NFIB Nails Small Group Health Reform Priorities In Short Words And Simple Sentences

The National Federation Of Independent Business (NFIB) is the nation's largest small business advocacy organization, with over 600,000 member companies throughout the U.S.

The organization's politics has usually run toward the conservative side. NFIB was one of the organizations often prominently mentioned when talking about the failure of the Clinton Administration's health reform plan.

But this year, NFIB deserves recognition for the clearest and most actionable small group market reform agenda out there in the political process. And the organization has taken to the Net to spread its gospel.

Here's a link to their cover page:http://nfib.matrixgroup.net/tabid/565/Default.aspx?cmsid=49240&v=1 (If the link doesn't work, please copy and paste in to your browser)

NFIB is selling their agenda under three important principles. They're the 3 C's: Cost, Choice and Competition. Here's a summary:

"Cost...We must bring down the cost of health insurance for small businesses and their employees. Currently, they pay 18% more for health care than big businesses. Creating an equal playing field starts with improving the small group insurance markets.

"Choice...Small business owners and employees need more choice when shopping for insurance plans. Health care reform needs to expand the number of providers and affordable plans available to small businesses and their employees.

"Competition...Lack of competition makes it easy for providers and insurers to raise their prices. In many states, small business owners have only one or two choices of insurance providers. A recent study shows that in most states the five largest insurers control 90 percent of the market. We need more competition in the marketplace and access to larger purchasing pools to help lower the cost of insurance for small businesses."

This is a reform agenda to salute. It's concise, well-documented, and recommends action steps which, if enacted, would actually help small businesses control their health care costs. Contrast it to the fuzzy, murky rhetoric coming from other national groups, like the US Chamber of Commerce, The National Small Business Association, and even my COSE alma mater.

But NFIB is in for a fight.

For several years, NFIB has been thinking about the evolution of health insurance toward a national market. They're making a big bet that with their 600,000 member companies, they would be an early favorite to meet the criteria to form a non-profit health insurance exchange or co-operative that could cast a big shadow in the marketplace, and easily move their membership past the one million mark. The organization has developed a health plan for small employers administered by a big broker specializing in association health plans.

The principal impediments: Big local or regional health plan, like Blue Cross Blue Shield plans, who are already the largest insurers of small groups at the local level; and local or statewide Chambers of Commerce and other associations which have used exclusive relationships with these insurers to build their memberships and generate a ton of revenue from sales commissions and other fees.

These groups fear the emergence of national competitors, especially big ones which could negotiate very favorable rates with insurers and providers.

That's why you'll hear them say that, if such co-ops are to be formed, they should be subject to the same rules as insurers, including rules that protect insurers from having to negotiate with associations as big customers on behalf of their members. In effect, they'll demand that any national co-op should be required to be as inefficient as they are.

And that's why I'm cheering for NFIB to win.