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Small business group challenges health care law, but favors exchange

Phil Castle

The Business Times

While the National Federation of Independent Business challenges the constitutionality of federal health care legislation, the small business advocacy group also supports the development of a health benefits exchange in Colorado.

Tony Gagliardi, state director of the NFIB in Colorado, said the exchange could offer lower insurance premiums to small businesses and their employees even if the federal regulation creating the exchanges is overturned. “We might stick with the exchange if it works for us.”

The NFIB is the only business organization to join in a lawsuit challenging the constitutionality of the Patient Protection and Affordable Care Act. Colorado is among 26 states also involved in the lawsuit.

In August, the 11th Circuit Court of Appeals in Atlanta ruled that a provision of the law mandating that individuals purchase health insurance by 2014 or face financial penalties was unconstitutional.

The so-called individual mandate was imposed as part of efforts to lower health care costs and require insurance companies to cover individuals with pre-existing conditions. But Gagliardi said the individual mandate would set a dangerous precedent in permitting Congress to dictate that citizens purchase a private product.

Gagliardi expects the U.S. Supreme Court to ultimately rule on the issue. The NFIB has pressed to bring the case before the court during its upcoming session and issue a ruling before the presidential election in 2012, he said.

Meanwhile, the NFIB supports the continued development of a health benefits exchange in Colorado.

Established under federal health care reform legislation as well as state legislation enacted earlier this year, the exchange will serve as a health insurance marketplace for small businesses and individuals.

Given a choice between the state or federal government developing the exchange, Gagliardi said the NFIB preferred a state-directed approach.

Colorado is among 10 states that have enacted legislation creating health benefit exchanges.

In Colorado, a nine-member board appointed to oversee the exchange includes Steve ErkenBrack, president and chief executive officer of Rocky Mountain Health Plans based in Grand Junction. Gagliardi said he supports the membership of the exchange board and expects ErkenBrack to represent rural interests.

Gagliardi said the NFIB supports the exchange if its developed properly because the exchange offers the potential to bring more health insurance carriers back to the market, in turn creating competition that could lower premiums, he added. Employers could purchase better coverage at lower costs in the small group market or employees could fare better in buying insurance in individual markets.

“This is a work in progress,” Gagliardi said of the exchange. “But it’s brand new territory for all of us.”

 

Phil Castle is editor of the Grand Valley Business Times, a twice-monthly business journal published in Grand Junction. Castle brings to his duties nearly 30 years of experience in editorial management positions with Western Colorado newspapers. In addition, his free-lance work has appeared in a variety of publications, including the Washington Post. He holds a bachelor's degree in technical journalism from Colorado State University.
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