Lawmakers put spotlight on health care

Health-care costs – specifically, lowering them for small businesses – are at the top of some lawmakers’ agendas as the 2006 session begins.

A group of New Hampshire lawmakers wants to study whether businesses should receive refunds if their health insurance rates skyrocketed under Senate Bill 110. Lawmakers also are looking to allow businesses to buy health insurance either through a chamber of commerce, an existing trade organization or a newly formed organization.

Sponsored by Rep. Lee Quandt, R-Exeter, House Bill 1190 calls for establishment of a study committee to look into the feasibility of mandating refunds for businesses adversely affected by SB 110.

“We were told when it [SB 110] went through that there would be caps at 20 or 25 percent,” said Quandt, who said he opposed the 2003 law that was repealed in the last legislative session. “Some people had their premiums jump 200 percent. If we did have caps, either the Insurance Department didn’t enforce them or the caps were bogus. I think we need to look at that and determine how to recoup the money.”

SB 110 – which affected the state’s smallest businesses — eliminated community rating and added risk factors that could be considered in determining a firm’s premiums. Proponents said the law would encourage competition among insurers and lower rates, but its immediate effect involved double- and triple-digit increases in premiums for hundreds of employers around the state.

SB 125 was signed into law by Gov. John Lynch last July to mitigate the more onerous effects of SB 110 by eliminating certain rating factors, establishing a reinsurance high-risk pool and capping premium increases at 20 percent.

Quandt said the committee would examine just who would be eligible for a refund. He also said the committee, if it found that such a refund were warranted, would consider several types of reimbursements, including repayments of excessive charges or discounts on current premiums.

“The form of refunds will be entirely negotiable,” Quandt said. “This is a complicated issue.”

A public hearing on HB 1190 is scheduled for 11 a.m. Feb. 2 in Room 302 of the Legislative Office Building in Concord.

Elsewhere in the Legislature, New Hampshire businesses will be able to join together to purchase health insurance if a bill that passed the House Jan. 4 becomes law.

House Bill 515 would allow businesses to buy health insurance either through a chamber of commerce, an existing trade organization or a newly formed organization. As soon as the purchasing alliance reaches a threshold of 3,000 covered lives, the alliance would be able to get an experience rating, and be eligible for lower insurance rates.

No organization would be able to exclude an employer because of a bad claims history.

“This a giant step forward in reducing the cost of insurance for small businesses,” said Rep. Sheila Francoeur, R-Hampton, chair of the House Commerce Committee.

Opponents of the measure said that the groups would not be large enough to have any substantial effect on premiums. They also said the bill would allow many businesses to bypass small insurance brokers, driving them out of business. They also argued that the bill was introduced at the last minute, and needed more public input before becoming law.

“You want to wipe out 500 small businesses [insurance brokers]without giving them a chance to come in to talk to you,” said Rep. Lee Quandt, R-Exeter.

Quandt and other opponents, also noted that SB 125 had barely gone into effect, and the new proposal would only be adding yet another major change.

“We don’t know what the problems in 125 are yet,” said Quandt. “Slow the train down. Let’s give the industry a breather.”

But supporters said that the amended bill was scrutinized during numerous subcommittee meetings, that most of the additions had already been adopted in Insurance Department rules years ago, and that SB 125 only deals with groups of businesses with fewer than 50 employees.

Proponents also argued that HB 515 would allow small businesses dissatisfied with their rates under the new law to join a larger group in order to increase their bargaining position, as well as well put programs in place to keep employees healthier, enabling them to reduce claims and lower premiums.

— CINDY KIBBE AND BOB SANDERS