Self-Insurance Protection Act

The Self-Insurance Protection Act would amend ERISA to clarify that certain medical stop-loss insurance, obtained by self-insured group health plans or their plan sponsors, is not considered health insurance coverage under the statute. In simple terms, stop-loss policies—which are used to protect plan sponsors from very high, unexpected claims—would not count as health insurance, and thus would be subject to different regulatory treatment than traditional health insurance. The bill also strengthens federal preemption by adding a clause to ERISA that would prevent state laws from blocking or restricting the availability or use of stop-loss insurance for self-funded plans. The overall aim is to make stop-loss coverage more available and predictable for self-funded plans by reducing state regulatory barriers and clarifying its non-health-insurance status under ERISA.