The skyrocketing cost of health care is cited by Chamber members as a top legislative concern. Since 2001, Northern Kentucky insurance costs have increased by over 88.2%, far outpacing national healthcare costs, which increased 70.6%, according to Hewitt Associates, a Chicago based human resources firm. As health care costs continue to rise, employers are finding it increasingly difficult to provide their employees with health care benefits. Employer-sponsored health care insurance has declined by approximately 10 % since 2000 in Kentucky. 

Index Kentucky’s Cigarette Tax

In 2006, the Kentucky General Assembly voted to courageously increase Kentucky’s per pack cigarette tax from 3 cents to 30 cents per pack. The Chamber supported the increase. Since that time, many of Kentucky’s surrounding states have increased cigarette taxes by 40 to 50 cents per pack. Ohio, for example, increased their cigarette tax from 55 cents per pack to $1.25 per pack. Indiana increased their cigarette tax from 55 ½ cents to 99 ½ cents per pack. Tennessee has increased their cigarette tax from 20 cents per pack to 62 cents per pack. Currently, the average of the surrounding states is 69 cents per pack, while the national average is $1.18 per pack.  The Chamber recognizes that increasing cigarette taxes is a very difficult issue for our legislators. Accordingly, the Chamber recommends that cigarette taxes in Kentucky be levied in an entirely new way with priorities for education and healthcare.

Chamber Position:

The Chamber proposes that the cigarette tax be annually benchmarked to the average of the surrounding seven states, and then multiplied by a factor of .80.  Currently, this approach would establish a tax rate of 55 cents per pack (69 cents x .80 = 55.2) and would increase current revenues by an estimated $70 million annually. The Chamber believes this approach would serve as a deterrent to youth smoking, while encouraging healthy lifestyle choices among all Kentucky citizens.  It is abundantly clear that Kentucky’s cigarette tax cannot keep pace with our surrounding states. To deter smoking and raise needed revenue, the Chamber believes this new approach is both innovative and fair. 

Allow Kentuckians to Vote on Medical Malpractice Reform

In the 2010 General Assembly, legislators will have the opportunity to place four (4) amendments on the ballot for Kentucky voters to amend Kentucky’s archaic 1891 Constitution.  One of those amendments should address the growing crisis of medical malpractice reform.

The costs associated with medical liability have significantly increased in the past few years, due to increased frequency of litigation, increases in dollars awarded, the costs of defending frivolous lawsuits, and the costs of defensive medicine.

These increased costs are passed on to employers and employees alike, through increased health insurance premiums.

The American Medical Association has identified Kentucky as one of the 18 “crisis” states in need of fundamental malpractice reform. Rising malpractice insurance premiums are causing medical providers to limit the activities of their practice, stop practicing altogether, or relocate to another state that has implemented progressive reforms.

Chamber Position: 

The Chamber supports a public referendum on a constitutional amendment which, if passed it would expressly authorize the General Assembly to consider the issue of limiting litigation without merit and non-economic awards. The Chamber believes that malpractice caps on awards for non-economic damages and mandatory medical review panels in all medical malpractice cases prior to trial are just two of many alternative ways to achieve broad malpractice liability reform goals.

Oppose New Medical Mandates That Impact Premiums

Currently, Kentucky statutes require employers to include 33 specific medical coverages in their health care policies, but a statutory moratorium to adding new mandated coverages has been in place since July 1, 2006 and expired on June 30, 2008. The Chamber is convinced that any new mandated benefit will, over time, increase insurance premiums.

Chamber Position:

The Chamber calls on the 2010 General Assembly to study and review the current mandated coverages to determine if they meet a cost benefit analysis. Further, the Chamber supports the concept of employer choice, which will allow employers to purchase insurance riders  (i.e. “must offer” rider coverage), in lieu of legislative mandates that have little or no return on investment. We oppose new medical mandates that impact insurance premiums.