New Jersey offers group health insurance plan; AVMA mulls options

Montclair, N.J.-It costs George Cameron, DVM, $6,000 a month in health insurance premiums to cover the 20 employees on his payroll. That's not small change, but it's a far cry from the near $96,000 he annually expended for staff coverage before signing on with the New Jersey Veterinary Medical Association's (NJVMA) group health benefits plan - the country's only veterinary association offering such a service

"I just signed up," says Cameron, who runs the Cameron AnimalHospital. "They have my check, it's cashed and I couldn't be more delighted.I'm saving something like $2,000 a month."

NJVMA-AMT partnership

To circumvent red tape stifling the development of association healthcareplans (AHP), NJVMA joined the Association Master Trust (AMT), a not-for-profitnetwork of more than 20,000 participants within 10 state professional groups,including lumberjacks and gas retailers.

Put simply: AMT haggles with insurance providers for low healthcare rates,using its bulk membership as a bargaining tool. The bigger the pool of participantsmeans more AMT leverage, which, in turn, makes its members privy to themost cost-efficient staff benefits available.

No other veterinary association in the country offers such a program.

Insurance in demand

Practice owners have long coveted AHPs for staff benefits because theytypically run 20 percent less than comparable, single-practice packages.Veterinarians such as Dr. Nancy Katz, who's opening the Katz and Dogs AnimalHospital in New Jersey, rely on quality benefits to draw employees.

"Insurance is a huge cost," she says. "But the pros ofoffering it are that you can attract more career-oriented employees.

"If this plan hadn't come about, I'd be offering insurance, butit would be of lesser quality. Providing insurance versus the cost - it'sa true compromise."

Legal roadblocks

While this attempt at group coverage might lighten the insurance loadfor veterinarians in New Jersey, DVMs elsewhere in the country are leftwith little or no option to costly single practice plans.

National groups such as the American Veterinary Medical Association (AVMA)are looking to provide countrywide blanket programs, however, unique statelaws obstruct these efforts.

"In the AVMA's case, you'd have to have 50 different plans to conformto 50 different state laws, which is impractical," NJVMA ExecutiveDirector Rick Alampi says. "And I don't know of any other state asidefrom us that has anything in terms of an across-the-board full health benefitspackage."

AVMA on the move

That doesn't mean leaders aren't working on the issue, says Dr. JanetDonlin, AVMA associate executive vice president. But even if the AVMA'sGroup Health Life Insurance Trust (GHLIT) - the insurance backer providingthe membership with individual coverage - develops national employee benefits,laws in New Jersey and several other states are prohibited from employingthem.

New Jersey law, for example, mandates that all policies must fall intoone of five insurance "templates" approved by the state, rangingfrom the "bare bones HMO to the full Cadillac of medical coverage,"Alampi says.

Federalizing the system

To change all that, AVMA officials are banking on legislation designedto federalize insurance standards and exempt AHPs from state laws and healthmandates deemed restrictive.

One such measure, The Small Business Health Fairness Act of 2001, callsfor the acceptance of AHPs by all states should one state grant approval.

The bill passed last August as a provision of the House of Representative'sversion of the patients' bill of rights, but its Senate companion did notinclude the amendment (see related story, cover, March 2002).

To push its passage, AVMA has joined the Association Health Plan Coalition,a lobbying body consisting of more than 80 professional and trade associations.

"If this federal legislation comes through, we'll be looking ata whole different picture," Donlin says. "There's such a needfor this. It's simply getting harder and harder to find good coverage."