NFIB/MD Wants to Abandon State Health Exchange

Date: July 15, 2014

Annapolis (July 15, 2014) – Maryland small business owners have had enough of the state’s bumbling on health care and they want to switch to the federal exchange, said the National Federation of Independent Business (NFIB) today.


“The health care law has been a rolling disaster for small businesses in Maryland and state officials have proved that they’re not up to the job of running a system competently,” said NFIB State Director Jessica Cooper.


Maryland is one of a handful of states that opted to build and run their own health insurance exchange.  The others chose federally-facilitated marketplaces, which famously blew up on the launch pad but appears to be much more functional than the Maryland exchange.  Maryland, on the other hand, wasted more than $100 million on an exchange marketplace that failed so badly that it couldn’t be fixed.  Earlier this year state officials decided to scrap that system and spend millions more on a version used by Connecticut.  But now that system is sputtering, with reports of a new glitch that is errantly cancelling insurance policies for thousands of customers.


“You couldn’t make this up,” said Cooper.  “Obviously they don’t know what they’re doing and it’s not fair to small businesses or taxpayers to let them continue blowing money on systems that don’t work.”


Beyond the glaring technical failures, Maryland officials seem to have designed a market that discourages competition. Ninety four percent of customers who purchased insurance through the exchange appear to have been influenced toward one carrier, CareFirst, which now wants to raise premiums as much as 30 percent. And unlike many states, Maryland did not allow for a continuation of non-Affordable Care Act-compliant plans.  This decision further restricted choice for individuals and small businesses.


“Maryland designed a system that created a near monopoly despite that the program was sold as a way to increase competition,” said Cooper.  “The predictable result of a monopoly is higher prices and lower quality.”


The health care debacle should be a major issue in this year’s race for governor and both candidates should assure voters that they understand the problem, she said.


“Lt. Governor Brown and Larry Hogan could do themselves a favor and have an impact now by signaling that they’re not willing to waste any more money,” said Cooper.  “Switching to the federal website should be item number one on their respective to-do lists.”


The problem has been especially troublesome for Lt. Governor Brown, who oversaw the construction of the Maryland website.  But the mark of a good leader, said Cooper, is a willingness to admit mistakes and move forward.


“Small business owners sometimes make bad investments too but they don’t throw good money after bad,” she said.  “Both of these men owe it to the small business community and to the taxpayers to cut our losses and move quickly to a system that works.”


NFIB members overwhelmingly opposed the federal Affordable Care Act and they predicted many of the problems that now plague Maryland and other states.  As a practical matter, however, they’d much rather deal with a functional marketplace website, said Cooper. 


“That system doesn’t exist in Maryland and we can’t afford to waste more time and money trying to build one when there’s a ready alternative,” she said.  “One way or the other this is going to cost Maryland small businesses more money.  It will be more expensive to keep pouring money into the state website and our members believe it’s time to rip off the Band-Aid.”


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