🔒Amid declining market, CBIA unveils new self-funded health coverage option for small, medium biz

It’s not what it had hoped to offer, but the Connecticut Business & Industry Association (CBIA) on Thursday launched a new program it says will provide small and medium-sized businesses access to more affordable healthcare coverage.

Available through CBIA’s Health Connections, the program is intended to help address the offerings decline in the small group health insurance market. 

Just this year, Cigna Healthcare and New York-based technology company Oscar in May informed policyholders in the state that they will end their plan, which was launched jointly a few years ago. That was followed in June by Aetna announcing it will also exit the market.

“Small and medium businesses and their employees have battled rising costs and shrinking options for a number of years and desperately need robust, affordable health benefits,” said CBIA President and CEO Chris DiPentima.

Ken Comeau, president of CBIA Service Corp., which manages Health Connections, said the new program is intended for businesses with a minimum of 10 employees and for those with up to 150 to 200 employees. It offers three preferred provider organization (PPO) plans and three health savings account (HSA) compatible plans.

The program is self-funded by employers and provides “broad medical benefits and access to a national network of providers,” CBIA said.

Each employer in the program will be level-funded, which means they contribute a regular monthly payment to cover costs for administration, claims payments and stop-loss insurance coverage, which protects against deficits, CBIA said. The stop-loss coverage is provided by Skyward Specialty Insurance through its subsidiary, Great Midwest Insurance Co.

Unlike other self-funded plans, though, employers will also benefit from the return of 100% of any surplus claims dollars annually.

“In many of the products that are out there today, it’s 40% or 50% of the surplus that gets returned,” Comeau said. “What we’re doing is returning 100%, because in our view it’s the employers’ money.”

Another key feature of the program is enhanced member services, which provide enrolled employees and their dependents with one place to call for help with disease and care management. 

“While CBIA is the front end, handling enrollment, eligibility, billing and so on, we pass that data on to SNS Health,” a claims administrator, Comeau said. 

CBIA also will use the services of Ventegra, a California-based nonprofit public benefit corporation that operates nationwide as a medical benefit manager to help keep pharmacy costs in check. It said the company has consistently produced savings greater than 20% when compared to the national average for medication spending.

'Need more choice'

CBIA hoped state lawmakers, during their legislative session earlier this year, would approve bipartisan legislation addressing the shrinking options in the fully-insured small group market. For the second consecutive year, however, the bill was not approved.

The bill would have allowed qualifying chambers of commerce and trade associations to aggregate their respective memberships and offer regulated, self-funded health benefit arrangements — essentially acting as one large employer.

“That was a major disappointment, given that the legislation would positively impact hundreds of thousands of small business employees across the state,” DiPentima said. 

That lack of legislative action, he said, led CBIA’s board of directors to authorize developing a value-based program that “focuses on benefit offerings that small employers can’t access today.”

Still, DiPentima said CBIA’s program does not solve the problem in a way the legislation would.

Unlike the bill, which would allow pooling employees into a large group, each employer using CBIA’s new program still stands alone, he said.

“Every employer stands on their own for their administration cost, for their claims costs, and so on,” DiPentima said. 

He added that the new program also doesn’t serve businesses with fewer than 10 employees.

“I call those businesses ‘micro’ businesses,” DiPentima said. “They still need more choice out there. It can’t just be the fully insured market or go to the (CT Health Exchange). You need more choices than that. … We’ve got to get more solutions out there.”