Todd Irons
(202) 973-2927
Suzy DeFrancis
(202) 973-3610
Deanna Johnson Keim
(202) 289-6700

New Dingell-Norwood Bill Exposes Employers to Even Broader Liability

New Study Confirms Employers Are Not Protected from Unlimited Lawsuits

Washington, DC, September 19, 2000 — The Health Benefits Coalition today released a study of the revised Dingell-Norwood bill that shows employers would still be subject to unlimited lawsuits, and their exposure to liability would actually be worse than under the original bill. The analysis was prepared by the Groom Law Group and commissioned by the Association of Private Pension and Welfare Plans, an employer organization and member of the Health Benefits Coalition.

"Like a terrible sequel to a bad movie, the Dingell-Norwood bill keeps getting worse with each new production," said Jim Klein, President of the Association of Private Pension and Welfare Plans. "But while a bad movie sequel is over once the credits roll, employers will face the frightening possibility of new, unlimited lawsuits for years to come if this bill becomes law."

According to the analysis, the revised Dingell-Norwood bill exposes employers to virtually all the same suits allowed under the original legislation, but with even fewer limits on liability. For example:

  • In addition to creating a far reaching set of federal and state personal injury suits that are nearly unlimited and cover any claim for benefits, the legislation also allows new federal suits relating to plan administration.
  • For the first time, the new bill allows personal injury lawsuits for even simple errors in the administration of the COBRA continuation of coverage requirements, and the preexisting conditions limitations established in the Health Insurance Portability and Accountability Act (HIPPA).
  • It allows unlimited compensatory and punitive damages under both federal and state law.

The expanded liability provisions in the latest Dingell-Norwood proposal would force many employers, especially small businesses, to stop offering health care coverage to their employees rather than face the risk of a ruinous lawsuit. Even if they are not sued directly, employers and their employees will still face higher costs resulting from the flood of new lawsuits into the health care system. Either way, if this bill passes more than a million people would lose their insurance (CBO, Lewin Group).

For a copy of the 17-page study please call one of the contacts listed above.

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The Health Benefits Coalition is a broad-based organization representing three million employers providing health care coverage to more than 100 million employees and families. The coalition believes affordable, quality health care is best achieved through broader coverage, choice and competition in the marketplace – not government mandates.