Hey Mike Chaney, you are in the hole; quit throwing good money after bad

August 23, 2013

COLUMNS

Nancy Anderson, MBJ contributing columnist

Nancy Anderson, MBJ contributing columnist

I really don’t understand what Mike Chaney is doing.

At first, Insurance Commissioner Chaney’s office led the way in developing health care exchanges to comply with the Affordable Care Act. States all over the country called asking for help from little ole Mississippi. For once, we appeared to be ahead of the curve.

That plan ran headlong into the hard head of Gov. Phil Bryant. Because of the disagreement between the two officials, this first effort was a “no go” and did not get the approval it needed. As a result, the federal government took over the operation of the exchanges.

Undeterred, Chaney proceeded with a different type of exchange. It’s called the Free Market Small Business Health Insurance Option. Maybe the phrase “Free Market” will get it past the governor’s desk, but I wonder if this is a reasonable alternative to what the federal government is offering.

The Affordable Care Act (Obamacare) has a clause requiring businesses to provide health insurance to employees. Of course, it only applies to businesses with 50 or more employees. Over half of businesses in Mississippi have four or fewer employees, so who cares? Right?

Well, every business owner faces the reality of competing for employees. Health insurance is an expectation that most applicants bring to the negotiating table. How do you provide such coverage when you lack the cost advantage of a big company? An exchange seems a logical option.

But there’s a problem. Participants in this exchange won’t be eligible for the federal subsidies allowed on the other exchange. Won’t my employees be better off going through the federal exchange? If so, the exchange won’t stand a chance without the critical mass necessary to bring down overall costs.

Yet, Chaney persists. He has even applied for additional grant money to continue with this effort. Mike, give it up. You already spent $11 million and had to walk away from the effort. Don’t throw good money after bad!

» Nancy Lottridge Anderson, Ph.D., CFA, is president of New Perspectives Inc. in Ridgeland — (601) 991-3158. She is also an assistant professor of finance at Mississippi College. Her e-mail address is nanderson@newper.com, and her website is www.newper.com.

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3 Responses to “Hey Mike Chaney, you are in the hole; quit throwing good money after bad”

  1. joneal4@gmail.com Says:

    As usual, spot on Ms. Anderson. And I’m assuming the businesses with 50+ would not be in this exchange. Along with those businesses getting another year’s extension, that would mean even less critical mass in the new exchange.

  2. wayne garrett Says:

    I hope you meant e-mail????Nancy you don’t have a clue what it means to own a business! All you know is what you have read in a book. I have been in Ins for 45 yrs. This problem is to make ins. ind. fail. When you have 45 yrs then tell me what I or we need. DR!

  3. James Says:

    Your facts are all wrong. A small business exchange is for just that…a SMALL business of 50 or FEWER employees. Pointless article based on misinformation.

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