On March 8, the Senate Health, Education, Labor and Pensions Committee began its consideration of a bill (S. 1955) aimed at making health care more affordable for small businesses. The House approved a similar bill (H.R. 525) on July 25 (see The Source, 7/29/05).
In his opening remarks, Chair Michael Enzi (R-WY) stated, “Small businesses and working families are stuck on the escalator of rising health insurance costs, with no end in sight. And in a tight labor market, small business owners don’t want to jump off this fast-moving escalator, because dropping health insurance coverage puts them at a major disadvantage in competing for the best workers. So we need to give small business owners a safe place to get off this escalator of rising costs someplace where they can find more affordable health insurance options for themselves, their families, and their employees.”
Expressing his opposition to the bill, Ranking Member Ted Kennedy (D-MA) said that “for millions of Americans, the bill before us will do more harm than good. For far too many of our citizens, it will result in higher health costs and fewer benefits. The higher premiums that will result from this bill will affect primarily those who need health insurance the most older workers, the disabled, and those with chronic conditions. That is because the legislation before us will allow health plans to cherry pick businesses with young and healthy employees, while redlining those who employ older workers or individuals with health care needs. Their insurance premiums already are high enough. We shouldn’t be doing anything to make them even higher.”
During the mark-up, the committee approved, by unanimous consent, a substitute amendment offered by Sen. Enzi that would allow small business associations to pool their resources and offer fully insured health plans, known as Small Business Health Plans (SBHPs), to their member small businesses. The substitute would establish rules governing these plans, including certification, sponsorship, participation, coverage, contribution rates, benefit options, and termination. Under the substitute, SBHPs could offer coverage that does not comply with state mandates if they offer alternatives that mirror the benefits included in the state government employee health plan of one of the five most populous states: California, Texas, New York, Florida, or Illinois. The plans would be allowed to bypass most state mandates, but would be required to adhere to any coverage requirement mandated by at least 45 states. Unlike the House bill, regulation of SBHPs would be overseen by the states, rather than the Department of Labor.
The committee rejected the following amendments:
