DC small business owners who want to provide health insurance to their workers often face a dilemma: limited choices of insurance plans, few doctors within those plans, and skyrocketing premiums, even for high-deductible options.
In Sunday’s Washington Post, Jill Thorpe explained how implementation of federal health reform in DC — particularly the creation of the DC’s health insurance exchange — will make it much easier for her husband’s small architecture firm to offer quality health insurance to its employees. The company currently pays $18,000 annually for a worker’s family health plan that has a $5,000 deductible. Premiums have jumped 22 percent year recently.
Thorpe writes that the exchange will create more predictable and affordable health insurance options for small businesses, allowing them to do the right thing and compete with larger firms for good workers. Thorpe’s column is eye-opening given the recent uproar over DC’s xxchange plans from some small business groups, who warn of dire consequences and gloss over the realities of the current dysfunctional small group insurance market.
Thorpe notes that the DC exchange offers many mechanisms to address the needs of small employers. Creating a unified market with an online portal will allow consumers to compare all health plans in the exchange side-by-side, with information on out-of-pocket expenses, network of doctors, and quality ratings. The exchange will set minimum quality standards, which will ensure that small employers have access to plans with an adequate level of services and a robust network of doctors and specialists. Right now, the only plans affordable to small businesses offer bare-bones networks and services.
Finally, DC’s plan to merge the individual and small group risk-pools could decrease the high variation in premiums from year-to-year and slow their growth over time. While there may be short-term price increases for small businesses, from adding in the individual market, this will be offset by tax credits that will cover as much as 50 percent of premium costs for small businesses.
Families USA and the DC Fiscal Policy Institute have created a fact sheet that offers more information on DC’s health care exchange and how it will benefit small businesses and their employees. With time, the exchange should bring a more competitive and vibrant market that provides a robust offering of quality and affordable health plans for District workers.
