Patrick Defends Small Biz Health Insurance Rate Denials | Advocates say Gov. in danger of missing the big picture
Photo/Matt Bennett
ON THE DEFENSIVE: Gov. Deval Patrick stopped in at Irwin Engineers in Framingham to address the health care cost issue.
It’s obvious that health care costs are an enormous burden, and a serious threat to the viability of small businesses throughout Central Massachusetts.
What’s less obvious is what to do about it. Last week, Gov. Deval Patrick made a swing through MetroWest to again highlight the problem and reinforce his administration’s commitment to controlling health care costs by limiting the size of premium increases proposed by the state’s health insurance companies.
Patrick was in friendly territory at Irwin Engineers Inc. in Framingham. The company’s vice president of operations, Lana Carlsson-Irwin, said in a statement that premiums for family health insurance coverage have increased 101 percent in 10 years at Irwin, even with “significant deductibles.”
The market simply can’t accommodate the kind of salary increase that would allow employees to keep up with health insurance costs,” Carlsson-Irwin said.
In April, on Patrick’s orders, the state Division of Insurance denied 235 of 274 rate increases proposed by health insurance providers for small businesses (under 50 employees). In its denial, the division said the increases were unreasonable and excessive.
In doing so, premiums charged by the providers denied their requested increases are stuck on last year’s levels.
Concrete Assistance
State Sen. Karen Spilka, D-Ashland, joined Patrick last week and said the Senate, too, is “working to implement ways to provide concrete assistance to small businesses.”
The way small business advocates see it, there’s a lot of work to do on that front.
The Patrick administration’s denial of rate increases, while an attention-getting and dramatic step in appearance, doesn’t really do enough to help small businesses deal with health care costs that are quickly getting out of control, said Bill Vernon, the National Federation of Independent Businesses Massachusetts director.
“He’s saying the right things,” Vernon said of Patrick. “But to the extent that he’s talking about capping premiums — I don’t want to defend insurance companies — but that’s not the whole problem.”
Vernon argued that the Patrick administration and the legislature must “get to the cost of health care” not just health insurance.
Patrick “has to expand to the provider side. Larger hospitals are sitting on huge cash reserves, and that’s small business owners’ and their employees’ money,” Vernon said.
What small businesses want is more flexibility, the ability to customize a health insurance plan based on their individual needs, Vernon said.
“If you give the ability to choose and design your own plans, each business can have something different” rather than small businesses being saddled with costs that have nothing to do with their real needs, Vernon said.
“A business that’s run just by a husband and wife has much different needs than a landscaper who employs 10 or 12 young men,” he said. “There’s no silver bullet, but small businesses need and want choices.”
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