“If you like your current health plan, you can keep it.” Maybe. Maybe not – likely not – for thousands of Maine small businesses and their employees.

The Maine chapter of the National Federation of Independent Business and the Maine State Chamber of Commerce have concerns about how Clear Choice standardization might affect Maine’s small-business health insurance market and the cost of the plan options. Jack_the_sparow/Shutterstock.com

Rulemaking is underway that will have a major impact on small businesses and individuals in Maine. The change results from legislation passed last year that directs the Bureau of Insurance to develop “Clear Choice” plan design and options in these distinctly different health insurance markets.

While shopping for health insurance can be daunting, the marketplace presents consumers with an array of plan options, and with that array comes flexibility. Small businesses shop for policies for their employees based on plan design and, importantly, on the affordability of those designs. What do workers want? What are the overall benefits and cost package for them and the small business?

Clear Choice plan design will collapse the large array of options available today into a handful of options to both standardize plans and make it easier to pick a plan.

Sounds reasonable. But there are trade-offs for “easier to pick” that will be disruptive. Our organizations, which represent Maine’s smallest businesses (NFIB members are all small businesses, and about half of Maine State Chamber of Commerce members are small businesses), have concerns about how such Clear Choice “standardization” might affect the market and the cost of these plan options.

As we indicated to the Bureau of Insurance, while simplicity has its benefits, limiting the number of plans made available to small businesses and individuals has its costs. Simplicity eliminates purchasing flexibility for those same groups. And employers need flexibility in choosing the plan that best fits their particular needs, including the need to retain and attract workers in a competitive job market where larger companies are not affected by what the Clear Choice rules do.

The goal of Clear Choice is to make shopping for a plan clearer, simpler and more universal. So, significantly reducing the number of plan options for a handful of consistent plan designs on its face may, in fact, make choices by an employer and their employee more efficient and simpler. But there’s a big difference between offering a basic number of standardized plans and turning that platform into a box that forces small employers and their workers to give up what they currently have and choose a new plan that is less tailored to a particular small business.

During stakeholder meetings last fall and a recent public hearing on the rules, stakeholders, including other business representatives, health insurance carriers and agents, expressed numerous concerns, including the potential effects of reduced benefits in many small-employer policies, increased costs and limited consumer choice. The Maine State Chamber and NFIB have urged both the legislature and Bureau of Insurance to slow down the process of developing Clear Choice Plans until important questions discussed here can be answered clearly and convincingly to the small-business community. We have concerns that the speed at which this process is being driven does not allow consideration of the unintended consequences on our small-business members, especially when combined with the proposal to merge the individual and small-group markets at the same time.

How these two major changes – merged markets and Clear Choice Plans – interact and affect small businesses, their employees and individuals is a great unknown. We hope that L.D. 352 and L.D. 443 or action by the Superintendent of Insurance will give all of us breathing room for more in-depth consideration of these matters before going forward in a way no state has gone.

We all want affordable health care coverage, and we recognize the intent behind Clear Choice is to make shopping easier for our small businesses. But after all the turmoil these businesses have been through over the past year, and the challenges they will continue to face as they fight to recover from the economic fallout of the pandemic, we know that upheaval in the health insurance market is ill-timed and warrants further consideration by legislators and regulators.


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