House Backs New Insurance Plan

The insurance bill now passed by both the House and Senate differs from current law in a few significant ways.

Under SB 110, insurers could raise rates on small business depending on the health of anyone covered under the plan.

Insurers could also raise premiums depending on the geographic location of a business.

The new insurance bill, known as SB125, eliminates both provisions.

Representative Stephen DeStephano says SB125 is a more equitable way to insure people.

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3:41 when you have people who through no fault of their own, have some illness and now that their insurance has gone from $300 to $2000 dollars a month, that's not fair.

SB125 also establishes a so-called reinsurance pool, that helps cover the highest cost individuals.

The reinsurance pool is one of the provisions that Representative Shelia Francouer doesn't like about the new insurance bill.

Francouer says businesses will be charged anywhere from 58 cents to two dollars per individual, per month to cover the costs of those in the pool.

But what Francouer really doesn't like about SB125 is what she believes its says to the insurance industry.

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:27 ...It's sends a message to insurance companies that are thinking about coming to the state, hey, they keep changing the rules there, we don't know what the game is. We need a level playing field. And I don't think 125 sends any kind of encouragement.

For critics like Francouer, SB125 is déjà vu all over again.

SB110 was supposed to lure carriers into the state.

And now, with the passage of SB125 many opponents have said the state will be in the same pre-SB110 predicament with no insurance market competition.

Representative John Hunt, who also opposed SB125, says another flashback will be the annual rate increases businesses saw before SB110 took affect.

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:28 what this bill does is return us back to the days before SB110... we won't competition, there won't be enough insurance companies offering variable products...with escalating premiums year in and year out. And people won't have the ability to shop around or hold down their costs.

Politics played a large role behind the scenes of SB125.

Democratic Governor John Lynch campaigned fiercely against SB110 on the stump.

And now he has persuaded a GOP-controlled House and Senate to pass his small business insurance plan.

The Governor says the vote this is more than a political victory.

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:12 I think it's a win for the people of NH. The insurance market should not be allowed to discriminate based on health. That's what we've taken away here... I think what this does is stabilize rates for businesses.

If insurance rates do stabilize as Governor Lynch suggests, he'll enjoy a huge political win.

But even backers of the bill say there's no proof SB125 will reduce premium hikes, or even slow the rate of increase.

For NHPR News, I'm DG.