Connecticut lawmakers challenge Association Health Plans with alternative proposals

Association Health Plans, which are not currently allowed in Connecticut, would allow small businesses to form a group and purchase health insurance in bulk. However, that health insurance doesn't come with the protections of the Patient and Affordable Care Act.

"The last thing CT needs are false solutions. That's what Trump era associated health plans will offer," Rep. Sarah Keitt, D-Fairfield, said during a capitol press conference.

Last year, lawmakers found bipartisan support for Association Health Plans, but it never made it over the finish line.

Democrats want to revisit a proposal last year that would allow the Insurance Department, which only regulates state plans, to be able to grill insurance companies further over their cost increases. In 2024, the average rate increase for state regulated plans was 9.4%. Another proposal would create a program to analyze the role of pharmacy benefit managers in the state.

"There are deals made between the pharmacy industry and the insurance industry and it never trickles back down to consumers," Rep. Susan Johnson, D-Windham, said.

Reps. Christine Conley, D-New London, and Liz Linehan, D-Meriden, pitched tax incentives. Under their plan, businesses would receive tax breaks and incentives for covering employees at the silver level and above through Access Health CT. They also pitched expanded credits to businesses that contribute towards employee's health savings accounts or deductibles.

"We know from a lot of small businesses that they want to make sure their employees have comprehensive health care, have all of their conditions covered, and are able to deal with whatever health issue they have, small or large.in their family," Conley said.

Linehan said it is a finance bill because it would reward business for doing the right thing.

"This is about entrepreneurship," Linehan said.

Connecticut's largest business lobby will push again this year for Association Health Plans because they see it as a way to provide those businesses and employees with the best benefits, at the lowest cost.

"These associations offer the best opportunity for the most small businesses to provide quality, low-cost healthcare for their employees," CBIA's Vice President of Public Policy Chris Davis said.

Health insurance is often cited as one of the biggest cost drivers for businesses.

"It gives an opportunity for small businesses to pool their risk and set a better price by negotiating as a single employer. Employees would enjoy guaranteed issuance and guaranteed renewals," Davis said.

Pareesa Charmchi Goodwin, executive director of the Commission on Racial Equity and Public Health, addressed the inequities perpetuated by level-funded health plans and other stop-loss insurance policies.

"Because of the racial health inequities in our state, Black and Latino/a residents in our state have higher rates of chronic diseases and are therefore more likely than white residents to be charged higher premiums based on health risk calculations."

While the state cannot directly regulate self insurance plans, the state can regulate the stop-loss policies that these plans rely upon. Goodwin suggested that Connecticut should limit the size of employers which can purchase stop-loss coverage for these plans, and increase attachment points in stop-loss policies. The attachment point is the threshold at which the employer pays medical claims, and Connecticut's has not been updated since 1999.

"These controls are tools that other states have used to crack down on the overuse of level funded plans, bring down costs for the small group market and protect against the unfair practice of charging people with disabilities and people of color more for their healthcare," she said.

Lastly, the Democrats proposed what they are calling Covered CT 2.0, an expansion of Covered CT, a program which provides low cost health and dental insurance and non-emergency medical transportation to all CT residents 19-64 that qualify.

Currently, qualification is limited to residents who don't exceed 175% of the federal poverty line. For a family of four, that limits maximum income to $52,500. The proposal would expand full coverage to residents up to 200% of the poverty line, and between 200-300%, residents could receive coverage for a small fee.