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Press Release


Date: May 17, 2010
Contact: Pamela Reese Finch


Lowering co-pays ultimately increases health insurance costs


Editor’s note: This release is being in advance of and in direct response to, the Physical Therapists lobby day scheduled for tomorrow, Tuesday, May 18, 2010. The Employer Alliance believes it is important to realize that for every action like this, there is a direct impact on health insurance costs.

ALBANY – A proposal aimed at capping co-pays for physical therapy presents a clear example as to why New York’s health insurance costs are among the highest in the nation, according to New York’s largest single-issue grassroots coalition, the Employer Alliance for Affordable Health Care.

Legislation sponsored by Senator Neil Breslin and Assemblyman Kevin A. Cahill (S 4321-A/A08171A) seeks to prohibit health insurance carriers from imposing co-pays exceeding 20% of the total reimbursement amount paid to physical and occupational therapists. For most small business owners, however, it is not the co-pay, but overall insurance costs that present the greatest obstacle to individuals wanting, but perhaps declining to seeking treatment. According to the United Hospital Fund, presently 2.5 New Yorkers are uninsured. Premiums have continued to increase at double-digit rates for more than 10 years. S 4321-A/A08171A is a prime example of how Legislative policy and coverage mandates, in the long run, increase insurance costs.

Lowering co-pays will ultimately increase health insurance costs/Page 2 “Lower co-pays have no benefit to the individual who does’t have and can’t afford health insurance,” said Alliance Chairman Scott Miller, who owns Miller Printing and Litho in Montgomery County. “Additional mandates are not the answer. State leaders should instead focus on finding ways to reduce health insurance costs to give everyone greater access to basic coverage – not lowering co-pays to increase the bottom line of one or two specific providers.”

The State Legislature introduces approximately 100 different bills each year to mandate coverage or procedures to be included in all health insurance policies. These mandates incrementally increase premium costs. The Barents Group estimates that for every 1% increase in premiums, 30,000 New Yorkers lose health insurance. Furthermore, rising costs seem to most acutely impact New York’s sole proprietor and small business owners who lack the capacity to self-insure.

“While the federal government is moving forward on health insurance reform, New York’s legislature should refrain from this type of legislation, which is counterproductive and ultimately, does more harm than good,” said Pamela Reese Finch, executive director of the Employer Alliance for Affordable Health Care. She noted that this bill, coupled with several costly budget considerations, could potentially increase premiums above the 17% statewide average incurred by small businesses this year. “Our members need greater access to affordable products, not another policy that ultimately, increases our cost.”

Jeff Subra, owner of Eskay Metal Fabricating in Western New York and a member of the Employer Alliance Board of Directors, agreed. “Health insurance is not a one-size-fits-all product. It is inappropriate to consider any measure that will decrease out-of-pocket cost, but in the end, make the product more expensive for all health insurance consumers.”

The Employer Alliance for Affordable Health Care is a coalition of more than 3,400 employers and individuals from across New York, representing more than 200,000 working New Yorkers, committed to preserving quality affordable health care.