Health Insurance Small Business Florida Alliance

trade non-profit health insurance - the type proposed as an alternative to the public option Congressional health care plan - was found in Florida in the 1990s with disastrous results

Some experts believe should be brought out, but others see inherent problems mean that any version is likely to fail.

Groups Florida - called Community Health purchasing alliances - started in 1993 to allow small businesses and uninsured individuals to band together to purchase insurance. They died in 1999, because insurers have such suffering significant losses they were unwilling to provide coverage to CHPAs (pronounced CHIF-AHS).

As legislation to reform health care is gaining ground in Congress, the trade potential is sparking intense debate.

Randy Kammer, a part of Blue Cross Blue Shield of Florida, said "absolutely" that the trade improvement can be made to work as part of a health care reform under discussion in Washington. "There are many good lessons to be learned from the CHPAs," she said.

John Sinibaldi, the president of an insurance company in Seminole, which has sold a large number of policies CHPA in 1990, disagrees. "Even when properly administered and constructed, they will find it difficult to maintain viability."

Sinibaldi believes that the current proposal for the exchange is "huge smoke and mirrors. People give this, because they are opposed to a government insurance program. But I do not think he can be effective or relevant, frankly. "

The concept behind the trade in health is that individuals and small companies together could get better rates from insurers than they could obtain separately. Depending on how they are structured, they are sometimes called cooperatives, sometimes "insurance contracts", but whatever the name, they involve the formation of groups to get better deals.

However, in Florida and other states where they have been tried, intense lobbying by the insurance industry has given rise to serious limitations on trade.

In Florida, the legislature has established 11 district CHPAs, dilution of the pool and adding administrative costs. In addition, they were not allowed to negotiate rates with insurers. "So they did not have the purchasing power of the group," said Linda Quick, president of the South Florida Hospital and Health Association.

In April 1996, 74,000 people were covered by the CHPA-sponsored health insurance, according to a report by the Office of the Legislative Assembly of Program Policy Analysis and Government Accountability. About 38,000 of them had been assured - but it was only 1.5 percent of insured state at the time.

The report also noted an oddity: Nearly 80 percent of small businesses for the signature of the APHC has only one or two employees.

Sinibaldi has an explanation: the high-risk pool of the state - a group for the seriously ill people who could not get insurance at work or through the individual market - was closed to new patients in 1989.

"CHPA became a de facto high-risk pool," says Sinibaldi. The people comprising one or two person companies just to get a APHC. A difference in Florida and most states, groups at high risk are subsidized by the government because patients are so expensive to treat. CHPAs received no subsidy.

The end result: CHPAs attracted elderly and sick. Small businesses with young people, healthier employees discovered they could get much better rates by dealing directly with insurers and avoid alliances APHC.

In the late 1990s, spending by insurers handling CHPAs had skyrocketed. Sinibaldi said insurers paid in claims for $ 3 each $ 1 in premiums collected.

Whatever the context, policymakers in Washington are trying to find h. viable