Cost Is No. 1 Reason to Skip More Insurance Mandates

A new report from the Connecticut Health I-Team says that private-sector employers in Connecticut have seen the price of health insurance premiums, and what their employees contributed toward them, double since 1999.

Meanwhile, says the report, household income in the state increased by only a third.

Those numbers are disturbing but no surprise to healthcare consumers in Connecticut.

Every time state lawmakers approve legislation requiring state-regulated insurance policies to cover certain medical procedures and services, the cost of insurance rises for everyone.

Connecticut has the fifth-highest total of healthcare mandates in the U.S., according to the Council for Affordable Health Insurance (CAHI), which estimates that just one type of mandate alone adds an estimated 20% to 50% to the cost of health insurance in Connecticut.

With several more mandates on the legislative platter this year, our already high number of mandates (59, by CAHI’s most recent count) could increase further.

Mandates specifically hurt small businesses, because they usually have to buy state-regulated health insurance policies that come with the mandate strings attached—unlike larger businesses that are more apt to be able to self-insure.

More mandates mean higher costs for small businesses and a diminished ability to add jobs.

Yet what continually happens is that state lawmakers criticize the rising costs of healthcare and then pass new mandates that keep increasing those costs.

Instead of addressing the real issue of healthcare costs, state lawmakers keep focusing on schemes to distribute healthcare costs differently (such as by pooling different purchasing groups). The problem is, studies show that savings through pooling schemes, if they occur, are minor and fleeting.

If lawmakers really want to put the brakes on skyrocketing healthcare costs, they can start by focusing on the real cost-drivers that are making health insurance unaffordable for more people. A good way to start is to put a halt to new mandates still before them in the last days of the 2011 session.

Making healthcare less affordable is poor public policy and unfair to small businesses and the people they employ.