AZ small businesses deserve better on health insurance costs

PHOENIX – Last week, the Arizona Chamber of Commerce & Industry office was a hub of policy exchange as we hosted a delegation of lawmakers and business leaders from Missouri.

The "Show Me State" representatives came west to see how our deliberate policy choices in areas like regulation, taxes, and emerging technologies have turned Arizona into a global leader in advanced manufacturing and semiconductors.

Arizona has much to teach other states about economic growth, and we are proud to showcase the work of our lawmakers and successive governors.

But during those conversations, one lesson ran in the other direction: Missouri is showing us a better way to help small businesses afford health care.

In Missouri, the state chamber of commerce offers small businesses a Multiple Employer Welfare Arrangement, or MEWA. It's model that allows small businesses to pool their risk and gain a level of buying power typically reserved for larger corporations. The result is greater rate stability, more plan choices, and lower costs.

It's not just Missouri that offers MEWAs. Nearly 30 other states have already implemented similar programs. Yet in Arizona, many small businesses and sole proprietors remain on the sidelines. House Bill 2693, sponsored by Rep. David Livingston, is our opportunity to catch up.

HB 2693 expands the definition of entities that can operate these self-funded health plans to include statewide chambers of commerce and business leagues. By allowing small employers to join a larger pool, the bill helps stabilize premiums and expand access to quality coverage for the job creators who are the backbone of our economy.

Despite no group coming forward to oppose the bill publicly, some legislators have expressed criticisms, but they miss the mark.

First, HB 2693 is fully compliant with the Affordable Care Act (ACA). Opponents often confuse this state-level expansion with a 2018 federal rule that was struck down in court. This bill is different. It operates within the explicit authority granted to states under ERISA, the Employee Retirement Income Security Act of 1974, to regulate MEWAs.

This bill also doesn't weaken coverage protections. Arizona law continues to require coverage for preexisting conditions, maternity care, mental health coverage, and prescription drugs. In practice, large group plans—which MEWAs emulate—often provide more comprehensive benefits than what many smaller employers can access today, including superior dental and vision coverage.

This bill creates affordability through scale. By pooling together, small employers create a larger risk pool that puts natural downward pressure on costs and reduces volatility. By purchasing as a coalition, small businesses gain the leverage to negotiate for the high-quality, robust coverage usually only available to the state's largest employers. This isn't about cutting corners; it's about using collective strength to make comprehensive care more attainable.

The bill also recognizes the modern workforce by including sole proprietors and working owners. If an individual works at least 20 hours a week or earns enough to cover their premiums, they deserve access to the same stable, high-quality coverage as a corporate executive.

For years, Arizona has led by embracing innovation and market-based solutions. It's time we apply that same mindset to health care. By passing HB 2693, we are giving Arizona's small businesses another tool to grow, compete, and thrive.

Danny Seiden is the president and CEO of the Arizona Chamber of Commerce & Industry.