Two new Virginia laws will create health insurance options for two groups of companies that have felt excluded from more affordable coverage.
One allows associations to set up a benefit consortium to help small businesses acquire the same purchasing power that large employers have to insure employees.
“It’s about access to health care, something I’ve worked on all my career, and accessibility,” said U.S. Sen. Monty Mason, D-Williamsburg, who sponsored the measure.
He said the law would help small businesses – those with between 2 and 50 employees – attract and retain labor by offering health coverage to workers and their families,
The other new law allows the Virginia Brokers Association to arrange group insurance for its members.
“This is a way to make health insurance more affordable,” said Del Keith Hodges, R-Urbanna, who sponsors the real estate brokers’ group insurance account.
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Both proposals have been battlefields for years, countering fears that they will take enough people out of the Affordable Care Act’s health insurance market to raise premiums for everyone else.
The idea behind the Compensation Consortium bill, as presented to the General Assembly, is that it will allow groups such as the Virginia Chamber of Commerce to create a mechanism that allows small businesses to access the relatively low bonuses that large employers can afford. command.
Mason said the idea was for the consortium to bring together tens of thousands of small business employees; by spreading the risks over such a large number, the cost per person is lower. The consortium will be managed by a board of directors. Any surplus of income over claims and required reserves will be used to retain future premiums.
Mason said he had started working on the proposal – his first effort was in 2020 – not after giving a speech to a House committee, saying he thought the idea was bad.
“They asked if we could talk about it, and after they explained what he could do, I said, ‘If you decide to go ahead, let me know, and I’ll do it,'” Mason said.
“We intend to form a consortium for benefits,” said Laura Ramtun, the chamber’s director of communications and marketing.
The chamber is waiting for the state insurance bureau to write regulations, she said.
In principle, the law says that associations will be able to create something like a self-supporting pool, which many large employers use, and provide coverage to small businesses. In self-insurance, instead of buying a policy and relying on the insurer’s financial resources to cover damages, the employer invests its own funds, usually hiring a company to implement the program.
The coverage of the consortium will have to include all the health benefits required by the Affordable Care Act, as well as the sharing of the costs and value of the coverage standards in this law. He will be barred from refusing coverage for pre-existing conditions.
Like workers’ compensation insurance, it will set a base rate for participating companies and, since the actual experience of companies with claims is zero, their specific premiums will be fixed at certain percentages above, at or below base rates, while trends for the whole pool will determine future base rates.
The real estate broker’s bill takes a different approach, giving individual members a way to buy insurance policies at rates such as group-quoted rather than individual market premiums, said Martin Johnson, senior vice president of the government relations association.
For some, their incomes are high enough to prevent them from benefiting from subsidies under the Affordable Care Act. For others who may not be doing well or who are just starting their careers, even with grants, bonuses may be hard to afford.
“Real estate organizers are not like other professionals: they are mostly independent contractors. So they can only get insurance on the individual market, “Hodges said.
He said two key points helped him justify the bill: the first was that about 20% of real estate brokers had no insurance, so his bill would reduce the number of uninsured Virginians by several thousand.
The second key point was that the bill says that any plan that brokers ultimately organize must include at least all the basic benefits required in the Affordable Care Act’s plans.
This was important because previous efforts for alternative health coverage, such as extending short-term coverage periods, failed when health plans and other opponents said their narrower set of benefits would distract too many healthy people from ACA plans. . The result will be a spiral of premium increases.
What the bill allows is for the association to buy a group insurance policy for them – mainly for the same type of group coverage that larger companies now buy if they do not choose a self-insurance program, Johnson said.
The association talks to insurers and the Insurance Bureau to see how this can work; whether it will continue will depend on the type of interest rates quoted, Johnson said.
For real estate brokers who get their insurance through the ACA’s individual market, but who are trying to stretch their dollars by not buying as much coverage as they may need, his bill will provide an opportunity to address their insufficient coverage, said Hodges.
After intense debates before General Assembly committees over the past few years, “there is not much left to debate about what is having an adverse effect,” said Doug Gray, executive director of the Virginia Health Plan Association.
The final version of the aid consortium bill passed the U.S. Senate 40-0 and the House 63-35. The brokers bill passed the House of Representatives 95-2 and the Senate 40-0.
Dave Res, 757-247-4535, [email protected]