Brooklyn's Progress
January 2004

Brooklyn Chamber President Kenneth Adams testified before the City Council of the City of New York Committee on Economic Development and the Committee on Health on Dec. 10, 2003.  The hearing was about the availability of affordable health insurance for small businesses and independent contractors.

Following is his testimony:

“Good afternoon, I am Kenneth Adams, President of the Brooklyn Chamber of Commerce, a business assistance and economic development organization with over 1,200 members.  The mission of the Brooklyn Chamber is to help businesses grow and to promote the economic development of Brooklyn.  To that end, the Brooklyn Chamber advocates for projects that create jobs and stimulate investment in the borough’s economy.

I am here today to testify on the availability of affordable health insurance to small businesses and independent contractors. 

In September 2002, the Brooklyn Chamber of Commerce was commissioned to conduct a study of the Brooklyn business community.  The purpose of this study was to obtain a measurement of the impact the September 11, 2001 attack on the World Trade Center had on the Brooklyn business environment, and to identify current obstacles to survival and growth these businesses face.  As such, the survey represents the most comprehensive study of the Brooklyn business community undertaken in the past 20 to 25 years.

The six-page survey was mailed to over 27,000 Brooklyn-based businesses employing three or more employees.  The overall response rate was 4%, (1,085 responses), a rate at least double the industry standard of a 1 ﷓ 2% rate generally achieved from a study of this type.  The response rate was 10% for the BCC Members and 3.4% for non-members.  A cross-section of industries and business types were represented, with retailers, manufacturing firms, health care companies and construction firms representing the top four sectors that responded.

When asked to rate various obstacles to business growth, 67.3% of responding companies cited “increased cost of providing health insurance for workers” as a “problem or severe problem.”  Only 47% of the responding businesses indicated that they provide health insurance coverage for their employees.  The highest levels of coverage occurred amongst older/mature businesses (10+ years in existence).  When asked if the company would be interested in offering employees an “affordable, low-cost health insurance plan specifically designed for Brooklyn small businesses,” 60.7% indicated “yes.”

We were not surprised by the responses from the survey, it confirmed what we knew and solidified the need for us to move ahead with developing a product to address the issue.  Access to high quality, affordable health care is good for the borough, its businesses and all of its residents.  For almost four years, the Brooklyn Chamber of Commerce has worked closely with GHI, many of the borough’s health care providers, elected officials and community leaders to develop Brooklyn HealthWorks, a program that will provide affordable health insurance products to uninsured, low-wage workers in eleven northern Brooklyn Community Boards -- 1-5, 8-9, and 16.  This includes the neighborhoods of Williamsburg, Greenpoint, Fort Greene, Bedford-Stuyvesant, Ocean Hill-Brownsville, Bushwick, Crown Heights and East New York.  The service area was established to meet the requirements of the program’s funders.  The target market will include nearly 40% of the population of Brooklyn and nearly 11,500 businesses.  We estimate that there are 700,000 Brooklynites without health insurance.  

We have developed two products, Brooklyn HealthWorks, a low cost health insurance plan that will be sold to small businesses where low-wage, uninsured workers are employed; and Brooklyn HealthWoRX, a prescription drug discount card sold directly to qualified individuals who live or work in our demonstration area.

The Brooklyn HealthWorks Insurance Plan will addres the needs of low-wage workers who cannot afford health insurance because of more pressing needs, such as rent and food. Participants in the program will be individuals and families with incomes between 150-250% of poverty (approx. $27,600- $46,000 per year for a family of four).  These are Brooklynites earning too much to qualify for Medicaid and Family Health Plus, but not enough to afford health insurance policies currently on the market.  Premiums (including pharmaceutical benefits) will be as low as $115 a month for individuals and $335 a month for a family of four. 

Brooklyn HealthWorks Insurance Plan is a $1.6 million initiative supported by two major 3-year grants – the Robert Wood Johnson Foundation and Health Resources & Services Administration of the U.S. Department of Health & Human Services.  Additional funding is provided by New York Community Trust, United Hospital Fund and Sirus Fund.  These grants will pay for product development and administrative costs, significantly reducing the plan’s monthly premium cost.  

Brooklyn HealthWoRX-Express Access Card is administered by Express Scripts, one of the nation’s largest independent pharmaceutical benefits management companies.  At a cost of $10 a year for an individual and $25 for a family, the card is accepted at more than 350 participating pharmacies in Brooklyn, and over 39,000 pharmacies across the country, as well as a mail order pharmacy which offers larger discounts.  Cardholders receive immediate discounts on their prescribed drugs (9-29%, or more).  Member Service assistance is available via phone or Internet 24x7.

The Brooklyn Chamber of Commerce, the Office of the Brooklyn Borough President, a consortium of health care providers, business groups, community agencies and Group Health, Inc. (GHI), and Express Scripts are working together to develop and market these products.  We are grateful for the cooperation and support of the Superintendent of Insurance, Gregory V. Serio and State of New York Insurance Department.

While Brooklyn HealthWorks and other programs make health insurance affordable to the underserved population, they are still unlikely to make it truly affordable to all who need it. 

Thank you.”