Many Indiana Employer Health Plans Requiring Insurers To Cover Workers' Adult Children

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An Indiana state law that took effect July 1 and requires healthinsurers to cover policyholders' children until age 24 "surprisedIndiana lawmakers" and residents by leaving certain employer plansexempt from the law because their plans are exempt from stateregulation, the Indianapolis Starreports. The measure was part of legislation that increased the state'scigarette tax to fund health programs. According to state Rep. CharlieBrown (D), the legislation was approved close to the end of the GeneralAssembly's session, and legislative services did not have much time toresearch the provision.

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Carol Cutter, chief deputy of health and legislative affairs for the Indiana Department of Insurance,said the state law applied only to employer plans that are "fullyinsured," meaning the employer pays premiums to an insurer. Self-fundedplans offered by employers, meaning the employer pays its own medicalexpenses and often uses insurers to administer the benefits, areregulated solely under the federal Employee Retirement Income SecurityAct and are exempt from the state law. Most labor unions' health plansare regulated through ERISA, and according to the Star, as many as half of Indiana's businesses have self-funded health plans.

Brownsaid lawmakers were "unaware" of the issue "at the time" thelegislation was approved, adding, "The intent was that we would get asmany 24-year-olds and younger on some kind of plan." Brown said he hassent letters to the Indiana Manufacturers Association and the Indiana Chamber of Commerceurging them to voluntarily insure workers' children between the ages of18 and 24. Brian Burton, vice president of IMA, said the decision wouldbe up to members on an individual basis (Lee, Indianapolis Star, 7/17).
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