Divided testimony as Connecticut committee weighs authorizing multiple-employer health trusts and studying a Connecticut option

The Insurance and Real Estate Committee on March 3 heard sharply divided views on House Bill 5378, a proposal that would open Connecticut to self‑funded multiple‑employer welfare arrangements and require a feasibility study of a state‑run ‘‘Connecticut option.” Business and small‑employer witnesses urged the committee to approve the measure to give small firms more buying power; advocates and consumer groups warned MiWAs risk insolvency and could undercut consumer protections.

“HB 5378 seeks to allow self‑insured multiple‑employer welfare arrangements,” said Gretchen Shugart, a policy analyst at the Commission on Racial Equity in Public Health, who testified in opposition. “The product is not health insurance,” she said, adding that employer‑level medical underwriting could “exacerbate racial and disability‑based inequities.”

Sean King, general counsel for the Office of the Health Care Advocate, told the panel OHA supports completing a study of a Connecticut option but opposes authorizing MiWAs now. “MiWAs mimic level‑funded plans, allow underwriting and adverse selection, and offer no tools to put downward pressure on medical prices,” King said. He urged that a study compare the partnership plan, a public option and association options before licensing new structures.

Supporters framed MiWAs as a practical response to steep premium increases in the small‑group market. “House Bill 5,378 is a very strong start to address unaffordability for small employers,” said Senator Stephen Harding, who described association plans as a way for trade groups and chambers to pool risk and lower costs. Representatives of regional chambers, industry groups and dozens of small employers described recent double‑digit renewals and said pooled plans would make it easier to hire and retain staff.

Business‑group witnesses also urged regulatory guardrails. Grace Brangman of the Connecticut Business and Industry Association described the bill’s licensing and solvency provisions and emphasized consumer protections: “The MEWA trust is subject to regular examinations and regulation by the insurance department,” she said, adding that surpluses would be used to stabilize future premiums under the bill’s design.

Opponents, including public‑interest groups and some health‑equity advocates, urged caution. Rosanna Ferraro of the Universal Healthcare Foundation said states have learned hard lessons from past MiWA failures and argued the committee should ensure the final study fully examines alternatives including subsidies, a basic health program or a public option before authorizing MiWAs.

The Insurance Department’s interim commissioner, Josh Ehrshman, described other bills before the panel, including a departmental modernization package and consumer‑transparency and solvency proposals. He confirmed the department will examine how any new employer‑pooled plans would be supervised.

Committee members pressed witnesses for evidence and asked the Office of the Health Care Advocate and insurers to provide state examples and comparative analysis. Several members said they supported studying a Connecticut option while keeping consumer protections front and center.

Next steps: the committee chair said staff will continue to refine statutory language and incorporate working‑group recommendations, with additional stakeholder meetings planned before any floor action.