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Press Release
Sept. 06, 2007

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Alliance Testimony Focuses on Small Business Concerns at Governor’s Public Hearings on Universal Coverage - 09/06/07 

The small business community pays higher health insurance premiums and also significantly underwrites the state’s health care system through various fees and taxes, so any consideration of universal health care coverage must support, not penalize New York employers, testified Jeff Leland, chair of the Employer Alliance for Affordable Health Care.

"As we pursue universal health insurance coverage and the financing of such a system, we must ensure that that the cost of this coverage is also shared universally and in a broad-based manner not disproportionately placed on responsible employers already providing coverage as is the case today," he testified in Glens Falls at the first of six scheduled public hearings being held in connection with Governor Eliot Spitzer's "Partnership for Coverage" initiative. “

Employer-based coverage continues to decline, leaving publicly subsidized programs to fill in the gap, Leland said. However, the push toward additional government subsidized proposals raises the obvious concern of who will underwrite the cost and stressed that any added cost should NOT be placed on the business community. Instead, the government must consider incremental steps to achieve universal coverage and increase access to employer-based coverage without fundamentally restructuring the health care system, imposing significant new costs or creating new distortions in the health insurance market. These options include:

  • Personal responsibility - Health insurance is the only type of insurance where typically the primary purchaser is not the primary user. Incorporating aggressive wellness and vaccination programs and empowering people to make healthier choices in terms of diet, exercise and lifestyle that will result overall benefit to their well-being.
  • Develop a broad-based approached to underwrite subsidized coverage - The cost of universal health coverage must be borne by a universal tax. New York’s business community not only pays among the highest premiums in the country, but also is largely responsible for underwriting the healthcare system through $2.5 billion dollars in special fees, assessments and surcharges authorized by the Health Care Reform Act (HCRA).
  • Eliminate the Covered Lives Assessment - The Covered Lives Assessment to underwrite Graduate Medical Education costs premium payers $850 million annually. New York is the only state in the nation to underwrite physician training in this manner. We must look at alternative ways to pay for medical training. It is time to rescind the covered lives assessment, or, at the very least, spread the burden equally by paying for this training through the state’s general fund.
  • Eliminate the patient services surcharge - This fee of 8.95% is placed on the privately insured to cover bad debt and charity for hospitals and other HCRA needs. Presumably, if there is universal coverage, there will be no need for charity care. Eliminating this surcharge will reduce premium costs, increase accessibility and enhance employer-based coverage. If we must continue to underwrite some level of bad debt and charity costs, then it should not come only from businesses, but be assessed progressively on all New York taxpayers again assuring that the cost of universal health care is shared by all.
  • Allow small employers to purchase "mandate lite," high deductible policies - By eliminating some or all of the state-mandated benefits imposed on fully-insured policies consumer will have access to a more affordable product that might be better tailored to meet their needs. Enhancing premium payer choice in private insurance packages is a key component in keeping people insured.
  • Share savings dividends with employers - Any universal health system in New York will include savings derived from Medicaid efficiencies including reduced charitable emergency room visits and overall quality improvements. These savings should be shared with employers to further support coverage in the private sector and should serve as a brake against increasing premiums.

The Employer Alliance for Affordable Health Care is the largest single-issue grassroots business coalition in New York State with more than 3,400 members representing hundreds of thousands of working New Yorkers. A complete copy of Mr. Leland’s testimony is available on-line at www.employeralliance.com.