Who is Erisa, and why won’t she let me see a doctor?
One of the most maddening aspects of the nation’s current financial crisis is how many people saw the problems brewing, but were prevented from doing anything about it. Dozens of states acted over the years to ban the predatory lending at the heart of the mortgage crisis, only to have their laws pre-empted by the federal government. As Progressive States Network explains, the Federal Reserve both failed to implement federal legislation intended to rein in predatory lending and insisted that the existence of the federal law meant states couldn’t act on their own. Today we’re living with the results.
And we’re seeing something similar happen with health care. In 2006, Maryland passed a law requiring the state’s very largest employers to provide their employees with health coverage or pay into a state health fund. The law targeted Wal-Mart, which was raking in profits even as it advised employees to rely on the state Medicaid system for their medical needs. Courts struck down Maryland’s Fair Share for Health Care law arguing that it conflicted with ERISA, the federal law governing health and retirement plans. A similar thing happened in Nassau County, New York. Washington isn’t solving the nation’s health care crisis, but it is blocking states and cities from acting on their own.
But on this front we get a bit of good news in an otherwise gloomy week: a Federal Appeals court overturned a lower court ruling against San Francisco’s pioneering health plan.
The new verdict? Healthy San Francisco, which requires businesses with more than 20 employees to provide health coverage to employees or pay into a city fund that provides medical care at public and private hospitals does not violate ERISA. That means 25,000 San Franciscans who used to be uninsured can continue getting health care and the city can continue its efforts to sign up more residents. (For a really in-depth look at the city policy, click here) The ruling provides support for other states and cities to demand employer support for their own health plans. In the meantime, the Golden Gate Restaurant Association, which opposes the bill, may appeal all the way to the Supreme Court.
On health care, the real solution is federal action, not a patchwork of state and city laws. But whether it’s fair lending, health coverage, or regulations of dangerous consumer goods, the least we can do is give local governments the ability to solve problems where the federal government won’t. That means stopping the pre-emption of state and local laws except where Congress specifically states that pre-emption is intended. DMI Civil Justice Fellow Kia Franklin has more to say on that.