Stop-Loss Modernization Act will stabilize small group health insurance market
DENVER — In a victory for small group health insurance market consumers, the “Stop-Loss Modernization Act” passed third reading in the Senate on a bipartisan 21-14 vote. It will now advance to the Governor’s desk.
A conservative approach to protecting and stabilizing the health care market for small businesses, this bill raises the individual attachment point for stop-loss insurance policies in Colorado to $20,000, gives the Insurance Commissioner rule making authority to raise the attachment point based on the consumer price index and bans stop-loss issuers from discriminating against or medically underwriting individual employees, through a practice known as “lasering.”
“Rising healthcare costs continue to be one of the biggest issues facing small employers,” said Dede de Percin, executive director of the Colorado Consumer Health Initiative. “This bill protects the integrity and sustainability of the small group market, in which the vast majority of small employers purchase their healthcare coverage.”
About 93% of employers providing health insurance buy health insurance in the small group market. Twenty-four states currently regulate stop-loss insurance – 19 states have established minimum attachment points, three states ban the sale to small groups, two states regulate stop-loss insurance as health insurance, and four states have proposed new legislation to regulate stop-loss. According to an Urban Institute study, if stop-loss was not regulated at all, premiums in the small group market could increase by 24.8% for individual plans and 19.1% for families in the small group market.
“As the CEO of small business conducting research and policy analysis, I absolutely have to offer health insurance to attract and retain the highest quality employees,” said Jewlya Lynn of Spark Policy Institute in Denver. “I am relieved the bill passed because I know it will stabilize the small group market market so we can continue to offer health insurance to our 12 employees.”
Colorado Consumer Health Initiative represents 50+ Colorado health organizations with more than 500,000 health care consumer members, advocating for affordable, accessible, quality health care for all Coloradans.
Media Release | Mon., May 6, 2013 | Contact: Jenny Davies-Schley, 720-295-9545