The Senate passed legislation on an initial vote allowing more small businesses to self-fund health benefit plans cheaper than those available under the Affordable Care Act.
The Senate voted 37-10 on Wednesday, June 13, to pass House Bill 933. It’s scheduled for a final vote Thursday. The bill allows companies with 16 or more employees to set up their own health benefit plans. The current threshold is 25 employees.
The bill also allows nonprofit entities which have operated for at least 10 years and have members in all 100 counties to establish larger self-funded association health plans. Under AHPs, two or more companies could join to leverage savings through their combined size.
Advocates say hundreds of thousands of North Carolinians could benefit.
“This puts another competitor out there that makes premiums more competitive” for consumers, Sen. Jerry Tillman, R-Randolph, said during floor debate. Democrats tried but failed to amend the bill and impose more government regulation on the plans, including a mandate the plans cover 56 pre-existing conditions.
The health benefit plans would become effective Jan. 1, 2020. They were added during an earlier meeting of the Senate Health Care Committee, which Hise co-chairs, to a bill on school psychologist licensure.
During Senate Rules Committee debate before Wednesday’s floor vote, Sen. Floyd McKissick, D-Durham, raised concerns that the health plans fall outside state insurance regulation, and pushed to delay the bill until next year’s session.
“I just think a lot more detail needs to be fleshed out. I’m not opposed to the concept,” McKissick said. “I don’t see enough details here to tell me consumers will be protected.” He wanted guarantees those offering the plans have the resources to pay claims.
Hise argued against delay.
“I have a lot of constituents every year who are literally being forced into not having insurance because they cannot afford $36,000 or $37,000 a year for them and their spouse to cover a health insurance plan on these [federal exchange] markets,” Hise said. An individual’s contract with the company providing the health plan secures payment, just like a bank loan, he said.
“You and I will probably fundamentally disagree on whether or not there’s enough government regulation to allow private individuals to enter into a contract or not with regards to coverage for health care,” Hise said.
Hise said Obamacare plans are on borrowed time because Congress has repealed the individual insurance mandate. That requirement improved the solvency of exchange plans.
If H.B. 933 passes its final Senate vote, it would return to the House for concurrence.