One of Colorado’s largest business groups on Monday urged Gov. Bill Ritter to veto a bill that would prohibit insurers from considering employees’ health and claims histories when setting health insurance premiums for small businesses.
The Colorado Association of Commerce and Industry, the statewide chamber of commerce, said during a news conference Monday at the state Capitol that House Bill 1355 could result in rate hikes for nearly two- thirds of small businesses in Colorado. That in turn could prompt healthy people to drop their coverage, potentially pushing insurance premiums higher overall, the group said.
“We are concerned about the potential aftermath of this bill,” said Ralph Pollack, an official with the association.
The bill, which applies only to businesses with 50 or fewer workers, would essentially reverse a 2003 legislative change that allowed insurance companies to offer premium discounts to businesses with relatively healthier workers.
HB 1355 has already passed the House and Senate and is awaiting a decision by Ritter. Spokesman Evan Dreyer said Ritter is still considering the bill.
Supporters of the bill contend it could reduce insurance costs for small businesses and make it easier for small-business owners to budget for health care costs.
Employers from year to year can swing from a “low-rate band” to a “high-rate band,” depending on the number of claims and health status of employees. If passed into law, insurers would still be allowed to use five other factors when setting premiums, including age, family size and tobacco use.
The National Federation of Independent Business supports the bill, pointing out that 65 percent of its members in Colorado oppose the use of claims history and health status in setting group premiums.
The bill “is opposed mainly by just two groups: health carriers and insurance brokers,” the federation said in a statement issued Monday. “The health-insurance industry should stop looking upon HB 1355 as a threat and instead see it as an opportunity … to make health care more affordable for the small-business owner.”
Many states, including New Hampshire, Massachusetts and Maryland, have passed legislation prohibiting insurers from using health status and claims history when setting insurance premiums for businesses.
Dede de Percin, executive director of the Colorado Consumer Health Initiative, said the bill’s passage would likely decrease the number of uninsured people in Colorado and encourage those with insurance to seek preventive care.
“There is no way to move forward with health care reform with rate bands,” she said.
Staff writer Will Shanley can be reached at 303-954-1260 or wshanley@denverpost.com.
