Recently, the Obama administration allowed religious affiliated businesses to be exempt from having to cover the cost of birth control in their employer sponsored health insurance plans. It has since become clear that some religious affiliated businesses are self-insured. This could be a problem.
Usually, when a business, company, or corporation decides to offer an employer sponsored health insurance plan, it seeks out an insurance company to help make that happen. The employer typically pays a certain amount of money to the insurer for this plan, (and that money often comes from each covered employee’s paycheck).
When an employee sees a doctor, that bill is sent to the insurance company. The insurance company decides how much of that bill it will cover. The remaining amount is billed to the employee.
Some business decide to become self-insured. This means that the business, company, or corporation decided to offer an employer sponsored health insurance plan, but chose not to seek out an insurance company to help make that happen. Instead, the business basically becomes its own insurance company.
When an employee sees a doctor, that bill is sent to the business (because it has decided to act as an insurer). The business is supposed to put money away so that it can pay for the medical care that is covered on the employer sponsored health insurance plan whenever an employee sees a doctor. Hopefully, the business has managed to put away enough money to properly cover the health care needs of its employees. The employer decides how much of a medical bill it wants to cover. The remainder of the bill is sent to the employee.
Recently, the Obama administration allowed religious affiliated businesses to be exempt from having to pay for the coverage of birth control in their employer sponsored health insurance plans. Instead, the insurance company that the Catholic hospital, religious university, or religious business works with will have to pay for those costs.
This plan works just fine for Catholic businesses who use an insurance company to facilitate their employer sponsored health plans. The problem is with the Catholic businesses that chose to self-insure. Those businesses have become their own insurance companies. Those Catholic businesses are now upset.
In short, the self-insured Catholic businesses feel that they are still being required to cover the cost of birth control in their employer sponsored health insurance plans. An obvious solution would be for those Catholic businesses to stop being self-insured, and choose an actual insurance company to facilitate their employer sponsored health insurance plans. Many Catholic business are not self-insured.
I don’t think that will be what the Catholic businesses who are currently self-insured choose to do, however. According to Michael Galligan-Stierle, president of the Association of Catholic Colleges and Universities, several Catholic organizations chose to self-insure specifically so that they could avoid having to comply with the requirements of state mandates that relate to health insurance.
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