Today: Feb 25 , 2020

Affordable Small Business Healthcare - Victim of Budget Cuts?

06 January 2008  
If you could have truly affordable health insurance as a small business owner, would you get it?  That's what Healthcare Group of Arizona offers, but it's a program that may be cut due to the Arizona state budget woes.

healthcare2.jpg “Have you ever heard of Healthcare Group of Arizona?”

That question was posed to 20 people chosen randomly from around the Courthouse Square in Prescott. Of the 20 local business owners, store managers, clerks and customers, only 3 had ever heard of Arizona’s state subsidized health care plan for small businesses. If a business in Arizona has 50 or fewer employees they are eligible to join Healthcare Group of Arizona, (HCG). Rates start at $100 per month, and no one can be turned down for pre-existing conditions.

Now some Arizona State Legislators want to shut the program down. Their first step was to freeze enrollment in September 2007. Iris Napier, owner of Country Roads Antiques and Gifts on Cortez found that out the hard way. Napier is one of the 3 people who knew about the program. She found out about the freeze when she tried to enroll. She expressed her disappointment, not only for herself but for the other small business people and their employees who could benefit from the program.

“Mr. Tom” was working the ice cream parlor at Kendall’s and is very knowledgeable about HCG. He is getting ready to take an exam to become a licensed insurance agent. He says that closing down the program would affect people across the board. “Our health care is at a premium in the United States. And there are so many children and people with disabilities not covered. If the parents get a job they’re kicked off AHCCCS. The people taking this away… it’s being done by the insurance lobbyists because they’re making billions and billions from regular insurance. It’s a tragedy.”

Representative Kirk Adams (R-Mesa) makes no secret of the fact that he would like to see the program shut down. His idea is to grandfather in the companies who already have insurance through HCG, and set up a new program for people in Arizona who are uninsurable because of illness and pre-existing conditions. This new program would cost the state between $25 and $50 million per year. Adams is part of the committee formed by the legislature to study HCG. In addition to being a state legislator Adams is a small business owner.

 

healthcare4.jpg
Iris Napier is on a waiting list to receive the insurance, but she's not sure if she'll ever get it.
Representative Steve Farley D-Tucson believes HCG is a target of lobbyists from private insurance groups. He also thinks that parameters set in place by the legislature almost guarantee failure for the program. Farley thinks the state should remove the hoops people have to jump through to get the insurance. The program would then open up the pool to more people without the pre-existing conditions. He thinks the system could then become self-supporting. He is quoted in the Arizona Republic as saying Legislators “have effectively slashed the tires on the car and then declared that the car is junked and needs to be replaced versus replacing the tires.”

 

According to the Healthcare Group of Arizona’s website they currently insure approximately 30,000 people. It’s estimated that the program is $20 million in the red, which represents approximately $55.00 per month per covered member. HCG is already increasing rates and putting larger co-pays in place. In Pima County last September they increased premiums up to 15 percent and as a result lost 800 of their 10,000 members. Other counties have increased premiums as well but figures were not available.

HCG is working on cost cutting measures and reduced administrative expenses by $2.5 million for the fiscal year. Also the group is trying to get the legislators to allow them to pursue the same negotiated lower rates which the state’s other health care system, Arizona Health Care Cost Containment System, (AHCCCS) enjoys. They also believe that giving insurance brokers a commission when they renew a person’s policy with HCG would help bring in more customers.

There are three health care proposals working their way through the ballot process for November 2008. One is the "Medical Choice for Arizona" act which would guarantee Arizona residents right to continue to choose whatever private health care they want. Proponents feel is a preventative measure to preserve citizen’s rights to choose their own policies. The second proposal is titled "Healthy Arizona" and its aim is to make sure every legal resident in the state has some sort of private insurance. The third group is “Arizonans for Responsible Health Care,” (AFRHC). This group proposal would establish universal healthcare in Arizona with a program to streamline the overhead that comes from various insurance companies, replacing it with one state-wide clearing house for membership, eligibility, provider contracts, billing and payment systems, and a focus on wellness checks, preventative medicine and early detection.

In a newsletter to members last September Deputy Director of HCG Kevin Nolan sounds optimistic about the coming years and says they will continue to work towards their mission statement which is to “insure the uninsured.” The freeze on enrollment is scheduled to be lifted on August 1, 2008. In the meantime people who are interested in obtaining the insurance for themselves or their companies can email HCG at hcg@hcgaz.com or call (800) 247-2289. HCG will contact everyone who has shown interest in obtaining a policy this summer.

Want to communicate with your state representatives about this issue?

Lucy Mason, State Representative
Andy Tobin, State Representative
Tom O'Halloran, State Senator