Can employers vary benefits across workers?

I’m cleaning out the various cubbyholes where I stash ideas for blog posts. Here’s a bit of post fodder that had been sitting in my Gmail starred items since sometime late last year. I’m just dumping it on the web in rough form, not turning it into a full-blown post. If these notes are helpful to you, great. If you can add more, please do so in the comments.

I had asked Kevin Outterson and Paul Fronstin about the laws that prohibit employers from offering high- and low-compensation employees different health care benefits. Both told me that self-insured plans are prohibited by ERISA from offering better health benefits to highly compensated employees than those offered to other employees.  Additionally, the ACA limits the ability of employers to vary premiums across employee groups and includes a “non-discrimination rule” for fully-insured plans.

Paul Fronstin told me that there are often insurer-imposed minimum participation requirements in the small-group market which is an incentive for coverage to be provided to all employees.

Likely there are other state rules about these things, but I don’t know what they are or how widespread they are. Can some employers of some type(s) in some locations actually pick and choose who is offered health benefits and at what premium? Is that possible in America? If so where and how?



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