Most people agree: Stop raiding the state’s Special Transportation Fund so we can make real progress on improving Connecticut’s infrastructure.

Shouldn’t we stop raiding other state cookie jars, too?

Connecticut has several special funds to pay for specific purposes. And while many agree on the need to stop raiding the transportation fund, it’s also happening to the state’s Insurance Fund. 

And small businesses are paying for it.

Core mission

The Insurance Fund pays for the operations of the state Insurance Department and is paid for by insurance companies through assessments. 

Protecting insurance consumers and enforcing laws to ensure policyholders are treated fairly is the core mission of the Insurance Department. 

Change of plans

Yet over the years the Insurance Fund has quietly been tapped to pay for other things, such as childhood vaccinations and state policy initiatives such as the State Innovation Model.

Now, some in the legislature want the fund to pay for $8.8 million worth of public health programs. 

These are all good causes, but none of them Insurance Department-related. Which means the Insurance Fund, which will total more than $81 million in 2017, is being raided.   

It also means higher health insurance premiums for smaller employers in Connecticut. 

Small businesses pay

Here’s how it works: Health insurance companies will receive a bill for the $8.8 million from the Insurance Department, and in turn will pass that cost along to their customers in the form of higher premiums.

In this case their customers means smaller employers that fully insure (that is, who buy from insurers). Larger employers self-insure and are exempt from state laws such as this one.

The bottom line is that Connecticut can do better. We must learn from our mistakes (think Transportation Fund) and make better decisions. Let’s use the Insurance Fund for insurance not to plug public policy funding holes. 

For more information, contact CBIA’s Jennifer Herz at 860.244.1921 | | @CBIAjherz