CBIA BizCast: Virginia’s Solution for Small Business Healthcare Costs
Later this year, the healthcare landscape for Virginia small businesses and their employees will change dramatically when they gain access to broad new options for affordable, quality health insurance.
“This is a game changer,” said Democratic state Senator Monty Mason, a key figure behind bipartisan legislation permitting what are known as association health plans.
“I think this has the capacity to be one of the most consequential pieces of legislation as far as impact on people.”
Virginia is among a number of states—including Ohio, Missouri, Maine, Georgia, and Washington—that changed their laws to address what is one of the biggest challenges facing small businesses.
“This is transformational for small business,” says Virginia Chamber of Commerce president and CEO Barry DuVal.
“They’ll be able to offer health coverage at competitive prices, the same kind of coverage that large firms offer. That’s important for hiring and retaining people.”
While Mason championed the Virginia legislation, he says he wasn’t always on board.
In fact, he spoke at a statewide chamber of commerce meeting to say he didn’t think the plans made sense.
“They didn’t appreciate that very much as you might imagine, and came to see me and said, ‘Hey, you know, I don’t think you understand the overall picture, would you be willing to talk to us about it?’” he recalled.
“By the time they took me through it, and I understood it better, and got the concepts that I obviously didn’t understand before, I thought it made a lot of sense.
“Expanding healthcare coverage for all people should be as bipartisan a discussion as we can find.”
Mason worked closely with Virginia Chamber of Commerce president and CEO Barry DuVal on the bill.
Both pointed to the challenges facing small businesses when it comes to healthcare costs.
“We found that rising healthcare costs was the number one concern for those small businesses,” said DuVal.
“We wanted to make sure that we could find a solution that allows small businesses to offer competitive insurance policies that were also high in quality.”
Getting the bill passed in Virginia required a bipartisan effort, particularly considering the close margins in the House and Senate.
“What I found on both sides of the aisle is that they want to provide an environment where small businesses can grow and prosper,” said DuVal.
“If you find a way of demonstrating the need, find a way of showing the problem that small businesses have, we found that Republicans and Democrats were willing to come together for a solution.”
Level Playing Field
Mason said that one of the challenges was making sure that lawmakers understood the components of the bill.
“Making sure you go to them upfront and just say, ‘Hey, here’s what we’re thinking, here are the guardrails we’re putting in place, here are the heightened level of responsibilities that we want to ask for, you know, is that in line with your thinking?’” he said.
“Just by being super open and transparent about that throughout the whole way, and from the very beginning, I think it really helped our cause.”
DuVal added that not only does the bill give small businesses access to similar plans as large companies, it also provides access to additional services like wellness programs.
“I think it’s important to level the playing field for small businesses,” said DuVal. “We think it’s going to be transformational for small businesses in Virginia.
“We do see it as both financially improving the competitiveness of small businesses and also from a healthy lifestyle improving the employees lives.”
Healthcare costs jumped by 6% last year in Connecticut—more than $2 billion—and state lawmakers are now considering legislation similar to the Virginia law.
HB 6710 allows nonprofits, trade associations, and their employer members two pathways to obtain affordable, high quality health insurance—either as a group that negotiates and purchases directly from an insurer or as a self-funded entity.
The bill is backed by over three dozen nonprofit groups, trade associations, and business organizations and has broad support from both Democrats and Republicans in the General Assembly.
It’s a viable, market-based solution to an issue that has challenged Main Street firms for too long.
While businesses with 50 or fewer employees are not required to offer employees health coverage, none can expect to seriously compete for talent without offering that benefit.
The lack of affordable options is a major concern for small businesses, with too many of them forced to choose between high-cost plans with limited benefits or not providing any coverage for employees.
‘Now Is the Time’
A critical component of the legislation ensures compliance with key provisions of the Affordable Care Act, as well as extensive oversight by the Connecticut Insurance Department.
The bill includes express language stating that coverage cannot be denied to people with preexisting conditions along with the following protections:
- Preventive health services are covered without cost-sharing
- Maximum out-of-pocket expenses for covered benefits are capped
- Nondiscrimination rules for eligibility
- Parity in annual and dollar limits
- Mental health benefits with medical and surgical benefits
- Dependent coverage for adult children up to age 26
HB 6710 is pending before the House of Representatives.
“Now’s the time to get it over the finish line and get it through both chambers to the governor’s desk,” said CBIA’s Wyatt Bosworth.
“Call your legislators, go to the CBIA website, check out our information on it.
“Take action, send emails, make a phone call, send a text, do whatever you can to make your voice heard before June 7,” he said.
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