Two Massachusetts’ professional organizations have begun talking with the state’s commercial insurance plans about ways to provide lower-cost insurance options.
State law allows small businesses to form group purchasing cooperatives. This allows them to band together to buy health insurance. The state Division of Insurance has already certified two organizations as the first cooperatives.
The Retailers Association of Massachusetts and the Massachusetts Association of Chamber of Commerce Executives can now being talking with the state’s commercial health plans about new lower-cost insurance products that they hope will attract tens of thousands of members to their cooperatives.
Insurance regulators are reviewing applications from other would-be cooperatives, and may approve several more in the next three months.
According to an article in the Boston Globe, small business advocates had been pushing a group purchasing initiative for much of the past decade, arguing that employers with fewer than 50 workers are disadvantaged in a health insurance market that favors big businesses with more buying clout. Larger enterprises often pay less because they are self-insured, meaning they manage the risk of their employee pools themselves and rely on insurance carriers to process claims. Read More