Health care options for small business owners would expand under proposal before Congress

The AVMA and numerous other professional and trade associations are encouraging Congress to adopt legislation that would federalize insurance standards pertaining to small businesses and associations so they could offer health insurance to their members and their members' employees in all the states.

Proponents of the Small Business Health Fairness Act of 2001 (H.R. 1774/ S. 858) say passage of the bill would allow millions of uninsured Americans who are either self-employed or employed by a small business to purchase low-cost, quality health care for themselves and their families.

What's more, a provision in the legislation would expand Association Health Plans so associations could pool their members to have the same purchasing power and health care plan options that are available to employees of large companies and labor union members. This group rate could cut costs by as much as 30 percent.

What the bill does is exempt association-sponsored health plans from state laws and state health mandates that are seen as restrictive. Insurance laws and regulations vary from state to state and can discourage providers from offering coverage. For instance, state regulations prevent the AVMA Group Health and Life Insurance Trust from selling individual member health care plans in Maine, Massachusetts, New Hampshire, New Jersey, North Dakota, Vermont, and Washington.

The AVMA sees the legislation as an opportunity for GHLIT to offer health coverage to members in all the states, and it also possibly opens the way for development of an employer plan.

In 1956, GHLIT began offering the Employer Plan to members so that practice owners could provide health care, short-term disability, and life insurance for nonveterinary staff. Over the years, mounting state regulations and rising coverage costs threatened GHLIT's ability to maintain the individual member program, resulting in the decision to discontinue staff coverage in 1994. Since then, GHLIT has been looking for an opportunity to reestablish the staff plans for practice owners, while also preserving the individual member program.

"It looks like what is being proposed [in Congress] is an excellent chance of accomplishing this," said Dr. R. Tracy Rhodes, AVMA Executive Board member and board representative to the Committee on Wellness.

Representative Ernest Fletcher and Sen. Tim Hutchinson introduced the measure nearly a year ago. The bill was amended to the House version of the so-called patient's bill of rights that passed last August. But when the Senate passed its version, it did not include the amendment. The patient's bill of rights legislation has lingered in conference for months, and it is uncertain when and if it will emerge.

In March, the AVMA added its name to the Association Health Plan Coalition, made up of more than 80 professional and trade associations lobbying to push the bill forward, despite the roadblock. President Bush, along with a bipartisan group of lawmakers, believes the bill can help small businesses purchase affordable health care plans for staff.

"It makes sense," Bush said to employees at a Missouri manufacturing company in March. "And so I'm calling on [Congress] to give this plan a hard look, and get it passed for the good of the American economy."

The only qualification to AVMA support is ensuring that the bill not negatively impact the Association's member plan, noted Dr. Janet Donlin, AVMA associate executive vice president and ex officio trustee to GHLIT.

Powerful forces are aligning themselves against the bill, however. Some politicians oppose it for ideologic reasons, favoring universal health care coverage, according to Dr. Dean Goeldner, assistant director of the AVMA Governmental Relations Division. There is also criticism that, under the plan, only the healthiest of the uninsured—workers—would receive health benefits, leaving the unemployed without coverage.

Also, the insurance industry does not want increased competition to write coverage that would result from an expanded plan, Dr. Goeldner explained, whereas state insurance commissioners worry that employees might receive inadequate coverage under a program exempt from state mandates.

The AVMA is encouraging members to contact their representatives in Washington, D.C., to support passage of the Small Business Health Fairness Act of 2001.