Health Care & Prescription Drugs News

Consumer Group Report Shows Small Businesses Struggling With Rising Health Care Costs

HARTFORD, Oct. 8, 2009—Connecticut small business owners are being crushed by rising health care costs according to a new report released by Connecticut Public Interest Research Group today.

“Inefficiencies and waste in health care are driving up the costs of coverage for small businesses throughout the state,” said Connecticut Public Interest Research Group’s Health care advocate, Kevin Maggio.  “Our report gathers stories from small business owners across the state, and the problems are always the same: unaffordable policies, insurance company abuses, and an inefficient system drowning in red tape.”

The new report, Small Businesses at Risk, makes clear that small business owners, like Cindy Wood, of Hartford’s Woody’s Hot Dogs, need health care reform.

“Health care right now is such a problem that if I tried to run my business they way they run theirs, I’d lose all of my customers,” Cindy Wood said.

In an event releasing the report, Cindy Wood used her own business to demonstrate leading health care problems:

·        Insurers can decide they won't cover some customers for pre-existing conditions.  If  Cindy Wood tried that in her business, she wouldn’t sell a hot dog to customers who had eaten a vegetarian hot dog

·        While big businesses can get a good price for coverage, small businesses and individuals pay 18% or more for the exact same policy.  In Cindy Wood’s business, that would be like selling one whole hot dog to people who worked for large firms, but only selling a hot dog without a bun or a bun to those who work for small businesses or are unemployed.

·        In the health care system, doctors get paid according to how much treatment they provide, not quality or outcomes.  Meanwhile, insurers drive up costs with red tape and inefficiency.  If Cindy Wood did that, her customers would be paying for every condiment for the hot dogs they buy, regardless of whether they make it any better.

·        In the health care system, premiums have doubled over the last ten years, and they're set to double again over the next eight.  If Woody’s prices had been going up like health care costs over the last decade, a simple hot dog would cost eleven dollars today.  And customers would be shelling out twenty two dollars by 2016.

“In any other business, consumers wouldn’t tolerate these sky-high prices, rampant inefficiencies, and customer abuses without walking out,” concluded ConnPIRG.  “But lack of competition and skewed incentives have turned our health care system into a nightmare.  It’s time for Congress to pass strong reforms, including a public health insurance option, to lower costs and rein in these insurers.”

- # # # # -

ConnPIRG, is a non-profit, non-partisan public interest advocacy organization. For more information visit http://www.connpirg.org