When Congress created the Employment Retirement Income Security Act in 1974 (ERISA), the stated intention was to “protect…participants in employee benefit plans and their beneficiaries…by establishing standards of conduct…and by providing for appropriate remedies.” Basically, the law was supposed to make things better for people in big group health plans by demanding that they all follow the same federal rules.
While they certainly knew that ERISA regulations would cover a lot of people, they still meant for there to be plenty of non-ERISA plans. Unfortunately, the people who actually wrote the language of the law made it so vague that today practically everyone getting insurance through their employer is governed by ERISA – and the vast majority of people in our country are insured through their work. Though plans that aren’t covered by ERISA do exist, they are incredibly few and far between.
What Kinds of Plans Aren’t Covered By ERISA Law?
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Anyone who has had to file a claim on a plan governed by ERISA knows that the rules “protecting” them are weak at best. If your insurer denies your claim and you have to fight back, you won’t be able to go to state courts and you won’t have any of the protections provided by state laws – ERISA is your only “help.”
So, who’s lucky enough to have a plan not covered by ERISA? People with individual insurance plans, anyone on federal or state plans like Medicare and Medicaid or, those insured through exempt organizations like churches. And that’s it.
As of January 1, 2003, after new regulations were passed, there were around 130 million Americans covered by the weaker laws of ERISA simply because they got their insurance from their job. Subtract the millions of uninsured Americans and you can easily see that the vast majority of people in our country are not only being denied protections they deserve, but also covered by rules they don’t understand. If you have to file an ERISA lawsuit, make sure you work with an attorney well-versed in the regulations.
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