Mandates No ‘Prescription’ for Lower Healthcare Costs
When it comes to cutting the high costs of healthcare in Connecticut, policymakers need to adapt the old proverb “Physician, heal thyself.” That’s because as lawmakers rail against high healthcare costs on the one hand, they are working to raise them with the other.
One of the most significant healthcare cost drivers in Connecticut is the state’s high number of health benefit mandates—laws that require state-regulated insurance policies to cover certain medical procedures and services.
According to the Council for Affordable Health Insurance (CAHI), Connecticut has 54 mandates, the ninth highest number in the country. (By some estimates, more than 60, depending on the provision.)
But again this year, lawmakers in the Insurance Committee are lining up over a dozen proposals for yet more health insurance mandates.
This is discouraging because for years the business community has implored the committee not to adopt these costly measures, which threaten to make health insurance unaffordable. Mandates such as these only make health insurance more expensive and increase the likelihood that companies will have to drop coverage.
CAHI estimates that just one type of mandate—those requiring certain benefits— alone adds an estimated 20% to 50% to the cost of health insurance in Connecticut.
Mandates also have a bigger impact on small companies than on larger firms. Typically, smaller businesses buy state-regulated health insurance policies (as opposed to larger companies that can afford to self-insure)—and those regulated policies come with the mandate strings attached.
As a result, health insurance is more expensive for those that can least afford it: small businesses and their employees.
A report by the National Center for Policy Analysis confirms the problem—estimating that 25% of the uninsured in the U.S. are priced out of the market by state mandates.
If lawmakers are truly serious about reducing the cost of healthcare in Connecticut, they should impose a moratorium on mandates.
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