WSJ Almost Uniquely Raises Self-Insurance Issue in 'Immaculate Contraception' Editorial

February 11th, 2012 9:54 AM

Yesterday's announcement by President Obama (headlined at the White House's website as "Remarks by the President on Preventive Care") of planned revisions to an ObamaCare-driven rule which, in the President's words, "if a woman’s employer is a charity or a hospital that has a religious objection to providing contraceptive services as part of their health plan, the insurance company -– not the hospital, not the charity -– will be required to reach out and offer the woman contraceptive care free of charge, without co-pays and without hassles."

Showing just how out of touch the establishment press is with reality, an editorial this morning in the Wall Street Journal cutely titled "Immaculate Contraception" points out something most, including the Associated Press, have missed -- that in a large number of cases involving many thousands of employees, there is no "insurance company" there to directly pay for these services:

One major problem will be how the rule applies to large organizations that self-insure. Arrangements in which an employer pays for care directly and uses insurers to manage benefits and process claims (not to take on insurance risk) account for the majority of the private market. In these cases there isn't even a free lunch to pretend exists.

The only insurance involved in self-insurance situations is "stop-loss" coverage which kicks in at very high levels (often $100,000 or more) on particularly costly individual claims (e.g., heart attacks, cancer, etc.). If this insurance weren't available, such claims could financially cripple or bankrupt self-insured enterprises.

Many stop-loss carriers don't have departments or affiliates which manage routine claims, and thus would not even have the capability of administering "free" contraceptive coverage. So who would? Maybe we can see if the Tooth Fairy, Santa Clause, or the Easter Bunny might want to step up. (/sarc)

It turns out that the very reason many religiously-affiliated entities self-insure is that some states have imposed what ObamaCare wants impose nationally. They are already forcing employers with health insurance plans to cover contraception (a term whose use is in fact misleading, as coverage typically includes forms of "birth control," which should also be known as "birth prevention," which induce abortion shortly after fertilization occurs, i.e., they aren't forms of "contraception," they eliminate preborn babies after conception).

In today's New York Times, Joseph Berger and Thomas Kaplan transparently attempt to show that the President's announcement yesterday was really no big deal because of these already-existing state mandates. But they note at several points that Catholic institutions have self-insured to avoid the state-sponsored coercion:

... Some New York Catholic institutions — including the Archdiocese of New York, led by Archbishop Dolan, and the Diocese of Brooklyn — chose to self-insure rather than pay for contraception after New York State adopted a requirement in 2002 that any insurance policy with a prescription drug benefit provide coverage for birth control.

... One of the most contentious laws was approved in California in 1999; the measure effectively provided an exemption to churches but not to religiously affiliated hospitals, universities or social service organizations. Catholic Charities of Sacramento unsuccessfully challenged the law in court.

“It was pretty much a useless exemption, because the large employers are not churches,” said Carol Hogan, a spokeswoman for the California Catholic Conference. She said many large Catholic institutions in California, like hospitals, have since elected to sidestep the law by insuring themselves.

“The bishops knew going forward that that was their backup plan,” Ms. Hogan said. “That didn’t negate the fact that it was a violation of religious liberty.”

In New Jersey, which enacted a requirement on contraceptives in 2006, a number of religiously affiliated hospitals have also opted for self-insurance.

Still totally unaddressed: Religious believers who happen to be small, private-sector employers. Why will they being forced (and in some states, why are they already being forced) to cover something which they believe is morally repugnant and sinful? I'm sorry, being forced to sell out your beliefs should not be a price you have to pay for going into business and taking on employees. It may be a very minor factor in the grand scheme, but add it to the list of reasons why certain entrepreneurs with great ideas might decide not to expand beyond their core founder group, or why they refuse to take on employees above the levels where related legislative exemptions no longer apply. As with other coercion of employers in so many other areas, that's not good for economy.

Demonstrating how mostly clueless the national press is on the relevance of self-insurance:

  • A search at the Associated Press's national site on "contraception self-insurance" (not in quotes) returned nothing relating to yesterday's presidential announcement.
  • An AP national site search on "contraception self-insure" (not in quotes) returned one item, a quote from Mat Staver at Liberty University raising the self-insurance question. Even after Staver dropped it in their laps, nobody at the self-described Essential Global News Network has seen that the self-insurance issue might be important.
  • Google News searches for the past 24 hours on "contraception self insurance" and "contraception self-insure" (each not in quotes) done at 9:30 a.m. returned four and 47 results, respectively. There are perhaps a half-dozen to ten items which might be seen as national establishment press outlets.

The searches revealed that U.S. bishops have officially weighed in. I'll be posting on that shortly.

Cross-posted at