SEMA Member Survey Sends Clear Message to Lawmakers on Need to Enact Association Health Plan Legislation
WASHINGTON--June 2, 2005--Skyrocketing premiums have made it difficult for specialty automotive companies to offer health care coverage to their employees. That is the unmistakable conclusion of a recent survey conducted by SEMA, the Specialty Equipment Market Association.The survey results will be shared with Congress in testimony urging passage of the "Small Business Health Fairness Act." The legislation should help reduce health care premiums for many small companies by allowing trade associations to offer Association Health Plans (AHPs). These types of health care packages are negotiated on a national rather than state-by-state basis. SEMA has made passage of the AHP legislation a key priority.
"The survey provides real-world feedback about what's happening among smaller businesses across America," explained Chris Kersting, SEMA's president and CEO. "Our companies are suffering from skyrocketing health care costs. As a result, millions of hardworking Americans and their families are joining the ranks of the uninsured."
Nearly 60% of the SEMA respondents to the survey were small companies that employ as few as 10 workers. Rising health care costs forced 20% of the respondent companies to stop providing health care coverage over the last 10 years. Currently, 31% of the companies do not provide any coverage. 28% still offer coverage and pay the entire premium. For the remaining 41%, both the workers and the company pay the premium costs. Asking the employee to share that burden was a rare occurrence 10 years ago according to the survey.
For those offering coverage, many have taken common steps to deal with high premiums, seeking the least expensive packages available, reduced coverage, and higher deductibles. Health care costs have also hurt wage increases.
SEMA companies reported that over the last 5 years, company health plan costs generally increased from 20% to 60%. Nevertheless, 32% of the companies had even higher increases, some reaching beyond 100%.
The numbers were evenly split when it came to switching health insurance carriers. A nearly equal number of members stayed with the same provider or changed carriers once, twice, or three times. Cost was almost always the reason for changing plans.
SEMA member companies aware of the legislation support passage of the Association Health Plan in Congress and would likely take advantage of the insurance policies. "The survey results verify that it is time for Congress to address spiraling health care premiums," said Kersting. "One important component in solving the problem is to enact the AHP legislation and give our small businesses access to affordable health care coverage."
At present, trade unions and large corporations are able to offer large-group health plans on a national basis. These large-group plans help reduce health insurance costs. The AHP legislation would provide this same pooling opportunity to small and medium-sized businesses.
SEMA is actively lobbying members of Congress, encouraging SEMA members to do the same, and working with other associations and organizations in a coordinated campaign to pass the legislation. Since 1997, the U.S. House of Representatives has consistently approved an AHP bill only to have it die in the U.S. Senate. SEMA is urging members of the Senate to quickly pass the bill this year and give small companies the tools they need to ensure that American workers and their families have health care coverage.
The U.S. House of Representatives is expected to approve its version of the AHP bill, H.R. 525, this summer. The bill has 135 cosponsors and has been passed in Committee. In the Senate, S. 406 has 12 cosponsors and has been the subject of hearings by two Senate Committees.
SEMA represents the $31 billion specialty automotive industry. Founded in 1963, the trade association has approximately 5,700 member companies. It is the authoritative source of research data, trends and market growth information for automakers and the specialty auto products industry. The industry provides appearance, performance, comfort, convenience and technology products for passenger cars, minivans, trucks, SUVs, crossovers and recreational vehicles. For more information, contact SEMA at 1575 S. Valley Vista Dr., Diamond Bar, CA 91765-3914; call 909-396-0289; or visit www.sema.org or www.enjoythedrive.com.
Below are some of the actual survey questions and responses.
1. How many employees do you have?
1-10 59%
11-20 14%
21-30 8%
31-50 9%
51-100 7%
101-200 2%
201 or more 2%
2. Does your company currently provide health insurance to its
workers?
Yes - the company pays the entire premium 28%
Yes - the employee pays a portion of the premium 41%
No 31%
3. Under your company's health insurance plan, please estimate
how much the premiums have changed in the last 12 months.
Decreased 2%
Increased 1% to 3% 3%
Increased 4% to 6% 11%
Increased 7% to 9% 12%
Increased 10% or more 50%
Don't have health insurance 22%
4. Under your company's health insurance plan, please estimate how
much premiums have changed in the last 5 years.
Decreased 1%
Increased 1% to 20% 9%
Increased 21% to 40% 20%
Increased 41% to 60% 18%
Increased 61% to 80% 11%
Increased 81% to 100% 9%
Increased more than 100% 12%
Don't have health insurance 21%
5. If it becomes possible for SEMA to offer an Association Health
Plan, do you think your company would take advantage of it?
Yes 33%
Very likely 41%
Unsure 20%
Very unlikely 2%
No 1%
Other, Please Specify 3%