FOR IMMEDIATE RELEASE                                                        Thursday, March 20, 2008

Contact: Senator Kathleen Sgambati

(603) 271-3074

SENATE SUPPORTS SMALL BUSINESS HEALTH INSURANCE PLAN

CONCORD – The Senate voted 21-3 today in support of a new health insurance program for small businesses called New Hampshire Health First. The legislation now heads to the House.

“This plan makes coverage affordable, not by diluting benefits, but by addressing the underlying drivers of health care spending,” said Senator Kathleen Sgambati (D-Tilton), who sponsored Senate Bill 540 at the urging of Governor John Lynch.

The legislation would require major insurance carriers in the state to offer a standard wellness plan for small businesses with up to 50 employees. Premium costs would be controlled by focusing on prevention, managing chronic conditions and promoting best practices. Similar legislation in Rhode Island produced a savings of more than 15 percent for small businesses compared to other forms of coverage available in the market.

“We have heard repeatedly, especially from the small business community, about the need for this kind of help,” said Senator Maggie Hassan (D-Exeter), a co-sponsor. “We are putting pressure on carriers to do cost containment and we’re asking consumers to do the same by providing incentives for them to take better care of their health.”

Senate Bill 540 calls for the state Department of Insurance to set up an advisory committee to develop the specifics of the plan. The target premium price would be 10 percent of the prior year’s median wage, currently about $262 per month.

Safeguards protect insurance companies from having to absorb a loss if the premium price is not adequate to cover their costs. The advisory committee would rework the plan if no insurance carriers can meet the target price. In addition, the legislation calls for plan requirements to be reviewed and revised every three years.

“We have an opportunity to develop a product that helps our small business owners who’ve been struggling with sharply rising insurance costs for years now. If this allows more of them to keep their employees covered, we all benefit,” said Senator David Gottesman, (D-Nashua) chairman of the Commerce Committee, which recommended passage of the bill.