Niagara Gazette — Chambers of commerce provide immeasurable benefit to their members. They serve a community’s enterprises with a dual-purpose role of marketing the specific region – and individual businesses – and acting as their voice when it comes to public policy. Most small businesses find it difficult to do those tasks solely and effectively on their own. To do them well it takes considerable money. Mass marketing via local newspapers, tourism magazines, broadcast media and the internet is not cheap. Advertising fees, trade shows, networking, and personnel costs add up in a hurry.
To cover those costs and keep membership affordable, most chambers pursue alternative revenue streams. Among them is the offering of health insurance. Pooling together the buying power of their members, they can get insurance at much lower rates than individual businesses would on their own. This benefit – thus membership – is typically extended to the community at large (not just businesses) as means to secure more revenue from membership fees of those folks who might not have any need for the chamber’s other services. That source of income, which for many chambers accounts for a quarter of their clientele, is significant and it keeps overall membership fees down while affording chambers the funds to focus on policy and promotion.
Unfortunately, that practice looks to be on its dying bed. And, so do many chambers of commerce. Obamacare’s health insurance marketplaces (exchanges) will put stress on chambers by taking away their ability to attract members solely on the basis of health care. A good many non-business and small business enrollees will drop out of their chamber and enter the exchange, duped by government reports that insurance purchased on the alleged open market will be cheaper.
Take New York for example, where residents have been told that healthcare costs will drop by 50%. State officials figure that 615,000 will now buy insurance on their own in the first few years of Obamacare and that’s what is driving down the costs. According to reports, regulators have approved rates which for their gold plan which are below the average HMO cost in the state.
But, they’re not comparing apples to apples. The HMO used in the comparison has everything that you’d expect of health insurance – affordable copays, access to doctors and hospitals of your choice, and low out-of-pocket expenses. The state’s gold plan, on the other hand, covers just 80% of expenses. So, compared to an HMO plan, consumers will be paying much more, not necessarily up front in the premium but when all is said and done, as any services utilized will be billed to the insured at 20% of total cost. At that rate, a stay in the hospital will bankrupt working class families. Even fees for lab work, emergency rooms, and the like will strike many an unsuspecting pocketbook.
What does that mean for chambers? After having lost their partners who naively buy into Obamacare propaganda, overall chamber membership could decrease by a quarter for chambers across the nation.
If chambers’ primary revenues wither away, in order to maintain the same quality of service when it comes to marketing and civics, they will have to boost their rates. That increase could make or break the budget of a very small participant (like an ice cream stand or diner), especially if that corporation purchases health insurance through the chamber, because, accordingly, insurance costs will rise for everyone in the chamber because the buying power of that co-op decreases when people leave it.
Or, to keep everything inexpensive, and not lose more paying customers, chambers might also ditch services deemed less important to the overall goal of the chamber to promote the region they serve. As an outcome, policy arms will be cast aside. That plays to the favor of Big Government because the small businesses would lose the skills and abilities of someone deeply involved in public affairs.
Because of these issues, chambers of commerce — and the businesses they promote and protect -- will suffer. Some chambers that rely on individual and family health insurance as a means of survival will die. Businesses, in turn, will do the same as their very best advertiser and cheerleader goes silent. It’s yet another frustrating domino effect of Obamacare.Gasport resident Bob Confer also writes for the New American magazine at TheNewAmerican.com. Follow him on Twitter @bobconfer