Unintended Consequences: Legislative Actions Drive Healthcare Cost Increases

Issues & Policies

With about two months left to the 2013 legislative session it’s a good time to recap the remaining healthcare related bills under consideration. What should be a red flag to Connecticut employers and all healthcare consumers is that legislators are looking at several proposals that will drive up—not reduce—their health insurance costs. 

More Mandates?

The Insurance Committee approved a number of health benefit mandates, despite the fact that under federal healthcare legislation they are certain to increase costs to the state and healthcare consumers alike—especially Connecticut’s small businesses. 

Health benefit mandates are services and procedures insurers are required to include in a health insurance plan.  Connecticut currently has more than 50 health benefit mandates, which the Department of Insurance says combine to add approximately 15%-20% to the cost of premiums.

Now, under national healthcare legislation, the state will have to pick up the tab for any new mandates that might be passed this session. Because that will mean higher premiums and less choice for healthcare consumers, CBIA continues to oppose new health benefit mandates. 

Weakening Competition

The Labor Committee also played a role in the problem of rising healthcare costs.

The committee approved HB 6431, which exempts cooperative arrangements (in which different healthcare providers with no business relationship combine to negotiate rates as a block) from the state’s antitrust laws that are designed to promote fair competition in the marketplace.

Competition is key to driving lower prices and better services, but HB 6431 will make consumers vulnerable by driving up costs and decreasing access.

The Connecticut attorney general also opposes this bill and in testimony to the committee pointed out similar concerns from the Federal Trade Commission (FTC). According to the FTC, this type of measure results in higher costs and decreased access to health care for Connecticut consumers.

What’s more, it’s very likely that even if this bill were adopted by the legislature, federal antitrust law would still apply.

Employer Penalty

The second problematic measure from the Labor Committee is HB 6614 which requires certain Connecticut employers with 250 or more employees to reimburse the state for certain employees and family members who choose to opt-in to the state’s HUSKY program.  HUSKY makes health insurance available to Connecticut residents depending on income level.   

HB 6614 punishes employers for hiring individuals who utilize the HUSKY program. This kind of punitive policy is not only bad for business but bad for Connecticut. 

Malpractice Bills

Medical malpractice claims are among the largest cost-drivers of healthcare costs. Two medical malpractice bills HB 6687 and SB 1154 will further increase those costs by modifying the state’s certificate of merit law. 

Currently, anyone who files a medical malpractice lawsuit must submit an opinion, called a certificate of merit, establishing threshold negligence before a court case can proceed. However, these bills that are now in the Judiciary Committee will substantially weaken the process. 

The current certificate of merit process was thoughtfully crafted in 2005 and preserves the right of action while ensuring frivolous cases do not increases the cost of providing healthcare or misuse valuable judicial resources. 

CBIA continues to work in opposition to these measures in a concerted effort to help reduce the rising cost of healthcare in Connecticut.

For more information, contact CBIA’s Jennifer Herz at 860.244.1921 or jennifer.herz@cbia.com.


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