July 21, 2006
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"Fair Share" Healthcare Struck Down by the Courts
At the start of this legislative session, Representatives Amy Rice (D-Portsmouth/Middletown/Newport), Arthur Handy (D-Cranston), Raymond Sullivan (D-Coventry/West Greenwich), Joseph Faria (D-Central Falls), and Joseph Almeida (D-Providence) introduced a bill that would have required corporations with 1,000 or more people to either pay a fixed percentage of payroll for their employees health care, or pay into a state health insurance fund. The bill was passed by the Rhode Island House (H6917) but failed to pass the Senate (S2201).
Even had the bill been approved, it probably would have never taken effect. A Federal Court on Wednesday nullified a similar law passed by the Maryland legislature on the grounds that it conflicted with the section of the Employment Retirement Income Security Act of 1974 (ERISA) prohibiting states from regulating employer-sponsored benefit plans, including health insurance plans, any more stringently than the Federal government does. The decision will probably be appealed, but the courts have been very consistent in interpreting ERISA to mean that states cannot impose health coverage mandates on employers.
These so-called "Fair Share" plans (Maryland's, Rhode Island's, or any other state's versions) weren't good ones. They avoided any introspection about why problems with healthcare delivery have reached crisis proportions; they were typical of the big-government mentality that holds that if we can't be imaginative enough to facilitate something good for citizens, at least we can force everyone into something equally bad.
A better solution for improving healthcare delivery in America is to allow people more healthcare choices by 1) introducing health savings accounts 2) by decoupling health insurance from employment (by allowing individuals the same tax-breaks for buying health insurance that corporations get for offering it AND by eliminating the noxious provision of ERISA that protects insurance companies that provide employer-sponsored insurance from responsibility for the consequences of poor medical decisions they make and 3) by reducing the over-regulation of health insurance so companies can offer a range of coverages and deductibles tailored to meet individual needs.