Published April 2001

Here's one prescription
for affordable insurance

By Carolyn Logue
Guest Editorial

Unique among all 50 states, regulatory compliance is the top worry of Washington small-business owners. Their compatriots in 49 other states rank the soaring costs of health-care premiums as the No. 1 concern.

This is not to say that health-care costs are not a problem for Washington’s businesses. In fact, were it not for the time and money needed to comply with the more than 100,000 pages of state regulations just to do business in Washington, health care easily would regain first place as the biggest difficulty in running an enterprise.

Like its apples, our state’s health-care mess can rightfully bear a “Grown in Washington” sticker. We are just now attempting to reverse the legislative disaster of 1993. That year, well-meaning but shortsighted legislators passed a law that did nothing to expand health care but everything to drive it out of the hands of tens of thousands of Washingtonians.

It is important to remember that no employer is legally required to provide health care. The majority does so out of a moral sense; others, to be honest, do so as a way to attract and keep workers. For whatever reason, business owners desire health care for their employees. But when faced with closing up shop or cutting out health care, there really is no choice.

Before 1993, 65 percent of Washington small-business owners surveyed by the National Federation of Independent Business provided health care for their employees. Today, it is 47 percent — less than half!

In 1993, the Washington Legislature passed one of the nation’s most sweeping health-care reforms. From the womb of this “reform” a crisis was born.

Two years after it was signed into law, lawmakers were forced to repeal provisions demanding every citizen have health insurance and every businesses assist employees with the purchase of a plan.

This did little to alleviate the problem, since legislators refused to abolish other provisions that made the buying and selling of health-care policies an increasingly obsolete transaction.

Demands on insurance companies that they sell coverage to any who applied for health care, allowing people to freely and frequently switch plans, and low — three months — pre-existing illness thresholds teamed to bring the crisis to full flower.

When the dust had settled on the health-care “reform” of 1993, small-business owners, the self-employed and individuals in 32 counties had no place to buy health insurance.

Seeing what “reform” had wrought, lawmakers passed SB 6077 in the last session. Working to lure private health insurers back into the state, SB 6077 limits people from hopping in and out of various individual plans, boosts preexisting illness levels to nine months and establishes a high-risk pool for the sickest 8 percent of the people.

While SB 6077 is a good corrective, much more needs to be done if Washington is to stabilize its health-care patient. Small business is the best place to start. Why? Raw numbers:

— More than 60 percent of the estimated 43 million Americans without health insurance are from families that either own a small business or work for one.

— When small business does provide insurance, 75 percent pay 100 percent of the employee’s premium, and 89 percent offer coverage to dependents.

The state Legislature can provide health-care coverage for the working people without it.

First, it must stop passing mandates on insurance companies to include more and more procedures into their basic — the most cheaply priced — health-care policies.

Lawmakers then should thoroughly assess the impact on health-care costs and premiums of mandated benefit requirements that already have been passed.

Second, legislators should dust off an old law and beef it up.

Under the 1989 “Bare Bones” law, a small business with 25 employees that had not previously provided health insurance must be offered a plan by insurers that was free of the several more expensive mandates.

Reviving the “Bare Bones” law by raising the bar to firms with 50 employees would be a terrific start. Allowing it to include firms that had previously offered health care and updating the exempted mandates to include many passed since 1993 would give it real teeth.

Finally, lawmakers should really research ways to revitalize the private health insurance market and continue the trend intended by SB 6077.

Small business can only hope that such leadership exists in the state.

Carolyn Logue is Washington state Director for the National Federation of Independent Business, which has 600,000 members nationwide with 15,000 in Washington.

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