails to provide benefits determined appropriate by the appeals process does the aggrieved participant have a claim for a civil penalty in court. RIMS supports measures that aim to resolve disputes without litigation. Such an approach supports other legislative efforts to create incentives for alternative dispute resolution procedures, rather than filing more cases in an already overtaxed court system. In cases, where litigation is allowed, liability for coverage decisions should be subject to reasonable limitations.

RIMS recognizes the need for plan participants to have due process, the objective appeal of a plan’s administrative decisions, and, therefore, supports the internal and external review process outlined in such bills as HR 448. The proposal permits states to enact legislation placing higher or lower liability limits than those proposed at the federal level. The needs of the insured public would be better served, however, if Congress established a uniform limit on liability for plans regulated by ERISA.

RIMS is also concerned about the "medical necessity" provisions of Dingell-Norwood. With the protection of a reasonable appeals process, it is appropriate to use a health care plan’s definition of medical necessity as the reference point for review. RIMS favors the Senate’s approach to the issue of medical necessity.

Just as RIMS members have a vested interest in health benefit plans that keep employees healthy and productive, they also hope to avoid the creation of new litigation exposures. RIMS members seek solutions that provide patient care in hospital rooms, not courtrooms. They seek solutions that offer choice, not mandates. Every effort should be made to keep our system of employer, voluntarily provided health benefits just that, voluntary. Existing state mandates, overlapping with federal mandates, have led to dual regulation of health insurance, which can only lead to confusion and inconsistency. That is a result that is not in the best interest of RIMS membership or its employees.

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The Risk and Insurance Management Society, Inc. (RIMS) is a not-for-profit organization dedicated to advancing the practice of risk management, a professional discipline that protects physical, financial and human resources. Founded in 1950, RIMS represents over 4,000 industrial, service, nonprofit, charitable and governmental entities. The Society serves more than 7,500 individuals representing our member companies/organizations in 88 chapters across the United States and Canada.