A Chance for Health Care Coverage
By Elaine Chao | September 1, 2003
As Americans observe Labor Day, it is appropriate to remember the many strides that have been made on behalf of America’s workers. Our nation has made tremendous gains in creating safe, healthy and fair workplaces. Injuries and illnesses on the job have fallen to all-time lows, and we are setting records in enforcing our worker protection laws. While the economy has come through a tough period, we are seeing strong signs that the recovery is accelerating.
There are, of course, still challenges to overcome. Chief among those is ensuring that everyone who wants to work can find a job. The administration is working hard to connect job-seekers with the training they need to find employment in growth sectors of the economy—such as health care, the skilled trades and financial services to name a few. We are also developing specific policies to help our manufacturing sector. As President Bush has said many times, we will not be satisfied with the economic recovery until every American who wants a job can find a job.
But as we look at ways to help more Americans find jobs, we must also address the need for working Americans to find affordable health care. Workers and employers alike tell me that the lack of affordable health care is one of the most significant employment-related challenges today. Millions of Americans lack health insurance.
Although most people get their health insurance through their employer, 85 percent of the uninsured are in working families. A large part of the problem is that small businesses often cannot afford the cost of covering their employees. In fact, 60 percent of Americans who lack insurance live in a family headed by someone working in a small business. While 98 percent of larger firms employing more than 100 workers offer health insurance coverage to their employees, only 49 percent of small businesses can afford to offer health insurance to their employees.
That’s why I’ve been traveling around the country talking about Association Health Plans. This new concept offers a way to provide those who work for small employers with the security of affordable, good-quality health care. AHPs would remove barriers that now prevent small businesses from pooling their resources and obtaining better health insurance rates.
With AHPS, small businesses could purchase coverage for their workers through groups like the National Federation of Independent Business, the National Restaurant Association and other bona fide trade associations. By leveling the playing field and allowing small businesses to join together and negotiate the same discounted rates enjoyed by larger firms and unions, it is estimated that AHPs could lower health costs by as much as 25 percent.
The Bush administration and congressional allies have built a number of safeguards into the proposal for AHPs.
First, workers in a small business that join an AHP could not be excluded because of their health status.
Second, all participating employers would enjoy access to all options available under an AHP.
Third, AHPs would have to comply with the requirements of the Health Insurance Portability and Accountability Act of 1996 that guarantee portability of coverage between jobs and protections to cover pre-existing conditions.
Finally, AHPs would be subject to strong solvency requirements that would ensure that they maintain adequate funds to pay claims.
A study by CONSAD Research predicted that up to 8.5 million uninsured workers could gain coverage from AHPs. Seventy-five percent of small businesses say that they would be likely to participate. The bottom line is a win-win for everyone as more working Americans and their families could afford the quality health care they deserve.
So what are we waiting for? In June, a bipartisan majority of the House of Representatives passed legislation to establish AHPs. President Bush is ready and willing to sign this legislation. All that is needed is the approval of the U.S. Senate, which must make AHPs a top priority when it reconvenes in this month.
Combined with the administration’s other health care initiatives, such as prescription drug benefits for Medicare beneficiaries and medical malpractice reform, AHPs will provide expanded access and choice in affordable health care for workers and their families. On this Labor Day, we should seize the opportunity to make the promise of Association Health Plans a reality for America’s workers and their families.