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Monday, May 08, 2006

A Bill That Should Pass

The medical liability bills to cap pain and suffering awards were defeated with predominantly Democratic opposition. However another bill is being brought up that is even more important.

This bill is to level the medical insurance playing field between small businesses and large businesses. It would allow small businesses to combine under trade associations, etc, and offer group insurance to all their members across state lines. Instead of being subject to state insurance regulations, the bill would allow plans to be offered nationally, just as the large corporations are permitted to do. This is incredibly important.

Most job generation in this country is in small businesses, and the number of people affected is quite large. The current situation makes it nearly impossible for small businesses to employ and insure people with chronic medical conditions. If they do, their risk rating will skyrocket and so will their premiums. If businesses could form a larger insurance pool, this dynamic would change.

Contact your congressmen on this issue. It is both a major economic necessity and a matter of social justice. A 50 year old with MS should not be forced to work for a large corporation or government in order to get insurance, and five employees in a small business should not see their premiums double in two months because a sixth employee just had a minor heart attack. Increasingly small businesses have had to drop health insurance altogether.

Large businesses are increasingly dumping employees in their 50s in order to hold down their costs, so many people are facing terrible situations at that time of life. These people often have skills and experience that are desperately needed by smaller businesses - but smaller businesses cannot afford to hire them. So they consult, but they consult without medical insurance. Given our demographics, this is going to become an ever-increasing problem. Many of these individuals cannot afford to pay COBRA, and businesses are rapidly eliminating retirement medical benefits. The nuimber of people experiencing this medical insurance gap in their 50s and early 60s is going to dramatically increase.

This SFGate article discusses the phenomenon of employees rejecting employee coverage. Sometimes that is because they can get better coverage elsewhere, but often it is because they cannot afford their share. I have seen monthly premiums triple in two months when one person got sick. Some statistics from the article:
While coverage costs increased, the percentage of the annual premium that employees paid held steady nationwide and decreased slightly in California. According to the study, U.S. employees covered about 17 percent of their premium in 2003. That figure was just over 14 percent in California.

About 63 percent of insured U.S. workers were employed in companies that offered health insurance in 2003, compared with 66 percent in 1998.
Yes, but the number of employees in small businesses is steadily rising. The implication is that it is the rotten business owner who is abusing employees, but that is very rarely the case. These business owner usually need the coverage themselves, so they fight tooth and nail to keep it.
But, increasingly, some employers are offering coverage that is less than adequate, said Anthony Wright, executive director of Health Access, a coalition of California community and labor groups.

"While there are some employers who drop coverage altogether, it is more common for them to simply shift more costs onto their workers, making it unaffordable," he said. "That's just a way an employer can say they offer coverage."
Yeah, yeah, figures don't lie, but liars do figure. The implications of the two paragraphs above are broadly misrepresentative of the reality in small businesses. What would you do if you had a small business with 8 employees, and in less than six months your monthly premium per employee went from $340 to $1,115? This really happens!

Please, contact your Congress Critters on this issue. Making a truly competitive market in medical insurance could only help our economy, and it certainly will help, at a minimum, hundreds of thousands of people able and willing to work. There is no rational argument against such a law.

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