MONTPELIER — The new health care mandate bill working its way through the Legislature would prevent association health plans and health care sharing ministries from counting as adequate health insurance.
Both options are known to be more affordable health insurance alternatives with lower premiums and less bureaucracy. Without those options, members would then have to join one of the big two health insurance companies — Blue Cross and Blue Shield of Vermont and MVP Health Care — or face a financial penalty.
Association Health Plans, or AHPs, are groups of employees pooling money together to form a health insurance co-op. Sharing ministries are similar, only they are organized through religious organizations and usually require some amount of church participation.
The House Health Care Committee approved the bill last week.
It is generally expected that the penalty for not purchasing insurance will be similar in cost to the cheapest programs offered by the two big providers. Vermonters with incomes under 138 percent of the poverty level should be exempt for the penalty, and those under 250 percent get a half-penalty.
Two AHPs were approved for Vermont, one through the Chambers of Commerce and another through the Business Resource Services, both operational since October 2018.
The most recent newsletter sent from the Vermont Independent Schools Association says about H.524, “The bill would remove these popular new options [AHPs] for small businesses from the market. Efforts to grandfather existing plans were also discussed, but ultimately dismissed as well.”
It adds: “About 5,000 employees are now covered through AHPs and if these plans were eliminated, premiums for these businesses and their employees likely would increase significantly for the 2020 enrollment year.”
AHPs were originally not counted as adequate insurance under the Affordable Care Act, and then the Trump Administration in September 2018 stepped in and issued an executive order to allow them to qualify, as long as they meet the appropriate state requirements.
“The Vermont Chamber is advocating for maintaining AHPs as an option for employers to provide insurance with increased options for price, benefits and plan design,” the Vermont Independent Schools Association newsletter states.
Bill Moore, president of the Central Vermont Chamber of Commerce, told True North that small businesses struggle to provide affordable benefits, especially health care.
He explained what the bill does is require businesses with fewer than 100 employees to leave the AHPs and return to the Vermont Health Connect pool of about 75,000 members. Companies with more than 100 employees can go to a health insurance provider and get a deal based on their employees’ medical history and other factors.
“Unfortunately it’s going to impact the ability of smaller businesses to be competitive and to offer a competitively priced health care package to their employees,” Moore said.
“They lose the value of that group buying power, which makes them totally noncompetitive in terms of being able to purchase benefits for next year should the measure pass.”
Meg Hansen of Vermonters for Healthcare Freedom told True North that the clear majority of the Individual Insurance Mandate Working group last year called for protecting the exemption for the health care sharing ministries.
The faith-based plans work by having members agree to pay each other’s health care bills. Once a health care bill is submitted, the cost sharing network pays a cash payment directly to health care providers at a reduced-rate.
“In spite of hearing from the people, the House Health Care Committee has decided that Vermont should eliminate the religious exemption from the mandate that was offered to health care sharing ministries by Obamacare,” Hansen said.
She noted that Blue Cross and Blue Shield of Vermont had been advocating for getting the ministries disqualified.
“If implemented, the bill could force Vermonters who belong to sharing ministries to forgo health insurance altogether, as many feel that they cannot pay into a system that violates their religious beliefs. How does forcing people to give up health insurance amount to sensible policy making?” Hansen said.
Joel Noble, director of public policy for Samaritan Ministries, told True North that he testified to the working group last year and all of its members except for one were in favor allowing the ministries to continue as legitimate health insurance. The one member who defected was representing Blue Cross Blue Shield.
“It’s really a matter of Blue Cross Blue Shield not wanting the competition,” he said.
Noble said Samaritan Ministries has been operating for 25 years and they pay nearly $30 million in costs every month.
“Their needs are being met, their bills are being paid,” he said. “The idea that they need separate health insurance doesn’t make any sense; there’s no reason why our members should not be able to continue.”
He noted if the Vermont members are forced onto the two big providers, many of them are going to have to be subsidized or forced onto Medicaid, which is only going to further drive up costs overall.
Monthly costs for an individual in a health care sharing ministry can be close to $100 a month and $300 for a family of any size, according to Noble. He said the ministries keep costs down by not having a huge administrative bureaucracy. Also, members are allowed to make all their own choices regarding where to get their service.
Another issue is both MVP and Blue Cross Blue Shield use their money to support elective abortions, meaning members forced out of sharing ministries may have to forgo those options for their religious beliefs or pay the penalty and still not have any insurance.
The bill will next appear on the House floor, and from there, if passed, it would go on to the Senate.