By Liv Osby, The Greenville News
Published August 10, 2006
The high cost of health insurance puts it out of the reach of many small businesses.
And health care is so expensive that uninsured workers at those companies often can’t even afford a trip to the doctor for a minor illness.
But small business leaders and community health centers around the state have come up with a new approach they think could make at least primary care a possibility for many of South Carolina’s uninsured — at least 40,000 of whom live in Greenville County.
Under the plan, small businesses team up with community health centers, like New Horizon Family Health Services, to provide employees primary care at a discount, says Frank Knapp Jr., president of the state’s Small Business Chamber. Hospitalization and specialists aren’t included, and no insurance is involved, so the plan can’t provide care for serious illnesses such as cancer or heart problems.
The idea was borne out of the frustration of small businesses that want to offer coverage to their employees, but struggle to do so, Knapp said. A pilot project was launched in Columbia last year, in conjunction with the South Carolina Primary Health Care Association, in which the business pays the costs of doctor visits and lab work after a $10 employee co-pay, up to a maximum amount. And so far, he says, it’s working fine.
“Everything we thought would happen, happened,” Knapp said. “We had employees who did not have insurance who now had a primary care physician who they could go to affordably.”
Fred Seidenberg, president of that Columbia company, Mid-Carolina Steel and Recycling, said it’s been a great alternative for his 50-person business.
Family coverage costs about $1,500 a month per employee through his company, he said, and not everyone can afford that. But by partnering with area health centers, he’s paid a total of $1,700 (over ten months) for medical care provided (for his 25 workers enrolled in the program).
“We’re a small company and we had a couple of major claims on our insurance and our rates went so high you can’t afford to pay for everybody’s health insurance,” he said. “I’m very impressed with the level of services. And so far, we’ve gotten very positive feedback from our employees.”
Rising health-care costs and lack of insurance is an issue that community health centers can help with, according to Regina M. Cook, CEO of New Horizon.
“Health centers reduce health disparities . . . and are taking the lead in fighting costly and disabling chronic disease,” she said. “These centers save taxpayers $7 billion annually (nationwide), reducing the costs of disease by keeping people healthy and out of hospitals and costly emergency rooms.”
Under the proposal, the business partners directly with the health center, and together they hammer out a plan that is affordable and acceptable to both, Knapp said. In addition to the way the Mid-Carolina plan works, for example, the community health centers could accept a set amount every month for unlimited services, he said.
There are 19 community health centers with 134 locations across the state capable of partnering in such a plan, Knapp said. And because they are federally qualified, they can use federal funds to offset the cost of providing services to patients with incomes up to 200 percent of the poverty level, he said.
In the case of New Horizon, discounts of 20 percent to 80 percent off normal charges could be offered depending on income and family size, said spokeswoman Shannon Owen.
“This is an effective and efficient way of providing
primary health care to the uninsured in this state,” Knapp said. “We’re already talking to another company in Columbia. And three in Charleston.”
No Greenville businesses are involved yet, he said, but word is just getting out.
Ben Waldrop, co-owner of Century Printing & Packaging Inc. in Greer, says it sounds like a good idea. The company ended standard insurance after premiums increased up to 15 percent a year and went to a health savings account plan for its 15 employees, limiting increases to single-digits.
“If I can set what the limit is, instead of the insurance company telling me what I have to pay, and I know what the maximum costs will be and my employees are covered,” he said, “that’s pretty attractive.”
Nonetheless, Waldrop said he has some concerns, such as ensuring that employees buy into the idea.
“They’d have to feel comfortable with it,” he said. “They’d have to trust that medical establishment and (be assured of) their privacy. But it’s an interesting concept.”
Ken Brower, owner of TiBA Solutions, a custom computer system developer in Mauldin, says the idea sounds good for more blue-collar operations. But to attract skilled professionals to his company, he says he has to offer a “robust” benefits package that costs him $250,000 a year for 50 employees.
“It sounds like a great plan for a large portion of the population,” he said. “That’s not to say we can afford to pay these incredibly outrageous health-care costs. It’s our second-largest cost, second only to payroll. And it’s getting out of control.”
Brower said his company just switched to a new insurer after premiums were set to rise 30 percent last year on top of a 22 percent hike the year before. Companies like his, he says, still need some relief.
And Jess Papenfus, owner of North Gate Labs, a six-person Greenville software production company, agrees, adding that convincing white-collar professionals to go to a community health center could be a hard sell, no matter how qualified the staff is. High-deductible savings accounts are the way he’s going.
“For our people, I don’t think it’s a workable solution,” he said. “But for certain companies it may well be.”
Knapp says this idea isn’t an answer to the entire problem, but is a piece of the puzzle. And he says leaders are now working on a plan that would offer affordable high-deductible hospitalization coverage to employers.
“If you don’t have insurance now, this doesn’t change that,” says Knapp. “But at least they have primary care taken care of.”