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Hartford - The base rates for small group insurance plans offered under Connecticut's new insurance exchange have been approved, but many small businesses are expected to wait before deciding whether to sign up their employees.
Both insurance brokers and small business advocates said it's still unclear whether businesses with two to 50 employees will get a better deal through the exchange, an insurance marketplace that's a hallmark of the federal Affordable Care Act.
"When full rates come out in early October, that's when I expect us to do even some preliminary looking and comparing to what they have, so that I can get the exact rates for the ages and everything for our clients," said Stephen J. Repka II, an insurance broker and president of Advanced Benefit Strategies Inc. in Unionville. Repka said some of his clients may instead decide to choose one of the new competing plans that are expected to be offered outside the marketplace.
Last Friday, the state's Insurance Department released the base rates it has approved for small group and individual plans. Three insurers - United Healthcare, Anthem and nonprofit HealthyCT Inc. - are offering three tiers of plans for small groups through the exchange. Open enrollment begins Oct. 1.
For the lowest cost plans, monthly base rates range from $271.91 from United Healthcare Insurance Co. to $298.05 from HealthyCT. The lowest priced plan from Anthem Health Plans Inc. had a base rate of $277.95. The actual premium that a small group would pay would vary due to employees' ages, the business's location and the specific plan that's chosen. It may be a challenge for small employers to compare their existing plans with these new offerings, however, because the rating methodology is different.
Phil Boyle, the business-to-business outreach manager for the health insurance exchange, also known as Access Health CT, estimates about 20,000 to 40,000 additional people ultimately will be covered by small group plans offered by insurers in the exchange. Even though small businesses are not required by the federal law to provide insurance, Boyle predicted these plans will be attractive to smaller businesses that don't always offer insurance coverage.
But recent membership surveys conducted by both the Connecticut Business and Industry Association and the National Federation of Independent Business show there is some skepticism among small business owners about whether it makes financial sense for them to get involved with the insurance exchange, which is scheduled to be officially up and running Jan. 1. Both groups found that their members are worried about increased costs.
Andrew Markowski, the Connecticut director of the National Federation of Independent Business, said that at first glance the rates appear to be pretty similar to rates being offered now to small groups.
"The competition is underwhelming," he said, adding how employers will have to make decisions based on the quality of the plans, the adequacy of the health care provider networks and the amount of cost-sharing they and their employees will incur.
"It's really just the beginning, because more information is necessary," he said.