The House spent close to seven hours debating the merits of a proposal which would allow municipal, nonprofits, and small businesses join the state employees health insurance pool.
Some lawmakers remained cautiously optimistic about the bill’s chances this year saying that when she vetoed a similar bill last Gov. M. Jodi Rell did so with a lot of praise for the proposal. But if the trip Rell’s Budget Secretary Robert Genuario made to the Capitol press room Wednesday evening was any indication, it looks like its chances may not be as rosy as proponents hope.
Genuario said Wednesday that municipalities and employers with high claims experience will be the ones that join the state employees pool and increase the risk to the state. Those with low claims history won’t benefit by purchasing a higher-cost, higher-quality plan, Genuario said. He said the state employee plans range from $8,000 to $23,000 per year.
This year’s bill is different because it decides to take the state from a fully-insured plan to a self-insured plan, which means instead of paying premiums to an insurance company the state would assume the claims risk.
Opponents of the bill said they’re concerned the state won’t be able to accurately predict the claims experience of the pool if it adds municipalities, small businesses, and nonprofits.
“It’s a crap shoot. There’s no way to predict this,” House Minority Leader Lawrence Cafero, R-Norwalk, said.
Rep. Steve Fontana, D-North Haven, a proponent of the legislation, disagreed.
He said by pooling everybody together it will spread the risk and give people access to a quality health care plan.
“Nobody doesn’t like quality, affordable health care,” Fontana said.
Fontana said that as new employers or municipalities are added to the plan the State Comptroller will be allowed to do an actuarial analysis of the risk. He said if that risk is detrimental, then the comptroller has the ability to deny these employers access to the pool.
Cafero said by inviting new people into the group we don’t know their medical claims history. “If we guess the wrong number it could go up even higher,” he said.
Of the more than 20 states which allow municipalities to join the state employees health insurance pool, none of them allow small businesses and nonprofits to join, both Cafero and Genuario said Wednesday.
Fontana said the program is completely voluntary and employers could chose to join if they wish and the state has the ability to reject them if it believes the risk is too great.
He reminded his colleagues that the state did self-insure prior to 1997. Going to a self-insured plan would save the state $70 million in the short term and offer health insurance to small businesses and nonprofits, which may have been unable to afford it in the past, Fontana said.
Genuario said he’s not ideologically opposed to self-insurance, but he wouldn’t support it at a time when the state has a favorable full-insurance contract.
He said the current contracts were favorable because the actual claims history was 5.9 percent higher that the projected claims. He said under the fully-insured contract the insurance companies were on the hook for the 5.9 percent or $69 million in unanticipated claims, not the state.
“We’re not supportive of the bill as written,” Genuario said. “It exposes the state to paying for what in all likelihood would be a high-risk group of folks.”
Speaker of the House Chris Donovan said the bill could immediately save cities and towns money. “Health care is a big issue. People really want something to be done about it,” he said.
A vote on the amendment, which was a strike all amendment and essentially became the bill passed 110 to 36, mostly along party lines. The bill passed 109 to 36.
Shortly after the bill passed the House began debating the SustiNet proposal.