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Business groups oppose insurance option

April 22, 1998
By: Brent P. Johnson
State Capital Bureau

JEFFERSON CITY - Business groups continued to testify against a bill that would establish an optional health insurance purchasing pool for small businesses, which partially comprise the businesses they represent.

Before the Senate Committee on Insurance and Housing, spokesmen for the Missouri Chamber of Commerce and Associated Industries of Missouri argued instead for "dollar-for-dollar" tax credits for small business employers who provide coverage for their employees.

"You want the state to pick up the costs?" Sen. Phil Curls, D-Kansas City, asked Dan Mehan of the Chamber of Commerce.

"What the state's trying to do to reduce revenue, this is a great place to start," Mehan said.

With three weeks left in the session, the Senate committee has not voted on the bill, which passed the House March 4. The bill attempts to address the issue of making health insurance more affordable for businesses with fewer than 50 employees by allowing them to join a pool to purchase it under the state's health care plan. The Missouri Consolidated Health Care Plan currently has pools of state employees and local government employees. Insurance companies bidding to provide insurance to one pool would be required to bid on all three.

"Insurance companies have always opposed insurance reform," bill sponsor Rep. Tim Harlan, D-Columbia, said. "Our solution is to provide more competition (to provide insurance) for small businesses. Their solution is to force taxpayers to pay."

Opponents have argued that the concept of "adverse selection" will damage the state's plan and not lower insurance costs for the businesses the bill intends to help. Only businesses with high health risks, they say, will join the pool, which would drive costs up.

A Blue Cross Blue Shield spokesman placed the blame for already high rates on high doctor's bills. "It's been staked as an aceess problem. I would suggest that businesses and individuals have plenty of access. The problem's in price. And the reason for that is primarily the cost of medical care."

"It comes down to the chicken and the egg," Harlan said. "If we don't put out an option for business, we don't know if it works. If it doesn't work, it won't hurt."

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