Connecticut Governor Considers Expanding State Health Insurance Pool

Connecticut Governor Considers Expanding State Health Insurance Pool in Politics and Legislation

The Connecticut state Senate recently passed a bill to expand the state’s employee health insurance pool in a vote of 22 to 12, reported the Harford Courant.

Under the measure, small businesses, municipalities, and non-profit organizations would be able to purchase health coverage within the pool.

Advocates of the bill are urging Governor Mary Jodi Rell to sign the bill, arguing that it would help insure more residents and bring down the cost of health insurance.

"“I just think it is a great opportunity for the state. I hope she realizes it and supports it,” said state House Majority Leader Chris Donovan.

The idea behind health insurance pools is to create “economies of scale” to bring down costs. In other words, a large group of people have more purchasing power and negotiation power with insurance companies than an individual.

Here’s a great document, courtesy of the California HealthCare Foundation, explaining how insurance pools work.

Already, the Connecticut pool insures around 200,000 state employees, wrote the Courant. Supporters say adding more people into the pool can not only help drive down costs further, but they can also help pass lower rates to people without affordable health insurance coverage.

The bill’s eventual administrative costs were also factored in by lawmakers. Leaders in the state House and Senate have indicated they’d be willing to dip into their caucus fund to pay for the estimated $500,000 in admin expenses.

But not everyone agrees expanding the pool is a good idea. Critics argue that the bill would up the rates previously negotiated with the pools three insurance companies, Aetna, Health Net, and UnitedHealth.

All three insurers have said they would have to re-negotiate if the bill was passed.

Still, proponents of the measure maintain the pool’s expansion will save the state and residents millions of dollars.

“This [bill] is really our only chance in this year of belt-tightening to provide some financial relief to cities and towns,” added state Rep. Donovan.

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