The Connecticut Business & Industry Association will wind down the medical portion of its Health Connections program, ending a self-funded health coverage option launched less than two years ago to help small businesses navigate a shrinking insurance market.
CBIA President and CEO Chris DiPentima told Hartford Business Journal on Thursday that his organization has stopped accepting new groups and renewals into the program and will phase it out as existing policies expire.
Coverage will continue through the end of each employer’s current policy term, with the final policies expected to end in the spring of 2027.
The decision affects more than 20 small businesses, including CBIA itself.
“We worked hard to make the program viable, but ultimately concluded that continuing the product was not sustainable over the long term,” DiPentima said.
CBIA launched the captive insurance program in September 2024 after several major insurers exited Connecticut’s small-group market. Since 2022, ConnectiCare, Cigna/Oscar, Harvard Pilgrim and Aetna have all withdrawn from the market, leaving just two major carriers serving many small employers, DiPentima said.
The CBIA’s medical product was offered as an alternative for small employers with 10 to 50 workers. Under the arrangement, CBIA formed a captive insurance company that assumed the insurance risk while contracting with outside providers for administrative services, provider networks and pharmacy benefits.
The program ultimately faced many of the same challenges that have plagued the broader small-group market, DiPentima said, including rising stop-loss insurance costs, adverse selection and limited opportunities for small employers to spread risk across a larger pool of participants.
Because Connecticut does not allow businesses to pool employees to obtain health insurance coverage — a practice permitted in some other states — each employer largely remained responsible for its own claims experience.
“If you just have one significant claim, it disrupts the whole group,” DiPentima said.
CBIA for years has advocated for legislation allowing association health plans, or multiple employer welfare arrangements (MEWAs), which would allow small businesses to join together in larger insurance pools. Legislation that would have allowed such plans failed again during this year’s legislative session, and DiPentima said that lack of reform contributed to the program’s demise.
“It’s just another example that the small-group market is fundamentally broken,” he said. “It’s not a market problem, it’s not a people problem, it’s not an effort problem, it’s a legislative problem.”
The program’s shutdown will also result in staff reductions at CBIA, though DiPentima declined to say how many positions will be affected.
CBIA Health Connection’s ancillary benefit offerings — including dental, vision, life and disability coverage — will continue unchanged, he said, adding that those programs serve over a thousand businesses and continue to grow.
CBIA plans to continue lobbying lawmakers for changes to Connecticut’s health insurance laws when the General Assembly reconvenes next year following the November election.
Legislators “continue to be asleep at the wheel, but hopefully we’ll finally get something through next session,” DiPentima said.
