Has the administration caved on contraception?

Last Friday I wondered how the administration's contraception compromise, which mandates that health insurance companies, rather than the employers who hire them, pay for contraception, would apply to self-insured health plans, where there is no outside insurer, only a third-party administrator (TPA) and sometimes a stop-loss insurer to cover highly expensive treatment. 

Now HHS Secretary Sebelius says that self-insured plans will be "exempted." What exactly does that mean? Here's the Washington Times*:

Updated: Will self-funded plans have to offer contraception?

I'm reposting this 2/10 post, shortened somewhat, to highlight a couple of updates tacked on this week:
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I have a really basic question about the just-announced compromise regarding insurance coverage for contraception. Under the compromise,

• Religious organizations will not be required to subsidize the cost of contraception.

• Contraception coverage will be offered to women by their employers’ insurance companies directly [and free of charge], with no role for religious employers who oppose contraception.

Question: more than half of Americans who get their health coverage from their employers are in self-funded plans -- that is, plans in which the employer sets aside funds to cover the cost of health care, usually hiring a third party administrator (TPA) to handle the claims process, as well as a stop-loss insurer to cover costs above a certain level.  So: who will "provide contraception coverage" in self-funded plans?   If it's the self-funded entity, then the employer is paying for it. Would the TPA somehow absorb the cost -- or a stop-loss insurer under some special rider? If so, surely either would find a way to pass the cost back?


UPDATE 2/14: At Business Insurance, Jerry Geisel relays this clarification-to-come notice:

In regulations issued Friday [Feb. 10], the administration said it will develop a comparable rule that would apply to employers affiliated with religious organizations that self-fund their health care plans.

“The departments intend to develop policies to achieve the same goals for self-insured group health plans sponsored by nonexempted, nonprofit religious organizations with religious objections to contraceptive coverage” according to regulations released by the Internal Revenue Service and the Departments of Labor and Health and Human Services.

For now, “I see a gaping hole” on the self-insurance issue, said Andy Anderson, a partner with Morgan, Lewis & Bockius L.L.P. in Chicago.

UPDATE 2/15:  NPR's Jim Zarroli cites an industry expert who assumes that for self-funded plans, "the insurance company" footing the bill would be the third party administrator (TPA):

The invisible 1/3 of U.S. health care funding

Trickling through news reports and blogs are 2008 census figures showing an accelerating shift away from employer-based and toward government-supplied health insurance. Employers in 2008 covered just 58.5% of Americans, down from 59.3% in 2007 and 64.2% in 2000.

What's often not noted in the health care debate is a parallel shift by employers from providing traditional insurance, supplied by an insurance company, to providing self-funded health care plans, generally administered by an insurance company or other "third party administrator" (TPA) and backed by catastrophic "stop-loss" insurance.

More than half of Americans who get their health coverage from their employers are in self-insured plans (the last figure I remember seeing is 55%), which are not subject to state mandates. There are more people whose health care is funded directly by their employer than by government plans, and almost as many as are insured by private health insurers (whether employer-provided or purchased directly).

Per the numbers below, presented by the Council of Economic Advisor's Cecilia Rouse and flagged by Ben Smith, little more than one third of Americans are covered by traditional private, third-party health insurance plans (a bit less than half of the 58.5% with employer-based coverage, plus approximately 9% who buy insurance directly).

Some questions worth answering: how does employer-funded health care stack up against traditional private insurance? How successful are employers at controlling costs -- are they completely in the hands of their TPAs? What percentage of health insurers' income comes from administering companies' self-funded plans, or from providing stop-loss to self-funded companies? To what extent will new health care legislation regulate employer-funded benefits? In addition to providing health insurers with a new pool of subsidized shoppers, will health care legislation offer them new opportunities to act as administrators?