Washington, D.C., March 23, 2023 – The ERISA Industry Committee (ERIC) submitted a comment letter to the Texas House Insurance Committee urging members to oppose HB 2021, a bill that would violate federal law by allowing state legislators to interfere with the operation of multi-state employer-sponsored health benefits. The legislation, which received its first Committee hearing on March 22nd, attempts to expand state authority over pharmacy benefit managers (PBMs) to mandate the structure and design of self-insured employer-sponsored group health plans.
Notably, the bill would apply a range of requirements directly to all plans administered by a PBM, including self-insured plans governed by federal ERISA law. While states have continued testing their ability to regulate PBMs following the U.S. Supreme Court’s Rutledge decision, HB 2021 amounts to an overreach by the state in this area and should be defeated.
ERIC’s letter to the Committee explained in detail the advantages of self-funded employer plans, highlighted the importance of ERISA preemption, and outlined problematic provisions within HB 2021.
“Overall, HB 2021 would have a broad negative impact on the design and administration of health benefits, violating federal ERISA law, and inflating health insurance costs with various new mandates and requirements. If adopted, the bill would erode the ability of multi-state employers to effectively operate national, uniform benefit plans, and would lead to increased health care costs across the state Texas,” said James Gelfand, president of ERIC.