Small Businesses Have a More Affordable Buy-In Option Under Enhanced Program
Taking fast advantage of opportunities under federal health care reform, the Senate Democratic Majority won provisions in the recently-passed state budget to make high-quality, low-cost health insurance coverage available to small businesses and workers all across New York.
A new expansion of Family Health Plus for small businesses and their workers will use federal subsidies and new financing innovations to provide comprehensive health coverage available at a cost of about $157 per month for employers and about $50 a paycheck for workers.
Due to a combination of declining employer health coverage and unaffordable prices in the individual market, New York’s uninsured population consists largely of working people and their dependants, compromising 80 percent of the State’s total uninsured. More than 40 percent (805,000) of uninsured workers are employed at firms with less than 25 employees.
Small businesses with less than 100 employees, do not have the bargaining power of their larger counterparts and have had the greatest difficulty in absorbing the growing costs of health care coverage. Small businesses in New York spend an average of 18 percent of their payroll on health insurance costs, and many are not able to offer it to their employees at all.
Using Medicaid rates instead of commercial rates will significantly reduce the cost to both the employer and the employee, offering an alternative pathway to health insurance coverage and decreasing the number of working New Yorkers who will be uninsured. Employers participating in the program will pay 70 percent of premiums, while covered employees pay the remaining 30 percent.
“This is a pro-small business and pro-family measure that can only help our communities,” said Sen. Toby Ann Stavisky (D-Queens). “If one of the reasons employers do not offer health insurance is the cost of doing so, the Family Health Plus Employer Buy-In makes it much more affordable for them. Workers who can afford to take care of their health live longer and are more productive, which makes them also better able to care for their families and communities. If that then frees up money that could be used to hire new workers, we could even see the benefit ripple outward through our communities in other ways.”
To qualify, all employees in the workplace must enroll into the program. Brokers are barred from selling this product. To enroll, an employer must fill out a one page application and submit it to the New York State Department of Health.
“While small businesses are the economic engine of New York, the business owners surveyed by the Community Service Society of New York told us that providing good coverage to their employees—as much as they wanted to do it—would cost them their businesses,” said Elisabeth Benjamin, Vice-President of Health Initiatives at the Community Service Society, “These fixes to the Family Health Plus Employer Buy-In Program come at a crucial time, coinciding with the federal tax small business tax credits, and mean that good, affordable health insurance is now a viable option for most small businesses and their employees.”
"Extending Family Health Plus to employees of small companies through the Employer Buy In option will result in better health coverage for more New Yorkers," said Peter Slocum, Vice President of Advocacy, American Cancer Society of NY & NJ . "By making the affordable, accessible coverage offered through Family Health Plus more readily available, plan participants will be able to prevent cancer or detect it early by getting recommended screenings, and more easily seek treatment in the event of a cancer diagnosis."
“The changes to the Family Health Plus Employer Buy-In Program mean that many of the people we represent – those with serious illnesses and disabilities – will be offered coverage that has an affordable premium and reasonable co-pays” said Heidi Siegfried of New Yorkers for Accessible Health Coverage, “This is good news for New Yorkers, both those who want to be able to offer the coverage and those who need it at reasonable rates.”
“Many small businesses in New York are owned and run by women, who have consistently said they would like to offer health insurance to their employees,” said Lois Uttley, co-founder of Raising Women’s Voices for the Health Care We Need. “This new law will provide an important opportunity for these women-owned businesses to be able to buy coverage they can afford.”
Freddy Castiblanco, Owner of Terraza 7 Train café said, “As my business has grown, I have wanted to purchase a group health insurance plan that our employees could choose to participate in for themselves and their families. I have found, however, that the costs of decent health coverage are completely unaffordable for a business like mine. I have lost some of my most talented employees to other employers because I can’t provide health insurance. I have witnessed my employees avoid necessary medical treatment because they feared facing a large hospital bill – what could have been small medical problems turned into larger crises because my employees lacked health coverage. The cost of health insurance would make health care the largest expense for my business after wages, over eighteen percent of my payroll, outweighing my rent and any other operating expenses. I really want to be able to provide insurance to my family and my employees but as the system is set now, it is completely unaffordable.”