You asked for a brief summary of two health care reform proposals, the Connecticut Healthcare Partnership and the insurance industry's proposal mentioned in the media.

SUMMARY

The 2009 “healthcare partnership” bill proposes to open the state employee health care plan to nonstate public, municipal-related, and small employers for the benefit of their employees and retirees. The comptroller may open the plan to these employer groups if the State Employees' Bargaining Agent Coalition (SEBAC) agrees to incorporate the bill's provisions into its agreements with the state.

According to media reports, the insurance industry proposes to create a health insurance pool for individuals unable to purchase insurance in the commercial market. The insurers would not make eligibility dependent on a person's health status, so long as the state required all individuals to purchase health insurance. To our knowledge, there is not a bill before the legislature at this time that includes this idea.

HEALTHCARE PARTNERSHIP PROPOSAL

The Insurance and Real Estate Committee favorably reported sHB 6582, An Act Establishing the Connecticut Healthcare Partnership (File No. 259, a copy of which is attached. It may be viewed at http: //cgalites/2009/FC/pdf/2009HB-06582-R000259-FC. pdf).

The bill requires the comptroller, if SEBAC consents, to offer coverage under the state plan to the following employers for the benefit of their employees and retirees: (1) nonstate public employers beginning January 1, 2010; (2) municipal-related and nonprofit employers beginning July 1, 2010; and (3) small employers beginning January 1, 2011. The bill also requires the comptroller to convert the state employee health insurance plan from a fully-insured plan to a self-insured plan.

Under the bill, the employer groups may choose to apply for the state plan. If accepted, an employer must sign up for benefit periods of at least two years each. The bill requires the Health Care Costs Containment Committee, a state labor and management committee that exists under agreement with SEBAC, to (1) review certain employer applications for coverage under the state plan and (2) certify to the comptroller in writing if the group will shift a significantly disproportionate share of its employees' medical risks to the state plan. If so, the bill requires the comptroller to decline the group coverage.

The OLR Bill Analysis, which is included in the attached file, provides further details of the proposed Connecticut Healthcare Partnership.

Eligible Employer Groups Defined

The bill defines “nonstate public employer” as a municipality or other state political subdivision, including a board of education, quasi-public agency, or public library. It does not include a municipal-related, nonprofit, or small employer. A “nonstate public employee” is an employee or elected officer of a nonstate public employer.

A “municipal-related employer” is a property management, food service, or school transportation business that contracts with a nonstate public employer. It does not include a nonstate public, nonprofit, or small employer.

A “nonprofit employer” is (1) a nonprofit corporation organized under federal law (26 USC 501) that contracts with the state or receives a portion of its funding from a local, state, or federal government or (2) a tax-exempt organization under federal law (26 USC 501(c)(5)). It does not include a nonstate public, municipal-related, or small employer.

A “small employer” is a person, firm, corporation, limited liability company, partnership, or association actively engaged in business or self-employed for at least three consecutive months that, on at least 50% of its working days during the preceding 12 months, employed 50 or fewer employees and the majority of them in Connecticut. When counting the number of employees, companies that are affiliates under state law or eligible to file a combined tax return are considered one employer. A “small employer” does not include a nonstate public, municipal-related, or nonprofit employer.

Self-Insured Plan

A self-insured plan is one that is not backed by an insurance policy. Instead, the employer funds and administers its benefit plan (i. e. , pays claims covered by the benefit plan from its own money, some of which may come from plan enrollees' contributions toward the cost of coverage). The Connecticut Insurance Department does not have jurisdiction over self-insured plans. Due to federal preemption, state insurance laws requiring specified coverage do not apply to self-insured plans.

INSURANCE INDUSTRY PROPOSAL

Insurance industry officials are proposing an individual insurance pool for people who cannot find or afford health insurance in the private market (Insurers Propose Mandated Coverage: Will Create Pool for Those Who Can't Afford Plans, Hartford Courant. , Feb. 20, 2009, A1). Under the proposal, state law would require each person to obtain health insurance (i. e. , an “individual mandate”) and the pool would accept all individuals regardless of health problems. Currently, a person who applies for an individual health insurance may be rejected based on his or her health status, including preexisting conditions.

The Connecticut Association of Health Plans and Mickey Herbert, chief executive of ConnectiCare, are talking to legislators and business groups about their proposal, according to the Courant. However, to our knowledge, there currently is not a bill before the legislature containing the insurance industry's proposal.

The article is available at http: //proquest. umi. com/pqdweb?did=1648801311&Fmt=3&clientId=61806&RQT=309&VName=PQD.

The Connecticut Association of Health Plans was created in 1987. Its members include Aetna Health Inc. (Connecticut), CIGNA Health Care of Connecticut, Community Health Network of Connecticut, Inc. , ConnectiCare, Inc. , Health Net of the Northeast, Inc. , UnitedHealthcare Oxford Health Plans, and Wellcare of Connecticut, Inc.

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