Niagara Gazette

Columns

September 30, 2013

CONFER: Obamacare harmful to chambers of commerce

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.

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