Health care – it’s about the cost

(March 20, 2008) Why doesn’t everyone have health insurance? For most who don’t, the answer is simple — because it’s too expensive.

And this is where state lawmakers should focus — reducing the cost of health care to make it more affordable and accessible. Concentrating on who pays for it, as some proposals are trying to do, misses the point.

It’s also troubling that other proposals would either drive up the cost of health insurance or compromise the state’s health insurance rules that have protected individuals and businesses alike, especially small businesses.

Right direction — focus on cost:
Plans with fewer mandates
Many lawmakers understand that the numerous health benefit mandates adopted year after year have driven up the cost of health insurance. Unfortunately, it has driven up the cost for those who can least afford it — people purchasing health care in the individual market and small companies. But HB-5721 and HB-5709 would allow for the sale of health insurance plans with fewer mandates than otherwise required by law, allowing these plans to be sold at a lower cost.

Helping municipalities
Another positive proposal would remove the obstacles in the way of cities and towns that want to collaborate to purchase health insurance. HB-5710 would allow these municipalities to form Multiple Employer Welfare Arrangements (MEWAs) and purchase health insurance they can manage in an effort to lower their health care costs.

This would benefit the business community because reduced municipal health care costs would mean lower property taxes, which have troubled companies for years.

And unlike other “pooling” proposals being floated this year, HB-5710 would let municipalities retain control over negotiating their own benefit levels and plan designs. Municipalities have been more effective than the state at controlling their costs. It only makes sense that lawmakers acknowledge this by permitting the municipalities to use this newly requested tool.

Wrong direction:
Playing outside the rules
One proposal (HB-5536) would open the state employee health plan to small companies and municipalities. Unfortunately, this new pooling program would operate outside of Connecticut’s health insurance rules and would lock participants in for at least three years.

This is a problem because the rules — such as guaranteed issue, guaranteed renewability and adjusted community rating — have helped protect the small group market. And many if not most small companies shop their health care each year in an effort to control their costs — which locking them in for three years won’t allow them to do.

Cost-Drivers
As many policymakers try to make health care more affordable, competing efforts to increase the cost of health insurance are also being considered. These proposals either add to the already enormous list of cost-driving health benefit mandates or shift health care costs by prohibiting copayments for certain services onto the rest of health care consumers.

As the legislative session is now at the midpoint, CBIA encourages the legislature to stop measures that would send Connecticut in the wrong direction and help us by adopting measures that will aid us.

For more information, contact Eric George at 860-244-1921 or eric.george@cbia.com.