Massachusetts Health Insurance Costs Face New Regulations
February 2011
Families and business owners struggling to purchase small business health insurance will have a leg-up in Massachusetts this year, thanks to some new state regulations designed to cut costs.
A bill signed into law this past August by Governor Deval Patrick aims to keep
Massachusetts health insurance costs lower for small business owners. The new bill will allow small business owners to band together in order to bargain for better health coverage costs with insurance companies.
Unlike larger corporations, smaller businesses lack the bargaining power needed to negotiate lower prices on health coverage. Larger companies can rely on the number of employees to lower their costs; group health insurance is less risky for insurance companies, and more likely to come in at lower prices and to offer better coverage.
But
small business health insurance is almost as expensive as individual coverage, since insurance companies are taking a larger risk with a smaller group of people. It's just more likely that someone will get sick or injured, and require expensive care, in a smaller group.
By allowing small business owners to band together they will be able to negotiate lower costs for Massachusetts health insurance, and offer better benefits to their employees too.
Facts on:
Small Business Health Insurance
Did you know...
Small business owners are often unable to offer employees health coverage based on excessive costs.
|
This, in turn, incentivizes employees to stick around and work for smaller businesses. It's traditionally more difficult to hire for small business owners, and turnaround can be steep.
The regulations for small business health insurance will begin in April, after which time business owners can petition to be included in one of six cooperatives that will negotiate
health coverage costs.
However, these cooperatives have a cap - only 85,000 people will be able to join and enjoy lower cost Massachusetts health insurance with improved benefits.
Business owners interested in joining the cooperatives are encouraged to contact the State Health Insurance Office for more information.
Recent Topics:
