State or Federal Jurisdiction for Some Health Plans
Some types of insurance or insurance products are not under state jurisdiction. For example, if you have health insurance through your employer that is self-funded (the employer provides health or disability benefits to employees and assumes the direct risk for payment of claims), this type of insurance is called an ERISA plan and is under the jurisdiction of the Federal Government. Generally, under this type of plan, the employer hires an insurance company to act as a “third-party administrator” for the employer’s health care plan, providing claims processing but not accepting any risk.
ERISA plans must still meet certain guidelines, such as detailing how a person appeals a denial of benefits. If you are unsure if you have employer self-funded insurance, ask your employer or call the Colorado Division of Insurance for more information.
ERISA exempts self-funded health care plans from state insurance regulation. Therefore, when you need assistance or want to make a complaint about services, you need to contact your human resources department or the U.S. Department of Labor. The Colorado Division of Insurance will be glad to assist you with questions you may have, but may not have jurisdiction over matters we do not regulate.
The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that sets minimum standards for most voluntarily established pension and health plans in private industry to provide protection for individuals in these plans.
ERISA requires plans to provide participants with plan information including important information about plan features and funding; sets minimum standards for participation, vesting, benefit accrual and funding; provides fiduciary responsibilities for those who manage and control plan assets; requires plans to establish a grievance and appeals process for participants to get benefits from their plans; gives participants the right to sue for benefits and breaches of fiduciary duty; and, if a defined benefit plan is terminated, guarantees payment of certain benefits through a federally chartered corporation, known as the Pension Benefit Guaranty Corporation (PBGC).
In general, ERISA does not cover retirement plans established or maintained by governmental entities, churches for their employees, or plans which are maintained solely to comply with applicable workers compensation, unemployment or disability laws. ERISA also does not cover plans maintained outside the United States primarily for the benefit of nonresident aliens or unfunded excess benefit plans.