Two Maryland chambers of commerce plan to offer limited health benefits to their roughly 1,000 members starting today, embracing an increasingly popular strategy that aims to help ease health care costs.
The Baltimore/Washington Corridor Chamber of Commerce and the Maryland Hispanic Chamber of Commerce joined forces to create the benefits, which they plan to unveil today at a news briefing in Laurel. The chambers say they will be the first in Maryland to offer coverage as a perquisite of membership.
"This is not intended to replace or be a major medical insurance program," said H. Walter Townshend, president and chief executive of the Baltimore/Washington chamber. "We just want to give our members access to health care in a way that's more affordable to them and to their employees."
The chambers will offer three "Corridor Care" plans that reimburse a fixed amount for doctor's office visits, diagnostic tests, child wellness visits, hospitalization and surgery. The higher the premium, the higher the reimbursement. For instance, the "value" plan reimburses $30 for a doctor's visit while the "standard" plan pays $40 and the "enhanced" plan kicks in $50.
Employers need not contribute to the coverage, leaving it up to each employee to pay premiums that range from $43 to $227 a month, depending on age and level of plan. Older workers pay more. Employers can chip in any amount they wish but must pay at least 50 percent of a single employee's premium if they wish to get group rates.
Jon Gabel, vice president of the District-based think tank Center for Studying Health System Change, said these types of limited-benefits plans have proliferated as more people got priced out of the traditional insurance market.
Many of those people work. The most recent U.S. Census data shows that 74 percent of the nation's 45 million uninsured individuals held jobs in 2003. Most worked full time and year-round in small businesses. Others worked part time or in seasonal jobs.
Whatever the situation, the majority were not eligible for employer-sponsored health plans, which are typically the most comprehensive and cheapest because employers pick up a big chunk of the premium payments.
Gabel said family coverage costs an average of $10,800 a year, more than a minimum-wage worker earns in a year. The typical year-round, minimum-wage worker earns about $10,300 annually, Gabel said.
"Limited health care benefits are better than nothing. That's the good news," Gabel said. "The bad news is these people will be underinsured."
Companies most likely to tap into the plans are smaller ones that are struggling to grow and hold onto valued workers, said Ricardo Martinez, chairman of the Maryland Hispanic Chamber of Commerce, which has 30 members, including local chambers that total 300 businesses.
"We want to make sure that health benefits are available to anyone who needs them," Martinez said. "At the same time, we recognize there are folks who need time to become solvent as a business so they can afford to offer full-blown insurance to their employees."
The Hispanic chamber teamed with the Baltimore/Washington chamber in part because 78 percent of Maryland's Hispanic population resides within the counties represented by the latter chamber, including Anne Arundel, Howard, Montgomery and Prince George's.
Their joint Corridor Care policies require no deductibles and provide a discount card for prescription drugs and dental, vision and other health care costs. Markel Insurance Co., which insures these policies, has teamed with the Alliance Preferred Provider Organization network so patients who use one of the participating providers receive discounted rates.
The Corridor Care plans will be administered by Towson-based C.O.B. Inc. and Columbia-based Employee Security Inc.
Joel Sachs, executive vice president of Employee Security, said such plans have been around for at least five years, adopted mostly by associations and chambers, including several in Virginia.
"The market we're trying to reach are those people who can't afford regular insurance but don't qualify for other coverage, such as Medicaid," Sachs said.
Lynda L. Sussman, executive vice president and co-owner of C.O.B., said the plans are a viable alternative for businesses in a state where insurance rates have become expensive in part because state regulations forbid carriers from customizing policies for small groups.
"I'm not an apologist for insurance companies," Sussman said. "But we're all doing business here, and some carriers couldn't make it work in our market."