The Indiana Court of Appeals has upheld the authority of the state’s insurance commissioner to levy an annual special assessment on several insurers selling stop-loss insurance to self-insured health plans operated under the federal Employee Retirement Income Security Act.

On June 29, the court upheld a lower court decision against a group of stop-loss insurers that sued to set aside millions of dollars in assessments to support the Indiana Comprehensive Health Insurance Assn., the state’s high-risk insurance pool, according to the decision in Avemco Insurance Co. et al. vs. Commissioner Sally Carty.

The plaintiffs, led by Hartford, Conn.-based Avemco, argued that, among other things, the insurance commissioner had exceeded her authority in ordering the assessments and that the assessments on stop-loss insurers were invalid and unenforceable. Avemco, for example, was assessed $1.1 million in November 2002.

The Self-Insurance Institute of America Inc. criticized the court decision.

George J. Pantos, counsel for the SIIA in Washington, said the group’s position is that stop-loss insurance purchased by self-insured plans is not health insurance, because payments are never made to individuals or for individual cases. The organization’s position, which it says is bolstered by 11 federal and state court rulings, is that it is inappropriate for any state to assess such insurers for state entities, such as high-risk pools, he said.

However, Mr. Pantos said legislation to allow similar assessments is pending in Georgia, Illinois and Ohio and has already been enacted in Louisiana, Mississippi and New Hampshire. Also, insurers are contesting a Colorado statute, he noted.