SB 110 under the knife

Gov. John Lynch and a bipartisan group of 13 state senators have announced a compromise that they say will reform the controversial Senate Bill 110 insurance law.

The governor at a press conference said the compromise will reverse the spike in health insurance premiums for many of the state’s small businesses – premium increases that resulted from SB 110’s provisions against community rating.

Under the compromise, insurers would no longer be able to consider a business’ location or the health of its workers in setting premiums. Insurance companies still would be able to consider workers’ ages and their industries.

The bill also would set up a pool for higher-risk policies. All policyholders would pay a small sum – estimated at about 2 cents per day per insured — to cover the high-risk pool.

While the compromise measure contains several significant changes, it stops short of fulfilling Lynch’s campaign promise to repeal the law, but the governor and other supporters praised the deal.

“Although passed with good intentions, the impact of SB 110 on our small businesses has been devastating,” Lynch said. “These increases have made it difficult for our small businesses to grow, to hire new employees, to invest in new equipment.”

Sen. Ted Gatsas, R-Manchester, one of the chief sponsors of the bill, said the measure “provides stability to the market. It provides efficiency and fairness.”

Sen. Robert Flanders, R-Antrim, told the Associated Press he remains concerned that eliminating the health of employees from consideration will undermine the goal of increasing competition.

“The insurance companies are going to wash their hands of New Hampshire,” he said.

Bob Nash of the Independent Insurance Agents and Brokers of New Hampshire said his group supported Flanders’ bill, which would make minor adjustments to current law and create a reinsurance pool for employee groups of between two and 15.