Supporters of a plan to provide health coverage for all of Maryland's 600,000 uninsured described their proposal yesterday as one that would help small businesses, but some employers said the plan would be a burden that would lead to a loss of jobs.
The debate came at a hearing before the House Health and Government Operations Committee on whether to enact a plan by the Maryland Citizens Health Initiative. The plan would require employers to offer adequate and affordable health coverage or pay 5 percent of their payroll into a state fund.
"This is in many ways a pro-business bill," Dr. Peter L. Beilenson, Baltimore health commissioner and chairman of the health initiative group, testified. Some small employers joined him in supporting the plan requiring businesses to "pay or play."
Mark Derbyshire, vice president of Park Moving and Storage Co. Inc. of Harford County, said his company does provide coverage for its 30 workers, but "we're at a competitive disadvantage with companies that don't provide it."
Joseph W. Hopkins 3rd, president of Joseph Hopkins Associates Inc., a Baltimore company that consults on archaeology and architectural history, said, "We don't offer coverage, because no one in my field does. We'd be priced out of the market." He said he could offer health benefits to his employees if his competitors were required to.
But Ellen Valentino, state director for the National Federation of Independent Business, said, "There are segments of this plan that would be a disaster." In particular, she criticized a provision of the bill that would impose a 2 percent premium tax on HMOs (other insurers in the state already pay the premium tax). She said that would mean a tremendous additional cost for small employers who are currently offering health benefits.
Jeffrie Zellmer, who represents the Maryland Retailers Association, said, "This is a heavy burden at a time the retail industry is at its lowest."
Their objections drew a sympathetic response from some of the committee members. Del. Patrick L. McDonough, a Republican from Baltimore and Harford counties, was the most vocal.
"Everyone sitting at these desks is just as compassionate as anyone else," he said, "but this is on the back of the small business community."
And the committee chairman, John Adams Hurson, a Montgomery County Democrat, while not clearly expressing opposition to the plan, asked whether the bill might encourage start-up businesses to locate not in his district but in the District of Columbia.
Even the bill's proponents have suggested such a sweeping plan is unlikely to pass the legislature this year. Vincent DeMarco, executive director of the health initiative, said after the hearing, "We want this bill to pass right now - there are 600,000 uninsured people who need coverage. But we realize this may take time, and we want to work with the committee."
In addition to the charge on businesses that don't participate, the plan would require individuals to have coverage, expand the Medicaid program to cover more low-income adults and establish a new program to cover an estimated 180,000 working poor. The plan would be financed by the fees on non-participating employers and individuals, the 2 percent premium tax, sliding-scale premiums paid by moderate-income individuals, and money diverted from other programs to help the uninsured, which, Beilenson said, would no longer be needed.
Some critics of the bill praised the goal of extending coverage, but said the plan needed more study to avoid unintended consequences. Fran Doherty, a lobbyist for CareFirst BlueCross BlueShield, said her company would work with lawmakers over the next year to try to find alternative ways of extending coverage.
Elizabeth Sammis, director for government health services for Mid Atlantic Medical Services Inc., a Rockville insurer, said the plan would raise the price of coverage for small employers and "further destabilize the small-group market" by making more people eligible under the state's program for small employers.
Supporting the bill, in addition to several small employers, was a parade of witnesses from labor, religious, senior and medical groups.
Also providing testimony were several Marylanders who have grappled with being uninsured.
Joan Wilson, of Takoma Park, said she was uninsured in 1996, when she was diagnosed with breast cancer. Her doctor asked if she wanted to wait a few months, when she would turn 65 and qualify for Medicare. She said she had been able to find a state program to help her immediately, but didn't want others to face a similar choice of deferring needed treatment.
Kimberly Nolan, a self-employed consultant from Baltimore, who said she had been denied an individual policy for medical reasons, said when she was treated for a broken elbow, "When you say you don't have health insurance, the look on their faces fills you with humiliation."