NFIB: House "ignores" concerns of small business

NFIB: House “ignores” concerns of small business

For Immediate Release
Contact: Shawn Shouldice, 802-498-0059

House of Representatives Ignore Concerns of Small Business
Limited Choice and No Answers about Cost

Montpelier (February 24, 2012) – Legislation passed today by the Vermont House of Representatives to establish Vermont’s Health Care Exchange does not create the “robust marketplace” promised by the federal reform and expressly prohibits an option for individuals and small businesses. The bill heading to the Senate will herd individuals and small businesses toward a limited choice of plans that will cost more, said the National Federation of Independent Business (NFIB) today.

“Although we thank the 57 supporters of Rep. Mark Higley’s amendment; failure by members of the Vermont House of Representatives to amend the bill was a missed opportunity to send small businesses in Vermont, who account for more than 95% of all businesses, a message that they are as important as big businesses, said Shawn Shouldice, who serves as the State Director of National Federation of Independent Business – Vermont (NFIB/VT).

“NFIB/VT believes relegating employers with 50 employees or fewer into the Vermont Exchange will collapse the remaining private market in Vermont and leave businesses with no lifeline should this new system fail,” continued Shouldice.

Additionally, supporters claim they will draw down federal funds to help subsidies the premiums, however, you don’t have to look far to see federal dollars across the board are drying up. The bill does not address the costs or how the new system will be funded. There are no provisions in the bill for what insurance premiums will be or how it will be funded. NFIB/VT agrees that the Vermont health care system should be addressed but this the wrong approach.

Shouldice observed that there was much speculation, no definitive answers, and a distinct lack of understanding about the consequences of the passage of H.559 during the House floor debate. Furthermore, no other state is taking such dramatic steps in their health care reform efforts.


National Federation of Independent Business (NFIB/VT) is the voice of small business with more than 1,800 members across Vermont. For more information about NFIB, please visit

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  • Bob Zeliff

    Ms Shouldice chooses to use out of state info from the NFIB that some where in the US, the exchanges will cost more. She does this when she and the rest of Vermonter have better information , specific to Vermont, that clearly indicates it will lower cost overall and especially for small group and individuals. See Act 48 Integration Report, p38 Table 1.

    We must remember that the Exchange was added to the Affordable Care Act as a compromise to the Insurance Industry, to allow them to compete in a fair and open market place. The Affordable Care Act evan provides subsidies so more business and people can buy this private insurance. These subsidies will all end up in the pockets of the Insurance companies. That is why the Insurance Industry lobbied so hard for it.

    The Exchange is a step we must comply with by law as we Vermonters move toward a locally controlled, self insurance single pipeline based health care system. This will get the wasteful, inefficient and expensive insurance middlemen out of the costs.

  • Jed Guertin

    Here we go again! The NFIB National, NFIB/VT and Shawn Shouldice are gearing up for the 2012 elections in concert with NFIB National just like 2010. Watch every State NFIB organization tweak State issues to try and meet the NFIBNational/Republican mantra.

    Did I say Republican mantra, well in 2010, 95% Of NFIB’s political donations went to Republican candidates. But NFIB swears there is no bias in their campaign funding.

    In 2010 I wrote an opinion piece on the NFIB. I still stand by the facts I presented then. If you want to know a little about the NFIB, things that they’re not likely to tell you look at:

  • Mr. Zeliff: There is Vermont-evidence of the rate shock Ms. Shouldice describes, and it’s in the very chart to which you refer (Table 1, p. 38). Table 1 reports that rates for small businesses (<50) purchasing their insurance thru Associations (such as Vermont Business for Social Responsibility, the VT Grocers, BRS, etc) would see an 18.4% increase in their rates due to the H. 599 proposal to combine all individuals and all small groups into a single pool. The small groups purchasing directly from carriers would see a slight decrease, as you note. However, those buying from Associations would see an 18.4% increase. When this was pointed out during debates in the House, the figure was not challenged by the Administration — How could it be? It's from their own study.

    To see how significant this impact would be, I refer you to page 25 of the report where it is stated that of the 103,590 Vermonters currently covered in the small group market, 79,902 or 77% of them are covered by the Association plans that would see the 18.4% increase. 23% of small businesses would get the slight decrease you mention.

    I'll repeat that for effect: 77% of the people currently insured through the small group market are projected to have an 18.4% rate increase.

    Given this anticipated rate shock, it's no wonder that small businesses are extremely uncomfortable with a bill that defines only one place to buy health insurance, where their only plan "choices" will be defined and circumscribed by political bodies.

    • Bob Zeliff

      There you go again…telling half the story again.

      Those in associations with good demographics/low risk have benefited lower rates. Those associations with more risk do not enjoy the same low rates. Not all in associations will see the 18% rate increase as you suggest.

      The Vermont implementation of the Exchange will include a broad community rating to more evenly spread the risks.
      This will result in a small group rate decrease of 8.4%. not so slight!

      But more importantly, a point you omit totally, individuals will see their rates go down substantially, 12.4%. There are 110,000 individuals, this is a much larger number than those in association.

      So the net result is a significant majority of Vermonters will see their rates go down. I would call this a good result.

      We in Vermont want to get our health care reform right. Getting all the facts on the table fairly is the only way an informed Democracy works. Those who parse the facts do not serve Vermonter’s best interests.

      • Craig Powers

        Sure seems to me that the individuals will be benefiting at the expense of small businesses in the Association plans. Cost shift, you bet! …but again it’s not your money…so why do you care?

        • Bob Zeliff

          I would call it a cost leveling. Those in high risk businesses, example, farming logging would see their rates go down. Others in low risk jobs would go up.
          This is the definition of broad community rating…ie all Vermonters not just cherry picking the low risk groups.

          Seems fair to me.

          Remember as I said, the Affordable Care Act will also provide grants,etc to help low and moderate income people to afford care or better care than the can now.
          This will allow people who did not have insurance before to get it or get better insurance.

          When the Insurance Industry lobbied to have the exchanges include in the Affordable Care Act, they promised these transparent open markets would increase competition and lower rates for all. I can’t wait for them to deliver on their promise and provide additional savings….not just what the government kicks in and the more people they get to insure.

  • The House passed a good bill yesterday – but we started the session with a great bill.

    The current employer-sponsored insurance system is going away. The double-digit increases every year are unsustainable; business leaders and workers are paying more and more for less and less. The system is a burden on our business community, restraining job and wage growth.

    Vermont’s plans to cover all residents with a basic health benefit package and to decouple insurance from employment will finally give the business community the freedom to succeed.

  • walter carpenter

    “Cost shift, you bet! …but again it’s not your money…”

    As if we do not have a gigantic cost shift now under the current non-system. It is called

    “to allow them to compete in a fair and open market place.”

    Bob, thanks much for your posts. I always enjoy reading them. I wonder, though, if what the insurance companies want is to complete in a fair and open market. They seem to want more monopolies than competition. The exchanges were just a way to get around real reform. Still, vermont has wanted to do its best by them, which the house health committee has done, and as you said, “want to get our health care reform right.”

    “Vermont’s plans to cover all residents with a basic health benefit package and to decouple insurance from employment will finally give the business community the freedom to succeed.”

    Dan, let’s hope so.

  • Dave Bellini


    Cutting out “middlemen” and reducing administrative waste.

    Bringing healthcare to people that can’t afford to receive treatment.

    Changing the delivery of care from the current fee for service model.

    Possible elimination of some duplicative services.

    THE BAD:

    Telling citizens important plan details AFTER the election. If it was all good news we’d have already been informed.

    Might cost middle class Vermonters currently with insurance more money to have less of a benefit.

    Reliance on federal money is like making plans based on only good weather and sunshine.


    The cost or the most important details of the new system.

    If state government will be able, or in the future willing, to run a health plan that is and remains affordable without slashing benefits.

    What happens if a future Governor hates the system and tears it down? Where does that leave folks?

    What protections will people have in the next big recession and the budget has to get cut guess where?

  • Kathy Callaghan

    Kudos to Jeannie Keller for getting it right, as usual, and bringing the potential 18.4% rate increase to the forefront. Once again, if the Exchange plans are that comprehensive and affordable, people will flock to them on a voluntary basis. There is no justification for the State to take away Vermont businesses’ freedom of choice on how they spend their health care dollars. The Feds designed the Exchange to provide as much freedom of choice as possible; as many options as possible; a health care shopping website to compare available plans and costs, and then make one’s decision. What part of that design involves forcing small employers and individuals to buy only certain plans and only through the Exchange?

    Rep. Michael Fisher says he can’t for the life of himself understand why anyone would prefer freedom of choice, when the Feds are offering such great premium supplements. The answer is obviously, that no one of any intelligence believes that the Feds will continue offering these great subsidies at their current levels, with no decreases, for the next 15 or 20 years. Even if this miracle were to occur, health care will cost a whole lot more in 2027 – 2032, so the subsidies will have to increase significantly in order to even retain the status quo. How likely is that to happen? Do you believe in the Easter Bunny?

    If the Administration does not know the answer to how many years the Federal subsidies are guaranteed, and at what levels, and how the State will make up the cost difference when they end, they are in no position to even attempt to cost this out.

    Green Mountain Care folks are now touting “getting health care off the backs of employers”. A nice catchphrase, but let’s look at what it really means. By dropping a health care plan, Employer X will save premium money but also lose the tax deduction for the cost of providing the plan. Assume that Employer X paid 75% of the premium for the company plan and Employee Y paid 25%. Employee Y will now need to purchase through the Exchange. Will Employer X gross up Employee Y’s salary sufficiently to cover the difference between his current out of pocket cost (25%), and the out-of-pocket cost of an Exchange plan? Unlikely, as that would increase payroll costs. So now Employee Y has, in effect, taken a pay cut equal to the value of the 75% of premium his employer was paying for his health plan, and he is now 100% financially responsible for purchasing a new health plan. If all goes well, Employee Y finds an Exchange plan with no loss of benefits, which doesn’t cost him more than his former 25% premium share. The odds of this happening are amorphous at best. Some of it will, of course, depend on those pesky Federal subsidies. How much will he get? How long will it last? What happens when the subsidies diminish or end, while the cost of health care keeps rising, as it certainly will? Can you see Employee Y’s health care costs going higher and higher? Can you see his benefits going lower and lower? Has Green Mountain Care factored Employee Y’s fate into their planning, or are they just rushing to get it done, no matter the long term consequences?

    A thoughtful Green Mountain Care Board and staff will resolve these as well as the many other urgent issues and questions being raised by Vermonters, and communicate the answers to the general public – sooner rather than later. To the frustration of many Vermonters, this level of scrutiny has not even begun to occur.

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