Small Business and Health Insurance
11:38 am
Wed March 21, 2012

Healthcare Bill Attempts To Improve Access For Small Businesses

A new bill before the legislature aims to provide more options for small businesses purchasing health insurance. But as WNPR’s Harriet Jones reports, it looks likely to stir up significant controversy.

Carolyn Malon runs a dental practice with her husband in Farmington.

“Every day in my own practice, I see the challenges that patients, self-employed people and small employers have in assessing good quality insurance coverage.”

As a small business owner she’s backing new legislation to increase access to health coverage for a very personal reason.

“My husband and I have tried to keep down the cost of our health insurance premiums by taking a gamble on a policy with higher deductibles. That decision backfired last year when our son was hospitalized for a bood-borne staph infection. Primarily because of our high deductible, our out-of-pocket cost for his treatment amounted to over $9,000. And it’s really beyond the ability of many of our citizens to pay bills such as this.”

When Sustinet was enacted last year, many small businesses were disappointed that the final legislation backed away from a promise to allow small employers to buy into the state insurance pool.  Now this bill attempts to take that effort forward. State representative Robert Megna co-chaired a working group that came up with the proposed legislation.

"We have a lot of people employed in the insurance industry. And when I think about what we’re trying to do here, we’re actually wanting to make this state the true insurance capital of the world by putting everybody on the healthcare rolls."

The bill would also mandate that insurance companies have to allow small companies to band together to take advantage of large group rates.  And it would stop them from taking account of age and gender when setting rates. Kevin Galvin who employs three people in his own company is chairman of Small Business for Healthy Connecticut.

“The insurers have to realize that they’re dealing with the largest employer group in the state and the country, and they have to stop marginalizing that group.”

He says buying into the state pool would increase financial security for small employers and allow them to hire.

“It’s a bill that really has no downside. It’s simply allowing the largest employer group in the state into the largest insurance pool in the state, with critical oversight by the Comptroller.”

But the bill faces significant opposition – largely on the same grounds that Sustinet faced. Eric George from the Connecticut Business and Industry Association.

“The heart of the bill is in the right place. It wants to get people insurance. I completely understand and agree with that. It’s how it gets to that end that we have concerns.”

George says opening the state pool may involve unintended consequences.

“Under the pool, it’s a self-insured system – you don’t know which groups are going to come in. If those groups are high risk, that could be significant cost to the state and all of its taxpayers.”

George says he also believes that changes to rate mandates for private insurance may actually drive rates up. The CBIA says it wants to see small businesses wait for better access until health plan exchanges are set up under the federal healthcare law.

For WNPR, I’m Harriet Jones.