Wednesday, March 11, 2009
Chamber Urges Small Group Health Insurance Plan Reform
Maryland Chamber Vice President of Government Affairs Ron Wineholt will urge members of the Senate Finance Committee to support legislation that would make several changes to Maryland’s small group health insurance plan.
The legislation, SB 637, would:
- Allow carriers more flexibility in plan design;
- Repeal the small group benefit floor;
- Allow more geographic rating zones;
- Widen the rating bands from the community rate; and
- Allow a limited adjustment based on health status for the first three years than an employer joins the small group plan.
“This approach is preferable to other health care reform proposals because it targets the hardest to insure group, small employers, while not relying on increased state expenditures or illegal play or pay provisions,” Wineholt said. “We believe that by reforming small group and making it more attractive to employers and healthy insurance risks, we can help to contain health insurance costs for small employers.”
Similar legislation was heard in the House last month. It has long been recognized that something must be done to revitalize and reform the small group health insurance plan. Trends in Maryland’s small group market strongly suggest that design changes are warranted:
- There has been a 14 perent decline in employer participation since 1999;
- Under 40 percent of eligible small businesses participate in the program;
- There has been a 12 percent decline in covered employees; and
- A continued decline in carriers offering small group.
The December 2007 Mercer report to the Maryland Health Care Commission explored options for reforming the small group plan to make it more reflective of plans in other states and more likely to attract new participants. Many of the options from that report are incorporated in this bill.
