Understanding the Law So You Can Win the Coverage You Deserve — Without Being Misled
What Is ERISA, Really?
ERISA — the Employee Retirement Income Security Act — is the federal law that governs most employer-sponsored benefit plans, including health insurance. It was enacted in 1974 to protect employee benefits, not to allow surgeons to get paid. Many medium to large employers are “self-funded” so they are paying a portion of your surgery costs, and can be helpful if the focus is actually on high-quality and cost-effective care.
Over time, ERISA’s healthcare provisions have evolved through federal regulations and the Affordable Care Act (ACA). Together, they outline how coverage decisions must be made, how patients access care, and what appeal rights exist when a claim is denied.
Unfortunately, some advocates and even providers misuse ERISA as a catch-all means to try to force insurance companies to pay for lipedema surgery. They imply to patients that, under ERISA, you can pay cash and be fully reimbursed. That’s a fallacy—and a convenient one that only benefits cash-pay surgeons and the advocates who enable them, not lipedema patients.
Does ERISA Apply to Every Health Plan?
Absolutely not. ERISA applies to employer-based health plans. It does not apply to:
- Individual marketplace plans
- State or county-based public plans
- Medicaid or Medicare
- Federal employee health plans
Those plans, as well as some smaller employer-based plans, fall under state or other federal laws, which vary widely. Even within ERISA-covered plans, key provisions on access, payment, and appeals are derived from ACA-based regulations that have significant gaps.
The Truth About the SPD — Your Plan’s Rulebook
Every ERISA and most non-ERISA plans have a Summary Plan Description (SPD) — a dense document (often 75–150 pages) that defines coverage, exclusions, and your rights to appeal.
At LCC, we’ve reviewed thousands of SPDs. Here’s what we’ve learned:
- Liposuction is rarely excluded, and “skin excisions” (like tummy tucks after lipedema surgery) are often covered when reconstructive, not cosmetic.
- Only board-certified plastic surgeons can perform skin excisions, which is why exclusions sometimes appear when non-plastic surgeons submit claims.
- Insurers frequently misread their own SPDs, denying reconstructive surgery as “cosmetic.”
- UHC and UMR almost always cover liposuction when it’s reconstructive — claims to the contrary are false and show inexperience in interpreting SPDs.
We don’t “appeal” misreadings that delay care for months — we cite the exact SPD provisions in the preauthorization request and push for a correct decision upfront.
And if an SPD truly has problematic exclusions, employers themselves can fix them. Major employers like Wells Fargo already have — once they understood that liposuction is a reconstructive medical necessity for lipedema, not a cosmetic choice.
Fallacy: “ERISA Requires the Insurer to Grant a Network Exception”
Reality: ACA requires that there be access to network providers without unreasonable delay, but ERISA doesn’t even address network exceptions, and insurers can simply state that members can use their “out of network” benefit.
Even if reaching a network provider is delayed, insurers will often continue to suggest those who might be willing to treat lipedema. The further you want to travel for surgery, the more providers they can name. It can take hours to rule out providers, and in-person consultations may even be required. Even in patient-friendly states like California, regulators have ruled that one in-network surgeon (even if they have treated only a few lipedema cases) is technically sufficient.
That’s why appealing a denied network exception often fails. The appeal may land on the desk of an older plastic surgeon reviewer who’s never seen a lipedema case and assumes large-volume liposuction is unsafe.
The smarter path? Engage insurers, employers, and regulators directly — outside the formal appeal process — to negotiate access. We keep an extensive database of network providers who either don’t treat lipedema or are less effective at treatment. Many insurers know that many are unable or unwilling to treat lipedema already, but often need reminding, and engaging employers and regulators helps them act reasonably. Once they understand the lack of qualified network providers, many will authorize network exceptions. Cooperation, not conflict, is key to preserving your relationship with your employer, too. We have even seen cases where jobs have been lost due to greedy claims submitted by surgeons to self-funded plans.
And as awareness grows, many Fortune 500 employers now have at least one employee with lipedema — so the conversation is no longer new to them.
Fallacy: The SPD Guarantees Fair Payment
Not even close.
ERISA does not require insurers to pay surgeons fairly. The SPD language is intentionally vague — and almost always written in the insurer’s favor. Some insurers, such as CIGNA and sometimes Anthem, will easily grant a network exception, knowing they have no intention of paying claims fairly, especially for patients with later-stage lipedema.
Here’s what SPDs typically say:
- Payment is based on “negotiated rates” or “the lowest amount allowed.”
- The plan may, but is not required to, negotiate with non-network providers.
- “Reasonable and customary” means whatever the insurer says it means for that ZIP code.
In practice, insurers use outdated fee schedules — paying only a few thousand dollars for surgeries that cost $20,000–$30,000 and last four to six hours.
That’s why paying cash up front can be a costly mistake.
The right strategy is to secure both:
- A Network Gap Exception (so your out-of-network surgeon is treated like in-network and you receive your in-network benefits), and
- A Single Case Agreement (SCA) that locks in payment terms.
Without both, insurers can “approve” your surgery but still pay a fraction of the actual cost.
Fallacy: You Can Appeal for Fair Payment
In theory, you can — in practice, it’s almost impossible to win.
Regulators, both federal and state, avoid payment disputes. Even states like California, New York, and Virginia have said they won’t intervene in payment negotiations.
The Department of Labor’s Employee Benefits Security Administration (EBSA) — which oversees ERISA — can’t force insurers to pay fairly. EBSA complaints go to the employer, not the insurer, so suing the employer is not a good strategy versus talking with them about the options as we have done for years in securing hundreds of single-case agreements for members.
Even FAIR Health, the database created after New York sued insurers for underpaying, isn’t mandatory — not even in New York. Plus, the payments listed in FAIR Health are often based on low amounts for typical CPT codes that represent short-duration, limited procedures, not much longer lipedema surgeries.
Sometimes, we fail to win favorable out-of-network terms, but then we help otherwise approved patients connect with a network plastic surgeon who is also focused on lipedema. Surgeons who encourage you to use “out of network” benefits or offer a cut rate for the first surgery and bill insurance later are not protecting you and might not be committed to continuing your care if they cannot be paid by insurance.
So what does work?
- Data, experience, and relationships.
- Showing insurers and employers that fair rates protect patients and reduce legal exposure.
- Encouraging surgeons to accept reasonable payments (e.g., $25,000 per surgery vs. $45,000) to maintain goodwill with the insurers and expand access.
When handled strategically, this approach leads to more consistent results — and more women getting safe, effective, and fully covered surgery without going into debt.
The Bottom Line: You Don’t Need False Hope.
ERISA is a framework — not a magic wand.
It doesn’t guarantee access, fairness, or speed. But it can work for you when you understand how to navigate it intelligently:
- Know your SPD better than the insurer does.
- Engage insurers, regulators, and employers as allies, not adversaries.
- Push for network exceptions and SCAs, not risky appeals.
- Leverage expertise — not social media myths.
Because when the system fails women with lipedema, it’s not ERISA’s fault — it’s the misuse of ERISA by those who benefit from confusion. For this reason, we caution lipedema patients to be wary of surgeons who refer their patients to ERISA-focused advocates.
At LCC, through advocacy and education, we turn confusion into clarity — and denials into approvals.