CT Official Wants Expanded Health Buying Pool

February 4, 2005 (PLANSPONSOR.com) - Connecticut small businesses could reap savings of 15% or more from a health coverage purchasing pool.

>Comptroller Nancy Wyman said the purchasing pool and other steps she is suggesting will be in proposed legislation she will be advancing, the Hartford Courant reported.

>Wyman said that while s he said she wants to help all of Connecticut’s 90,000 small businesses, the largest savings would most likely go to the smallest firms. Those would typically be companies with up to 10 or 15 workers, an official in Wyman’s office later explained.

That’s because state law dealing with small business insurance for companies of up to 50 workers allows insurers to charge the smallest ones higher rates. Half of uninsured workers are employed by firms with 10 or fewer employees, Wyman noted.

“To me, it’s disgraceful that here in the insurance capital of the world, tens of thousands of hard-working people go to work every day and come home praying that their families are not sick or they’re not sick because they have no health insurance,” Wyman told a press conference, according to the Courant.

Wyman’s bills deal with expanding an existing health insurance pool – the Municipal Employees Health Insurance Program (MEHIP) and changing Connecticut law on how insurers figure premiums for employers of 50 or fewer workers, according to the Courant. The MEHIP is now open to non-profit organizations with government contracts and employers of up to 50 workers.

The non-profits can get discounts of 2% to 4% compared to what they would pay outside the program, based on an exemption from Connecticut’s premium tax and a small savings MEHIP was able to negotiate, the paper said.

Wyman wants the General Assembly to exempt uninsured small employers who join MEHIP, or buy through an association’s health plan, from the state’s 1.75% premium levy.

A key part of Wyman’s plan addresses the “loads” that insurers tack onto their rates for tiny employers, typically for groups of up to 10 or 15 workers. Wyman seeks legislation so MEHIP and associations could negotiate with insurers to drop the extra charges, Woodruff explained.

In addition, Wyman wants to open up the MEHIP to all IRS-qualified non-profit organizations that receive federal, state, or municipal funding, whether or not they have contracts with local or state government agencies.