In a recent HBJ article, Michael Waterbury, CEO of Goodroot, criticizes Connecticut’s Senate Bill 11 (SB 11), particularly Section 12, as a harmful measure for businesses that use self-funded health plans. He argues how this bill would force companies back into the expensive, opaque fully insured systems dominated by large insurance companies. Self-funding allows businesses to control healthcare costs, make data-driven decisions, and tailor benefits for their employees- offering transparency and cost efficiency. SB 11 proposes a uniform $250,000 stop-loss attachment point for all self-funded plans, up from as low as $20,000 for smaller businesses- making self-funding unaffordable for many. Section 24 also introduces changes to pharmacy benefit manager (PBM) regulations, potentially raising drug costs and shifting more expenses to employees.
Waterbury argues this bill would overall increase employer costs, reduce employee benefits, and undermine fiduciary responsibilities, while only benefiting big insurers. He believes SB 11 is a step backwards and is urging lawmakers to support self-funding as a viable path toward real healthcare reform. Here’s an excerpt from the article:
SB 11: A Death Sentence for Self-Funded Plans
“This bill doesn’t just nudge employers away from self-funding—it blows the whole system up. It saddles self-funded employers with a massive new financial burden, imposing a blanket aggregate attachment point of $250,000 for all businesses offering self-funded health plans. That means that every self-funded employer, regardless of size, would be forced to cover the first $250,000 in medical claims out-of-pocket before their stop-loss insurance started paying. This change would hit small-to-midsized businesses especially hard, increasing from the current $20,000 threshold for employers with fewer than 50 employees.”
“If this bill passes, these businesses, the backbone of Connecticut’s economy, would be left with impossible choices: absorb crushing costs, cut jobs, wages, or benefits to afford coverage, or surrender to the fully insured market—where big insurance can drive up costs unchecked, piling on hidden administrative fees and padding their profits with little to no accountability.”
