National Coalition on Benefits
This article is part of the Center for Media & Democracy's spotlight on front groups and corporate spin.
The National Coalition on Benefits is a front group created by CIGNA and other big, for-profit insurers and other big U.S. employers to fight any attempt to change the Employee Retirement Income Security Act of 1974, also known as ERISA, passed by Congress to protect employees' pensions.
Why do big insurers want to protect ERISA?
Because the law keeps consumers from suing them for denying treatments or procedures.
ERISA requires employers to fund pension plans sufficiently to be able to pay out promised benefits when their employees retire. It also requires employers to keep retirement funds separate from other company funds and to hold them in a trust, so the funds will be protected even in the event that the company declares bankruptcy. The law was created because executives were stealing funds from employee retirement plans and leaving employees without any of their money when they retired. It sounds good, and Congress had good intentions when they passed the law, but over time, legal interpretations of the law have created problems that actually serve to protect big insurance companies.
Over the years, however, federal courts have ruled that ERISA applies not just to pension plans, but to all employee benefits, including health insurance plans. The problem is that the law does not apply only to the solvency of employee health insurance plans -- goes much further. Since it is a federal law, ERISA preempts many state insurance laws, leaving employee-sponsored health plans exempt from many state regulations designed to protect consumers from insurance company abuses. This leaves employee-sponsored plans essentially exempt from oversight by state insurance commissioners. In addition, more than 130 million employees in the U.S. who are enrolled in insurance plans covered by ERISA are prevented from suing their insurance company or employer in court if they are denied treatment or a procedure. They can try to sue in federal court, but potential remedies there are so limited that plaintiffs have difficulty even finding lawyers willing to take their cases. Few lawyers specialize in ERISA or are knowledgeable about how the law affects health benefits.
Some victims of insurance company abuses (like Hilda Sarkisyan, mother of Nataline Sarkisyan, a 17 year-old California girl who was denied coverage for a liver transplant by CIGNA) interpret ERISA as allowing companies to literally get away with murder.
Partial list of member companies
The National Coalition on Benefits' Web site give no fixed address. Contact is through Web form:
Donations are made to an individual at the
National Business Group on Health
20 F Street NW, Suite 200
Washington, DC 20001-6700
Phone: 202-558-3000 Fax: 202-628-9244
- Wendell Potter Deadly Spin: An Insurance Company Insider Speaks Out How Corporate PR is Killing Health Care and Deceiving Americans, Bloomsbury Press, November 2010, New York, New York, at pp 175-178
- National Coalition on Benefits About, organizational Web page, accessed December 25, 2010