LIA exec: Health reform should focus on cost, quality

HEALTH CARE

The man who started the Long Island Association's health insurance program 16 years ago sounded earlier this week as if he had a frog in his throat, so bad was his head cold. Nonetheless, he managed to talk for nearly two hours to a business group in Melville, delivering grim prognoses for companies coping with high health insurance costs: It's not going to get better any time soon.

Fred Barba, executive vice president for the LIA's Health Alliance, a health insurance purchasing cooperative, told a group that he believed some type of health reform measure will pass Congress this year, but that it won't significantly benefit businesses.

The legislation, Barba said, will only "moderate health care costs" for companies over the next two to three years.

Health care reform, President Barack Obama's key domestic initiative in his first year in office, was dealt a severe blow by the election two weeks ago of Republican Scott Brown over Democrat Martha Coakley in the race for a U.S. Senate seat in Massachusetts. Brown promised to be the 41st vote against Obama's health care reform plan, while Coakley pledged to be the 60th vote for it.

Barba's remarks were not good news to Peter Allen, founder and chief executive of Allen Machine Products in Hauppauge, a 25-year-old company with about 40 employees. The company's health care costs have been rising more than 16 percent a year for at least the last five years, Allen said.

"When I started the business, I was able to pay the entire cost" of employees' health care, Allen said. Obama's initial plan, Allen said, would have helped. "It would have given us some stability. Now, we're in a free-fall."

Barba told the business group the president's plan did not focus enough on cost or quality, but some type of legislation is likely to emerge from Congress this year.

But while the costs spiral and the debate continues, the impact on Main Street is huge, Allen said. "It keeps an aura of concern going in the workplace," he said. "That leads to an underlying fear or concern for how we proceed forward. That can't be a good thing for the creative process. It takes up an awful lot of energy."