JJ Conway
J.J. Conway Law
J.J. Conway Law
Election season is upon us. Political signs are on the lawns. Billboards and media ads are everywhere. Candidates crisscross the country making their appeals and attacking each other. This year, like all election years, has seen ideas tossed out to the public for consideration. Paid medical leave. Paid childcare benefits. IVF treatments at no cost.
If any of these campaign ideas were to come into legal existence, how will it happen? Well, a good place to look is the Employee Retirement Income Security Act of 1974, or ERISA.
When ERISA is cited in legal briefs and opinions, it is often followed by the words “as amended.” This is a kind of unique wording among benefits practitioners since other cited statutes often don’t reference their amendments. Those two words – as amended – cover a lot of ground. In fact, the amendments to the ERISA statute are seemingly outpacing its original provisions.
ERISA was enacted to protect pensions. As a statute that federalized the law of benefits for the private sector, it followed that ERISA’s regulatory reach would eventually cover all benefit plan offerings, healthcare, disability, life insurance, and the like. With that framework in place, amendments to the act could follow and the law’s reach could be expanded.
As an example of this, ERISA served as the foundational statute allowing for the implementation of COBRA benefits to be provided. The word “COBRA” has nothing to do with healthcare coverage. The law, itself, was a budget act, i.e., the Consolidated Omnibus Budget and Reconciliation Act of 1986. But the continuation of health coverage and the penalties that were used to enforce that right appeared as an amendment to the ERISA statute. The national reach of the law was such that during the Reagan Administration, COBRA could be enacted to cover group health plans and prevent the loss of health insurance following a job loss. Failing to follow COBRA subjected employers to penalties that were enforced under ERISA’s Section 502(c), 29 U.S.C. 1132(c). Such COBRA penalties were to be established by the U.S. Department of Labor and would rise over time consistent with the Consumer Price Index.
Similarly, the Mental Health Parity Act of 1996 - which itself did not create a private right of action for those it was meant to help - was made enforceable through another amendment to ERISA. When the law was updated and revised in 2008 to set forth greater protections for substance abuse treatment, among other things, ERISA was amended, again, through the Mental Health Parity and Addiction Equity Act of 2008.
The Patient Protection and Affordable Healthcare Act – which is perhaps the most dramatic amendment to ERISA’s statutory provisions since the passage of the law itself– again omitted a private right of action but allowed for its enforcement through ERISA’s statutory provisions. The ACA also transformed the offering of healthcare benefits to employees from being a discretionary act by an employer to one that was mandatory for employers of a certain size.
These changes to the law began as campaign promises. Often, they were promises made over several campaigns (think President Bill Clinton and healthcare reform in 1992 to its passage in 2010 under President Barak Obama). In 1986, President Reagan signed one of the largest compromise budgets of all time. It established COBRA protections, but it continued a number of tax policy changes that his administration had campaigned on in 1984.
What lies ahead? It is anyone’s guess. ERISA provides a ready-made federal platform for all sorts of changes like paid child leave, paid daycare benefits, educational reimbursements, and sabbatical income benefits. The voting public seems comfortable with certain of these ideas being made a part of their federal rights, and, as such, they are comfortable with more amendments yet to come.
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John Joseph (J.J.) Conway is an employee benefits and ERISA attorney and litigator and founder of J.J. Conway Law in Royal Oak, Michigan.
If any of these campaign ideas were to come into legal existence, how will it happen? Well, a good place to look is the Employee Retirement Income Security Act of 1974, or ERISA.
When ERISA is cited in legal briefs and opinions, it is often followed by the words “as amended.” This is a kind of unique wording among benefits practitioners since other cited statutes often don’t reference their amendments. Those two words – as amended – cover a lot of ground. In fact, the amendments to the ERISA statute are seemingly outpacing its original provisions.
ERISA was enacted to protect pensions. As a statute that federalized the law of benefits for the private sector, it followed that ERISA’s regulatory reach would eventually cover all benefit plan offerings, healthcare, disability, life insurance, and the like. With that framework in place, amendments to the act could follow and the law’s reach could be expanded.
As an example of this, ERISA served as the foundational statute allowing for the implementation of COBRA benefits to be provided. The word “COBRA” has nothing to do with healthcare coverage. The law, itself, was a budget act, i.e., the Consolidated Omnibus Budget and Reconciliation Act of 1986. But the continuation of health coverage and the penalties that were used to enforce that right appeared as an amendment to the ERISA statute. The national reach of the law was such that during the Reagan Administration, COBRA could be enacted to cover group health plans and prevent the loss of health insurance following a job loss. Failing to follow COBRA subjected employers to penalties that were enforced under ERISA’s Section 502(c), 29 U.S.C. 1132(c). Such COBRA penalties were to be established by the U.S. Department of Labor and would rise over time consistent with the Consumer Price Index.
Similarly, the Mental Health Parity Act of 1996 - which itself did not create a private right of action for those it was meant to help - was made enforceable through another amendment to ERISA. When the law was updated and revised in 2008 to set forth greater protections for substance abuse treatment, among other things, ERISA was amended, again, through the Mental Health Parity and Addiction Equity Act of 2008.
The Patient Protection and Affordable Healthcare Act – which is perhaps the most dramatic amendment to ERISA’s statutory provisions since the passage of the law itself– again omitted a private right of action but allowed for its enforcement through ERISA’s statutory provisions. The ACA also transformed the offering of healthcare benefits to employees from being a discretionary act by an employer to one that was mandatory for employers of a certain size.
These changes to the law began as campaign promises. Often, they were promises made over several campaigns (think President Bill Clinton and healthcare reform in 1992 to its passage in 2010 under President Barak Obama). In 1986, President Reagan signed one of the largest compromise budgets of all time. It established COBRA protections, but it continued a number of tax policy changes that his administration had campaigned on in 1984.
What lies ahead? It is anyone’s guess. ERISA provides a ready-made federal platform for all sorts of changes like paid child leave, paid daycare benefits, educational reimbursements, and sabbatical income benefits. The voting public seems comfortable with certain of these ideas being made a part of their federal rights, and, as such, they are comfortable with more amendments yet to come.
—————
John Joseph (J.J.) Conway is an employee benefits and ERISA attorney and litigator and founder of J.J. Conway Law in Royal Oak, Michigan.
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