On the last day of the legislative session, officials from Connecticut’s health insurance exchange made a last-minute effort to kill House Bill 6710, a bill that would have allowed business and nonprofit associations to offer their own health plans, according to an Access Health CT (AHCT) email sent to lawmakers.
The bill, heavily pushed by the Connecticut Business and Industry Association (CBIA) who argued it would make health insurance more affordable for small businesses, appeared to have wide support, having been passed on a bipartisan basis by the Insurance and Real Estate Committee and the Appropriations Committee. The legislative session ultimately concluded without the bill being brought to a vote.
Although AHCT had not weighed in on the bill during public comment in the committee process, on the morning of June 7, Access Health CT Government Affairs and Communications Manager and former Democratic state representative Kathleen Tallarita sent an email to members of the General Assembly urging them to oppose it.
Among AHCT’s primary concerns was money. Connecticut’s health insurance exchange is funded largely through assessments made on health insurance premiums which bring roughly $31.4 million to AHCT and, according to the email, allowing association health plans would decrease their revenue stream.
“Association Health Plans will also harm the Connecticut Health Insurance Exchange/Access Health CT (AHCT) by decreasing the pool of premiums subject to the Exchange’s assessment, which is how the legislature establish (sic) the organization to fund its daily operations,” Tallarita wrote. “The Exchange cannot assess Association Health Plans or large group premiums, thus cutting more than 48% of its funding availability. Access Health CT strongly urges against passage of this bill.”
The email also contained a section called “The FACTS,” saying association plans do not help consumers because they “seek younger, healthier members as a way to reduce healthcare costs, rather than spreading the risk across a broader risk pool;” and association plans “will not be required to provide coverage for the Essential Health Benefits under the Affordable Care Act pursuant to the state’s benchmark plan like the plans on the Exchange and will not include all of the consumer protections provided by regulations of the Insurance Department.”
The latter point, however, is disputed by the Office of Legislative Research, which determined that under the legislation, association health plans known as Multiple Employer Welfare Arrangements (MEWAs) would have to adhere to rules and regulations established under the Affordable Care Act, offering a minimum of the ACA’s Bronze plan, and self-funded association plans must be licensed through the Connecticut Insurance Department.
“However, the bill requires both self-funded and fully insured MEWAs to comply with certain federal laws, which generally establish minimum consumer protections,” OLR wrote in their analysis.
A separate analysis of the bill by the Office of Fiscal Analysis (OFA) found it could result in less state government revenue, particularly for AHCT. While 48 percent of Access Health CT’s funding does come from fees levied on small group premiums, according to OFA, decreasing Access Health’s revenue by 48 percent would entail every small group plan in the state switching to a MEWA.
Although the email went out before 9 AM on the last day of session — a tumultuous day during which many bills are passed in rapid succession — whether AHCT’s email went out before or after House Speaker Matthew Ritter, D-Hartford, announced the bill would not be called is unclear.
Rep. Kerry Wood, D-Rocky Hill, co-chair of the Insurance and Real Estate Committee and a strong proponent of the bill, says she is requesting a meeting with AHCT to find out what happened and why they sent the last-minute email to lawmakers.
“I was really shocked because the email has no correct information in it,” Wood said. “So, I have asked for a meeting with Access Health to go over who authored the email and try to understand where they were getting their information from to send that out. Because it’s like they didn’t even read the bill.”
“This was the first time we heard anything from them about it and they had plenty of opportunity to comment on it, so I think the timing on it is very suspect and just the content of the email was very suspect,” Wood said. “So, I just want to have that call with them to figure out where they were getting information to send something like that out and understand what the intent of that was.”
Health insurance costs have been rising significantly in recent years, hurting businesses and individuals alike. The latest rate increase request by insurance companies on and off the exchange to Connecticut’s Insurance Department included an average rate hike of 14.8 percent for small group coverage for employers with 50 or fewer workers. It was the second double-digit rate increase request in two years.
Access Health CT offers small group coverage, but the vast majority of small groups do not use the exchange. AHCT covers roughly 3,800 members through its small group insurance, according to their 2022 annual report. The OFA’s report said fully insured small group health plan enrollment was 107,652 in 2021.
Jeffrey Hogan, a healthcare consultant and advisor out of Farmington who supported the bill, said AHCT was a “conflicted state entity” because it receives revenue through those insurance premiums fees and essentially helped kill the bill, despite support that extended up to the governor’s office.
“This was part of a Hail Mary campaign to kill this by a group of organizations, including Access Health, who ultimately prevailed. It furnished a small cadre of legislators a plausible means of voting against it at the last minute,” Hogan said. “I think the big issue here is that a conflicted branch of state government at the last minute threw in to pile on with a few other small entities who were able to kill this.”
“Access Health CT will be complaining about the insurance rate increases coming out that have been filed for and the hearings that are coming up, yet, ironically, they’re the ones who killed a piece of legislation that would have furnished more and better coverage options,” Hogan said. “A bunch of the representations Access Health made were just completely not factual.”
Reached for comment, Tallarita said the email to legislators was in line with AHCT’s mission to reduce health disparities and improve quality of healthcare.
“Access Health CT’s mission is to decrease the number of uninsured residents, improve the quality of healthcare, and reduce health disparities through an innovative, competitive marketplace that empowers consumers to choose the health coverage that gives them the best value,” Tallarita said in an emailed statement. “We consider it an important part of our role as the state’s health insurance marketplace to share information with state legislators regarding legislation before them and its impact on the residents of Connecticut.”
Although the legislation was heavily supported by business and nonprofit associations, it was also opposed by a number of medical associations and progressive groups who warned the healthcare offered through such associations would allow plans to skirt protections and coverage requirements for members. The issue came to a head when Sen. Matthew Lesser, D-Middletown, attempted to filibuster the bill during an Insurance and Real Estate Committee meeting, squaring off for hours with Rep. Wood.
Lesser ceased his line of questioning after receiving a call from the governor’s office assuring him they would address his concerns.
“Despite the negotiated agreement among all stakeholders, this bill was unfortunately compromised by a deliberate campaign of misinformation and falsehoods,” CBIA President Chris DiPentima said in a press release. “However, it’s clear that we need more small business champions in the legislature. It’s not enough to say you support small businesses – words need to be followed up with action and policy must go above polities.”
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So the gist of AHCT’s argument is that it cannot provide “free” health care to CT residents if businesses pay for lower cost plans for their employees. AHCT needs businesses to pay for higher cost insurance plans so it can get more money by charging a “premium assessment fee” (aka, TAX).