N.H. House repeals parts of health insurance law

CONCORD — The House voted Wednesday to repeal pieces of a controversial health insurance rating law it supported two years ago, joining the Senate in proposing major changes to rate-setting rules.



By an overwhelming vote of 256-105, the House sent a measure (HB 611) to the Senate which would undo many provisions of the small business insurance rating law known as Senate Bill 110. The law, which took effect last year, allows insurance companies to factor in age, medical history, type of business and geography when calculating rates. The House bill passed Wednesday eliminates most of those factors when insurance companies set rates for small businesses.



The Senate passed a similar measure last week.



“This will bring stability to a market that is in flux due to the chaos Senate Bill 110 has created,” said Rep. Sheila Francoeur, R-Hampton. “This is the first positive step to correcting the errors of Senate Bill 110. It moves us along to health care reform, something that is needed in this state.”



There was vocal opposition to the bill, even though the vote was lopsided. “I don’t think we’ve given this enough time,” said Rep. Michael Whalley, R-Alton, a small business owner. “I don’t think it’s the appropriate thing to slam the door here today and slam the door on something we did just a year ago.”



The bill eliminates the location of a business and health status of workers in setting insurance rates. Because geography is a factor in setting rate, the Seacoast and North Country were the two hardest hit areas as a result of SB 110. Age and type of business will remain in the rate setting.



It also sets up a reinsurance pool for high-risk policies. The insurance companies would be assessed a $1 per month, per person fee to create the funds for the risk pool.



The reinsurance pool would allow insurance companies to shift high-risk employees into the pool after the rates have been set.



Opponents claimed insurance companies will pass the $1 reinsurance pool fee to the ratepayer.



“(This bill) creates a $1 per employee per month business tax for every small business in this state. It will raise rates between 30 and 60 percent,” Rep. Rogers Johnson, R-Stratham. “(This bill) takes every onerous aspect of Senate Bill 110 and makes them worse, in fact it super-sizes them. A year from now you’re going to have to explain to your constituents as to why their rates are so high. If you want to pass this business tax, then OK.”



Gov. John Lynch said throughout his campaign he would fight to repeal SB 110. On Wednesday, Lynch praised House members for passing a major overhaul of the law regarding small businesses, defined as having 1 to 50 employees.



“By taking action to repeal the onerous provisions of SB 110, the Legislature has shown that they have heard the cries of our small businesses,” Lynch said. “I look forward to working with Democrats and Republicans in the House and Senate to make sure our small businesses get the relief they need.”