Small Businesses To Lobby Senate on AHPs Bill

The National Federation of Independent Business and 160 other organizations on Thursday began a campaign for the passage of a bill (S 545) that would allow small businesses to band together across state lines to form association health plans, the Washington Times reports. Under the legislation, AHPs would be exempt from states' minimum coverage requirements and subject only to federal coverage standards (Higgins, Washington Times, 4/2). Supporters of AHPs contend that they would decrease administrative costs and allow small businesses to negotiate better rates with insurers, the Chicago Tribune reports (Kaiser, Chicago Tribune, 4/1). The campaign is targeting the Senate, where the bill, called the Small Business Health Fairness Act, is stalled. The House passed the bill in June and previously passed similar legislation six times (Washington Times, 4/2). President Bush favors the measure and has said he will sign it, the Tribune reports (Chicago Tribune, 4/1). To mark the launch of the campaign, the 600,000-member NFIB this week ran a full-page ad in USA Today (Washington Times, 4/2). The group also held a press conference with Sen. Olympia Snowe (R-Maine). Jack Faris, president and CEO of the NFIB, said that the campaign is an effort to "turn up the heat" because the Senate "may not see [the AHP bill] as a priority, but it sure is on Main Street" (Chicago Tribune, 4/1). At the press conference, Labor Secretary Elaine Chao said that AHPs could save small businesses up to 25% on their health insurance premiums, the Times reports. She added that AHPs "give small businesses the same coverage as used in large corporations and unions." Faris said, "Our members are laying down the gauntlet that we are sick and tired of being sick without health insurance" (Washington Times, 4/2).

AHPs face "staunch opposition" from insurers, state government agencies and some small businesses, who contend that AHPs will attract healthier employees, increasing costs for businesses that continue to offer state-regulated plans, the Tribune reports. Jeremy Claeys, director of communications for the National Small Business Association, said that AHPs would "benefi[t] a very small percentage of small businesses" and increase health insurance rates "for most small businesses out there." Jack Ericksen, executive director of congressional relations for the Blue Cross and Blue Shield Association, said that small business groups could act as "unregulated insurance companies" under the measure (Chicago Tribune, 4/1). According to the Census Bureau, 25 million of the 43.6 million uninsured U.S. residents last year were owners, employees or dependents of businesses with fewer than 100 employees (Washington Times, 4/2).