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State Expands Health Insurance Options for Small Businesses Beginning April 1


CONTACT: Tami Torres
(850) 413-2842

TALLAHASSEE – Florida's Chief Financial Officer Tom Gallagher today announced that new health insurance options will be available to small businesses beginning April 1. The health plans could save employers as much as 20 to 40 percent in premiums. All insurance companies that write coverage in the small group market must offer the new plans.

"Redesigning and expanding the number of health insurance plans available to small businesses and pursuing other market reforms will help employers continue to offer coverage to their employees," said Gallagher.

The new plans, often referred to as standard and basic plans, include Health Maintenance Organization (HMO) co-pay plans, HMO co-insurance plans, indemnity insurance plans and Preferred Provider Organization (PPO) insurance plans.

The standard plans were revised to include features consumers were demanding, including increased lifetime maximum benefits and prescription drug coverage. The basic plans were restructured to be more affordable and include a wider range of cost-sharing options such as varying levels of deductibles and coinsurance, and the option to use Medical Savings Accounts.

The new plans were developed by the Small Employer Benefit Plan Committee, which was appointed by Gallagher last June. As the state's former Insurance Commissioner, Gallagher established the committee to explore options for making health plans more accessible and affordable for small businesses.

At that time, he cited concern that rising premiums would force many small employers to stop offering coverage to their employees. In 2000, health insurance premiums among Florida's small employers rose by an average of 16 percent. That number increased to 24 percent in 2001.

A recent statewide survey conducted by the Florida Chamber of Commerce confirmed Gallagher's concern. Of 4,000 employers surveyed, nearly half said that they may be forced to drop health insurance if they continue to experience rate hikes.

There are nearly 1.3 million Floridians who are covered in the small group health insurance market, which represents employee groups of 1 to 50. In 1996, there were 1.6 million Floridians covered in this market.

Previous releases and a copy of the Small Employer Benefit Committee's report are available as links to this release on the department's web site at

Press Release - November 1, 2002

Press Release - June 5, 2002