Amir Bajoghli is president of the Medical Society of Northern Virginia.
Virginia Gov. Ralph Northam (D) vetoed three health insurance bills that would have made it possible for small-business owners and independent contractors to band together and purchase group health insurance plans at competitive rates.
These group health insurance plans sponsored by associations, known as multiple-employer welfare arrangements, are fully funded or self-funded by a benefits consortium of small-business employers who pool their resources together to offer their employees comprehensive affordable group health coverage on terms similar to those available to larger employers. Multiple-employer welfare arrangement plans offer competitive rates thanks to the larger risk pooling for the participating small groups and an opportunity for small-business owners to offer their employees health-coverage benefits.
Two bills, S.B. 1689 , sponsored by Virginia state Sen. Siobhan S. Dunnavant (R-Henrico), and H.B. 2443, sponsored by Del. Tony O. Wilt (R-Rockingham), would have allowed the creation of nonprofit “benefits consortiums” and sponsoring associations to offer health plans. A third bill, S.B. 1674, co-sponsored by state Sens. William R. DeSteph Jr. (R-Virginia Beach) and Bryce E. Reeves (R-Spotsylvania), would have allowed the purchase of short-term policies of up to 364 days with federal approval.
Northam’s veto of these three bills restricts consumer choice. In Northern Virginia, just three health insurance companies offer individual health plans through HealthCare.gov. The choices are even narrower in Loudoun County, where only two offer plans. Second, less consumer choice will continue to be a major driver of premium cost growth at the expense of the consumer. Rates on the exchange for mid-tier plans have experienced exponential premium increases over the years. Because small-business owners and independent contractors earning median incomes do not qualify for premium subsidies, they are now forced to continue to endure annual premium increases with limited options.
Northam’s vetos enact a false sense of choice by rewarding insurance companies at the expense of small-business owners and independent contractors who contribute substantially to the state and local economies. Group health insurance plans sponsored by associations are not in direct competition with the individual marketplace. Rather, these plans live up to the spirit of the Affordable Care Act’s intent to provide not just more access but also affordable access.
The Medical Society of Northern Virginia, like other professional associations in the commonwealth, would like to create a multiple-employer welfare arrangement for its members to live up to the spirit of ACA in a way that benefits all by providing consumers with choices and an ability to pool resources to negotiate lower rates.
While we disagree with Northam’s recent vetoes, we remain committed to engaging with his administration to advocate marketplace fairness where insurance companies make these affordable plans available to associations and their members.