As Bloomfield health insurer Cigna prepares to re-enter the state’s small group market with a new plan for employers with 50 or fewer workers, Connecticut’s health insurance landscape remains somewhat uncertain.
Gov. Ned Lamont, progressive Democrats and Republicans have all recently unveiled plans that would reform the healthcare industry. While the plans differ, there seems to be bipartisan agreement that the cost of health care for small businesses and individuals is too high and unsustainable long term.
The most notable and controversial proposal is one put forward by Democratic state lawmakers that would set up a state-run health insurance plan for small business and nonprofit workers to be implemented and run by the office of the state’s comptroller, Kevin Lembo.
Essentially it would allow those groups, and potentially others, to buy into the state employee health plan.
Business groups including the Connecticut Business & Industry Association and Connecticut Association of Health Plans, which represents the state’s health plans, are lobbying strongly against it, arguing it could potentially add significant costs to state government, directly compete with one of the state’s most important industries, and lead to a single payer system. Health insurers employ well over 10,000 people in the state.
Lembo, a main proponent of the public option, has argued that insurers have had years to bring to market new and more affordable plans for businesses and individuals, but haven’t done so, forcing the state to step in.
Meanwhile, Lamont has proposed creating additional subsidies for people who buy insurance on the state’s health insurance exchange. The subsidies would be paid for by a new tax on health insurers that would raise an estimated $50 million annually.
Lamont also wants to limit annual increases on prescription-drug costs, creating opposition from the state’s pharmaceutical industry.
Democrats in the General Assembly also support the new tax on health insurers.
Finally, Republicans want to establish a reinsurance program that would shield insurers from exorbitant claims, and therefore help mitigate major premium hikes on small businesses and individuals. The GOP also wants to establish healthcare cost growth benchmarks and import cheaper prescription drugs from Canada.
Policymakers will spend the next few months debating the issue. The legislative session ends in early June.
