Lawmakers Fail Again on Small Business Employee Healthcare
For the second consecutive year, the legislature failed to act on bipartisan legislation addressing the growing crisis in the fully-insured small group market.
HB 5247 was spearheaded by Insurance and Real Estate Committee co-chair Rep. Kerry Wood (D-Rocky Hill) and again supported by Democrats and Republicans in both legislative chambers.
The bill allowed qualifying chambers of commerce and trade associations to aggregate their respective memberships and offer robustly regulated self-funded health benefit arrangements—essentially acting as one large employer.
HB 5247 was one of more than 40 bills that failed to advance out of the Insurance Committee in March. For the first time in recent memory, the committee failed to act on any of raised bills.
Lawmakers from both sides of the aisle viewed HB 5247 as a commonsense approach that would finally give small employers the scale and leverage to obtain high quality, cost-effective healthcare for employees.
‘Biggest Disappointment’
CBIA president and CEO Chris DiPentima called the legislature’s failure to address small business employee healthcare costs “one of the biggest disappointments of the session.”
“For the second consecutive session, lawmakers were presented with bipartisan, transformational legislation that would change the lives of hundreds of thousands of small business employees,” he said.
“It’s not news that the small group health insurance market is broken—reinforced by the departure of yet another carrier this week—with small businesses and their employees battling rising costs and shrinking options.
“There was a meaningful solution on the table and it is incredibly frustrating that the bill failed to even receive a committee vote.”
CBIA’s Chris DiPentima
“There was a meaningful solution on the table and it is incredibly frustrating that the bill failed to even receive a committee vote.”
Cigna Healthcare and New York-based insurance technology company Oscar announced earlier this week they were withdrawing from the small group fully-insured market—the third health insurance carrier to exit the market in the last two years.
The fully-insured market has consistently declined in membership every year, with total enrollment less than 80,000 lives today—down from over 230,000 lives only five years ago.
Consumer Protections
HB 5247 featured strong consumer protection measures that went above and beyond what today’s self-funded market is subject to, including:
- Direct regulatory oversight by the Connecticut Insurance Department and federal Department of Labor
- Strict requirements to offer robust plan benefits and design on par with the ACA market
- Cover all ACA consumer protections codified under ERISA
- Maintain stop-loss
- Apply consistent pooling points
- Offer plans on a guaranteed issue and guaranteed renewable basis
Virginia Model
Today, municipalities, Taft-Hartley trusts, and the state of Connecticut are authorized to pool employers and municipalities with virtually no oversight.
More than 50 business, nonprofit organizations, trade associations, and chambers of commerce testified in support of the bill at the public hearing earlier this year.
Today, municipalities, Taft-Hartley trusts, and the state are authorized to pool employers and municipalities with virtually no oversight.
The bill was raised following the success in Virginia in 2022 when the Democratic legislature and Republican governor collaborated to offer trade associations the ability to aggregate their members under a self-funded MEWA.
Earlier this year, the Virginia Chamber of Commerce’s new WiseChoice Healthcare Alliance obtained a license from the state and will now offer coverage to enterprises with two to 50 employees, members of a participating local chamber of commerce, the Virginia Farm Bureau, and other trade associations.
Lawmakers in Connecticut hoped to emulate the success in Virginia by passing similar legislation this year.
For more information, contact CBIA’s Wyatt Bosworth (860.244.1155) | @WyattBosworthCT.
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