by Kim Chen Wiseman, Charleston Regional Business Journal
September 20, 2004
Thirteen percent of South Carolinians-more than half a million people-currently do not have health insurance. Most work or are dependent on someone who works. With double-digit percentage increases in health insurance premiums every year, more and more small business employers are passing growing premiums to employees or eliminating employer health care plans altogether. Low- to mid-wage earners are affected the most, often left without coverage for themselves and their families.
Frank Knapp, president of the South Carolina Small Business Chamber of Commerce, says addressing the crisis in small group health insurance is a top priority. According to Knapp, 65% of South Carolina employers with 50 or fewer workers do not offer group health insurance. That translates to about 60,000 small businesses in the state that cannot afford to offer health insurance to their employees.
The Lowcountry has even more uninsured workers compared to other parts of the state, not a surprising statistic since the construction, retail, hospitality and professional industries have the highest number of employers that do not offer health insurance. For many workers whose employers do offer health insurance plans, employee premiums are so high that low-wage earners simply cannot afford it.
The health care crisis facing the working poor, which has until recently been far removed from the state’s legislative attention, will likely soon be a subject of political debate in South Carolina. The General Assembly put a foot forward on the issue last legislative session when it passed a budget proviso to create a new Commission on Health Care Access. The five-member commission, which is expected to be appointed by Governor Sanford, Rep. Bobby Harrell (R-Charleston), and Sen. Hugh Leatherman (R-Florence), will be charged with pursuing recommendations of the Health Insurance Policy Advisory Committee.
HIPAC, led by the South Carolina Department of Insurance, has worked with the industry, business and medical communities to study the problem of the working uninsured in South Carolina. The committee, whose final report will be released later this month, will propose to:
– Establish a Medicaid Expansion Program for low-wage earners without health insurance. This program would provide a statewide employer coverage option, with Medicaid subsidizing the premium for individuals and families that fall below 150% of the federal poverty level. Experts believe this program would help South Carolina to draw down more available federal Medicaid dollars to subsidize health care costs for low-income workers. Qualifying workers would receive the Medicaid subsidies through their employer plans, eliminating the stigma often associated with Medicaid.
– Create legislation that would allow nonprofit community-based health care programs to raise funds through prepayment fees. Currently, state law only allows commercial insurance carriers to collect advance fees for medical expenses. Under this legislation, local programs would have flexibility to design the plan, fees, and networks based on local resources and needs. Experts believe this legislation would help to keep the uninsured population under control and stop cost-shifting to the insured. Health insurance premiums would decrease and more people would be able to afford it.
– Seek funding for educational programs that would teach South Carolinians how to be more informed health care consumers. In line with this effort, the S.C. Department of Insurance launched a web site this month-www.coveringtheuninsuredsc.org-which will soon have the capability to list medical care options based on type of need, location, and ability to travel.
Knapp, who served on HIPAC, hopes the issue will finally make its way onto the state’s legislative agenda. This isn’t the first time Knapp has been involved in pushing for reform. Two years ago the Small Business Chamber had pushed for legislation that would have created a vehicle for small businesses to come together to either self-insure or to form a health insurance purchasing pool. That proposal would have empowered small businesses to come together and better command lower and more stable premiums.
That legislation failed to advance, partly, Knapp believes, because there were competing interests at play. But Knapp believes the main reason there hasn’t been legislative action until now is because the problem of the working uninsured is such a large-scale, complex one with no simple solutions.