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Enzi committee passes health insurance bill for small business employees

Estimates predict legislation would enable a million more workers to find insurance coverage than are covered now

March 15, 2006

Washington, D.C. – The Senate Health, Education, Labor and Pensions (HELP) Committee voted in favor of a landmark bill today to allow business and trade associations to band their members together and offer affordable group health insurance to working families, U.S. Senator Mike Enzi, R-Wyo., Chairman of the HELP Committee said.

The vote ended a stalemate that has lasted for more than a decade.

“Today’s vote is the first major step in 15 years toward more affordable health insurance options for small business and working families,” Enzi said. “The people who make up the bedrock of our economy – small, family owned businesses, have demanded change. It’s time for the Senate to pass this bill. No more excuses.”

The bipartisan bill, “The Health Insurance Marketplace Modernization and Affordability Act,” S.1955, which was introduced by Enzi and cosponsored by Senator Ben Nelson, D-Neb., and Senator Conrad Burns, R-Mont., will allow business and trade associations to band their members together and offer group health coverage on a national or regional basis in direct response to runaway costs that are driving far too many employers and families from comprehensive health insurance.

“If Small Business Health Plans can harness the power of America’s small business owners, it would force the entire marketplace to respond. If we transform health insurance to a market where small employers and family-owned businesses can demand better benefits at better prices, insurance companies would be forced either to keep up with the competition, or lose their market share,” Enzi said. “With the help of a diverse group of senators and business groups representing small business, we’ve bridged the gap between small business proponents of traditional AHPs and state-based interests worried about the prospects of dramatic regulatory changes in health insurance markets.”

A few special interest groups have launched public relations campaigns designed to sink the small business health legislation despite the potential the bill holds to reduce costs and increase coverage. Enzi believes this bill has a better chance of survival because he’s worked with diverse interests to include important safeguards to prevent adverse selection that would split healthy and sick groups and send premiums skyrocketing for the sick groups. The bill preserves the state role in protecting insurance consumers and ensures that small business owners will have the choice of both basic and enhanced packages of benefits.

“If you can’t afford insurance you aren’t getting coverage for any procedures, mandated or not,” Enzi said. “My bill would allow a small business benefit health association to offer a more affordable healthcare package that may not include some of the state’s benefit mandates, but it would be required to offer a comprehensive alternative package.”

Enzi said it is also important for people to understand that just because a service isn’t mandated doesn’t mean that service is unavailable.

“My bill doesn’t take away anyone’s right to a comprehensive benefit package. It does ensure that at least one comprehensive policy must be offered to every small or family-owned business, while ensuring that basic, affordable policies are available as well,” Enzi said. “One family shoe store can’t get an insurance company to play ball. But 10,000 family shoe stores probably can. We ought to help American small businesses and their employees negotiate for what they want from the insurance companies.”

Enzi pointed out that nearly every big employer offers cancer screenings, for example, to their employees, yet the big companies that “self-insure” aren’t subject to state mandates.

“What we are doing with this legislation is giving small businesses the same power that big businesses have. Small businesses will choose to offer services like cancer screenings – just like big businesses do. They will have more power than ever before to help take care of their workers’ health needs.”

Enzi praised the support of Senator Nelson and Senator Burns, the bill’s cosponsors, saying: “I’m pleased to be joined by my colleagues, Senator Nelson and Senator Burns. They bring invaluable experience to this effort and I am grateful for their commitment to this issue.”

Senator Nelson said: “If we don’t do something to help small businesses cope with the costs of health care, soon we will have an entire workforce without health insurance coverage. Health care premiums are experiencing double-digit growth annually; small businesses can’t keep up with the costs. As a result, fewer employers are offering health coverage and fewer employees are covered. The continuing problem of skyrocketing heath care costs is a grave threat to our working families. This action by the HELP Committee today is the first step in addressing this problem.”

Senator Burns said: “The Health Insurance Marketplace Modernization and Affordability Act represents the best opportunity to bring affordable health insurance to small businesses in Montana and across the nation. I know this is a goal for all Senators, and I look forward to working with members from both sides of the aisle in achieving this important goal.

Designed to enhance the market leverage of small groups as well as individual policy holders, “The Health Insurance Marketplace Modernization and Affordability Act” will give associations a meaningful role on a level playing field with other group health plans; streamline the current hodgepodge of varying state regulation; preserve the primary role of the states in health insurance oversight and consumer protection; make lower-cost health plan options available; and achieve meaningful reform without a big price tag.

A report prepared by the Milwaukee firm of Mercer Oliver Wyman, Inc. for the National Small Business Association found that the Enzi-Nelson bill would reduce health insurance costs for small business by 12 percent. In today’s dollars - about $1,000 per employee; and, would reduce the number of uninsured in working families by 8 percent - or approximately 1 million people.