Kerry Wood: Commonsense Solutions for Connecticut Problems
The following article first appeared in the opinion pages of the Hartford Courant. It is reposted here with the author’s permission.
Almost every day, I hear from Connecticut small businesses, nonprofits, and families concerned about the rising cost of healthcare.
The fact is that most small businesses want to be able to provide this important benefit to their employees—employers recognize that offering quality, affordable healthcare is one of the best ways to attract and retain workers.
Not only that, but small businesses often view their employees as family, and they believe providing this benefit is simply the right thing to do.
Unfortunately, Connecticut’s small-group health insurance market is in crisis. Only four insurers are still serving the small-group fully insured market, and the cost of policies has risen dramatically.
As the co-chair of the General Assembly’s Insurance and Real Estate Committee, my No. 1 priority is increasing the availability of high-quality, comprehensive, and affordable healthcare plans for small employers, non-profits, and their workers.
This is why I am proud to be working with a diverse group of colleagues on bipartisan legislation, HB 6710, to authorize what is commonly known as an association health plan in Connecticut.
‘Power of Numbers’
The concept is simple—allow trade associations to provide healthcare benefits for their member organizations. Pooled together, small employers would be able to purchase insurance in much the same way that large employers do, using the power of numbers to achieve savings that wouldn’t otherwise be possible.
The proposal is backed by a wide range of small businesses and trade associations—employers ranging from retailers to accountants, physicians, charities, nonprofits, and even craft beer brewers have expressed strong support for this option.
Unfortunately, our proposal has come under ideological attack by some who oppose any new private insurance option.
Opponents have resorted to scare tactics and fear mongering, mischaracterizing association health plans as a return to the pre-Affordable Care Act days of slim benefits and little consumer protections.
But nothing could be further from the truth. The reality is our legislation is designed in such a way as to preserve all the core requirements of the ACA and to explicitly prohibit abusive practices like discriminating against individuals based on preexisting conditions.
Fact vs. Fiction
I would like to address some of the myths about this proposal directly:
Myth: Association health plans would exclude individuals with preexisting conditions.
Fact: Like other group health plans, federal law (HIPAA) prohibits association health plans from denying eligibility or continued eligibility to enroll for any individual based on health factors.
Myth: Association health plans are unregulated.
Fact: Association health plans would be subject to multiple layers of robust state and federal oversight. These plans would be regulated by the Connecticut Insurance Department, and subject to federal laws such as the Employee Retirement Income Security Act of 1975, the ACA, the Health Insurance Portability and Accountability act of 1996, the Civil Rights Act, the Women’s Health and Cancer Rights Act, the Public Health Service Act, the Mental Health Parity and Addiction Equity Act of 2008, the Genetic Information Nondiscrimination Act, and the Consolidated Omnibus Budget Reconciliation Act of 1085.
Myth: Association health plans would not be required to provide the same benefits as plans regulated under the Affordable Care Act.
Fact: Association health plans are required, under federal law, to provide all the same essential health benefits as the Affordable Care Act, including but not limited to pregnancy, childbirth, and related maternity and newborn medical conditions.
Myth: Association health plans would not be required to cover other medical conditions mandated under state law.
Fact: These plans will be subject to all of the health coverage mandates specific to Connecticut, including coverage of mammograms/ultrasounds and breast reconstruction, fertility treatments, colorectal cancer screenings, craniofacial disorders, and many more.
Myth: Individuals and families will get kicked off their plans when they get sick.
Fact: Like other health plans, association health plans must permit individuals to enroll regardless of health status, age, gender, or other factors that might predict the use of health services.
Myth: Individuals and families who get sick will be priced out of renewing policies.
Fact: No medical underwriting or pricing will occur at the individual level. All rates will be set at the business and group levels.
Myth: Association health plans would allow insurers to realize windfall profits.
Fact: Just the opposite. The entire point of an association health plan is to give small businesses greater negotiating power with insurers to negotiate lower premiums and to incentivize smarter, value-based health plan designs that lower healthcare costs.
Myth: Association health plans are dangerous and will quickly become insolvent.
Fact: Fully insured health plans will be subject to the same rigorous regulatory and reserve requirements as any other health plan. Self-funded plans will have robust capital requirements, and they will also be required to purchase stop-loss insurance.
‘Lower Costs, Better Benefits’
Connecticut’s small employers need help. Doing nothing is not an option.
I look forward to continuing to reach across the aisle to pass legislation with commonsense solutions for our problems—what Gov. Ned Lamont calls “the Connecticut difference.”
HB 6710, An Act Concerning Association Health Plans, will lower costs and provide better benefits for the employees of small business and nonprofits across Connecticut.
I encourage my colleagues to support its passage.
About the author: State Rep. Kerry Wood (D-Rocky Hill) is co-chair of the General Assembly’s Insurance and Real Estate Committee.
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