Be Wary of New Health Benefit Mandates
With healthcare costs rising and significant changes facing the health insurance market, legislators should be wary of any new proposals that would further increase costs, especially on Connecticut’s small businesses.
New Mandates to Cost
Connecticut’s state health insurance exchange has already adopted an Essential Health Benefit (EHB) package that defines the group of benefits that insurance companies must offer in their products in the state in 2014.
However, while the EHB package includes all of the state’s existing health benefit mandates, new mandates proposed during this legislative session would not be included in the EHB package–and therefore would become a direct cost to the state.
Under the federal healthcare legislation, federal dollars will be applied to cover Connecticut’s existing EHB package for people receiving subsidized coverage through the state exchange.
If state lawmakers adopt any new benefit mandates this year, Connecticut will have to subsidize their costs.
Small Business Impact
More important, the cost impact of any new benefit mandates will fall mainly on Connecticut’s small businesses.
Health benefit mandates are state laws that require fully-insured health plans to cover various healthcare services.
Since most small businesses purchase these fully-insured plans (larger businesses tend to self-insure), additional mandates will leave them vulnerable to the extra costs.
And because the federally subsidized EHB package cannot be opened up and modified until 2016, at the earliest, small businesses would feel the cost impact for several years.
The legislature should use the tools it has availableto analyze and collect data on new mandates as early as possible in the process.
With the state facing significant budget restrictions, detailed analysis, including fiscal impact, should be a first step in the legislative process.
For more information, contact CBIA’s Jennifer Herz at 860.244.1921 or firstname.lastname@example.org.
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