Employer Liability Provisions in Selected Patient Protection Bills

Publication Date: January 2003

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Labor

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Abstract:

The liability of a self-insured employer in state court for group health plan related actions is generally preempted by ERISA. However, an employer who acts as the administrator of the health plan can be liable for breach of fiduciary duty under ERISA. Some federal courts have also found self-insured employers liable under theories of vicarious liability and direct negligence. The extent to which employers can be found liable in any of these situations varies depending on the employer's level of participation in the administration of the plan and the plan's decision making process regarding claims for benefits.

In the various patient protection bills introduced in the 106th and 107th, Congress attempted to address the issue of employer liability by limiting liability to certain persons or circumstances. While both the House and Senate passed patient protection legislation in the 107th Congress, no agreement was reached with regard to the liability provisions in the bills and neither was sent to the President. This report provides an overview of the employer liability provisions of selected bills from both the 106th and 107th Congress, and will be updated as events warrant in the 108th Congress.