Legislation Would Allow Small Businesses To Form Health Insurance Purchasing Pools

Main Category: Health Insurance / Medical Insurance
Article Date: 11 Aug 2008 - 9:00 PDT

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Rep. Don Cazayoux (D-La.) on Thursday promoted a bill (HR 6210) that would allow the establishment of statewide or nationwide health insurance purchasing pools for small businesses and self-employed individuals, the Baton Rouge Advocate reports.

The Small Business Health Options Program would provide small businesses with annual tax credits of as much as $1,000 per employee, or $2,000 per family, provided that the companies cover more than 60% of the cost of health insurance premiums for workers. In addition, the legislation would provide self-employed individuals with annual tax credits of as much as $1,800 per employee, or $3,600 per family (Chacko, Baton Rouge Advocate, 8/8). Under the bill, health insurers could not increase premiums in the event that small-business employees become ill or file more claims. The legislation also would establish a Web site to allow the comparison of information about various health plans (Kaiser Daily Health Policy Report, 6/11).

Cazayoux, one of the more than 45 co-sponsors of the bill, said that the legislation would reduce health insurance costs for small businesses through the expansion of risk across a large pool of employees. According to Cazayoux, small businesses on average pay 18% more than large companies for the same level of health insurance for employees. He added that small-business owners, employees and their dependents account for more than 28 million of the almost 47 million uninsured U.S. residents (Baton Rouge Advocate, 8/8).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation.

© 2008 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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