Pennsylvania House Passes Most Expensive Mandate in State History

Harrisburg, Pennsylvania, UNITED STATES


HARRISBURG, Pa., July 16, 2007 (PRIME NEWSWIRE) -- The Pennsylvania Chamber of Business and Industry expressed its disappointment with action taken by the State House on Saturday in passing the 38th and most expensive health insurance mandate in the history of the Commonwealth.

House Bill 1150, which would mandate health insurance coverage for autism spectrum disorders, passed unanimously, despite attempts by state Reps. Scott Boyd, R-Lancaster, and Steve Nickol, R-Hanover, to minimize the financial impact on Pennsylvania businesses.

"With employers of all sizes struggling with rising health-care costs and double-digit premium increases, passage of this mandate will result in additional premium increases of at least four percent," said Floyd Warner, president of the PA Chamber.

"The chamber sympathizes with families caring for autistic children and recognizes the complexity of this issue, as it also recognizes the difficulties faced by anyone who is or has a friend or family member battling a specific illness or condition for which new mandates are being proposed," Warner said. "But this mandate was rushed through the legislative process without sufficient discussion.

"Those paying for the coverage, mainly small and medium-sized businesses, and those providing the coverage were hardly heard," he continued, adding that promises of cost estimates and projections and promises of working on reducing the cost impact on small employers remain just that -- promises.

When viewed cumulatively, state mandated benefits increase the cost of providing health insurance. A recent national study revealed that benefit mandates and regulation are responsible for 15 percent of health-care cost increases, adding an estimated $10 billion to the nation's health-care costs.

"The impact of these mandates imposes additional financial burdens on the payers of health insurance, whether they are public or private," Warner said. "These burdens would be imposed on the very businesses providing family-sustaining jobs, paying good wages and offering health-care benefits."

Warner said many of the services mandated by H.B. 1150 are already covered under Pennsylvania's Medical Assistance program, which is one of the most generous in the nation in covering all children with autism, regardless of income or type of insurance coverage.

"This legislation would result in a cost shift from the public to the private sector that would fall directly on businesses and individuals, particularly those that are unable to self-insure and least able to absorb premium increases," Warner noted.

Studies have not only shown that mandated benefits raise the cost of health insurance but also that each new benefit increases by 1.5 percent the likelihood that a small business may not be able to afford or offer coverage.

Warner said H.B. 1150 is bad for many Pennsylvanians with autism since they will pay deductibles and co-insurance (and higher rates) than what they now pay under MA, which is dollar-one coverage. More importantly, the mandate is inequitable in that some employers and their employees will be paying twice for coverage -- once in taxes that fund the MA program and once in increased insurance premiums.

"In essence, enacting benefit mandates has the opposite effect than the intended purpose of covering more individuals, and increases the number of working uninsured," Warner said. "House Bill 1150 will not make treatment of autism better or more available, just more expensive for those employers (and their employees) that are unable to self-insure.

"At a time when health-care costs continue to increase, passing another mandated benefit is both counterproductive and imprudent," Warner concluded. "This is the last thing Pennsylvania should be doing as elected officials and stakeholder groups continue the challenging task of reaching a consensus on solutions to the state's health-care affordability and accessibility crisis."

The Pennsylvania Chamber of Business and Industry is the state's largest broad-based business association, serving more than 24,000 members and customers statewide. More information is available on the PA Chamber's website at www.pachamber.org.

The Pennsylvania Chamber of Business and Industry logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=353



        

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