Insurance surcharges onerous

By D. SCOTT LIEBERT
In My Opinion

June 06, 2009 05:15 am

— Earlier this year, the New York State Legislature enacted the budget agreement after backroom negotiations among our state leaders. Even earlier, Albany took action to plug a deficit in last year's budget stemming from the meltdown in the nation's economy. Little, if any, detail was made available on the impact of these moves on the state's health insurance-buying public and the employers for which they work. While the media focused its attention on sensational possibilities such as a tax on non-diet soda, changes amounting to a $700 million assessment of the state's health insurance carriers were enacted with no fanfare or concern.

In the insurance industry, companies now are receiving surcharge and assessment increases as a result of these budget actions. There can be no doubt that this levy will be passed on to policyholders.

As the president of a trade association representing some 1,500 independent insurance agencies throughout the state, I am compelled to express my indignation at the enactment of the assessment. At a time when health-care costs and health-insurance premiums already are escalating at light speed, how can any lawmaker think it's prudent to load further costs to the system?

Despite its clandestine roots, some of the effects of the budget-deficit-reduction package developed by New York's governor, Assembly speaker, and Senate majority leader on our state businesses and workforce are now becoming apparent. Business owners now are learning that their own budgets for their health-insurance premiums, set at the beginning of the year, can now be thrown out the window. Each health carrier is handling the assessment/tax in different ways, but one thing is clear: they will pass the cost onto their policyholders.

This increase in premiums will make health insurance unaffordable for many employers and families throughout our state. The agencies we represent and the thousands of employees who work for them, are strapped even further to cover the cost of spiraling state government. We can't afford it! Nor do we want to be in the unenviable position of explaining these impending and seemingly unending premium increases to our customers or our employees.

I implore our lawmakers to consider the impact of such "hidden sick taxes" and to identify ways to eliminate this assessment and to avoid enacting any similar assessments in the future. You are hurting the people whom they are supposed to serve!

New York's businesses and individuals already struggle to afford health insurance. The level of taxes in this budget makes a bad situation worse and will result in many people losing the coverage they have.

As long as New York state's budget discussions continue behind closed doors, any plans to solve the state's deficit will come at the expense of our local businesses and taxpayers.

D. Scoff Liebert, CIC, is president of the Professional Insurance Agents of New York State, Inc.