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Many Small Businesses Not On Board With Health Care Bill

Many Small Businesses Not On Board With Health Care Bill

The Dallas Morning News

December 01, 2009

WASHINGTON — For years, small businesses have sought a solution to rising health care costs. Now with the Senate ready to consider a reform bill that attacks the problem and expands insurance coverage, many small firms haven’t signed on to the answer.

The National Federation of Independent Business, the main lobbying group for small businesses, says taxes and fees that would help fund the insurance expansion will be passed on to small firms, which have little bargaining power with health insurers. The federation opposes both the House and Senate bills but says a House requirement that firms provide coverage or a fine is particularly onerous.

In Texas, where fewer than 50 percent of private-sector employers offer health insurance, some small firms say they would be more competitive if they dropped coverage and paid the fine.

“I wouldn’t like it, but it’s what we’d have to do to stay competitive,” said Pete Snider, owner of Mesquite-based Alco Glass, who said the fee would cost less than paying premiums for his workers.

“There are a number of people in my industry who don’t furnish health insurance for their people,” he said.

Supporters of reform say that view ignores the big-picture benefits of the complex legislation. Many economists say the bills are loaded with enough incentives and health system reforms to bring down rising health care costs.

Small businesses would benefit from insurance-industry reforms, including a prohibition on charging higher premiums to small businesses. On average, small firms pay 18 percent more for premiums than larger companies.

Small businesses would also find it easier to shop for coverage. The legislation would create an insurance exchange where consumers and small businesses would be able to compare policies that meet minimum benefit levels.

“The choice factor is huge — the ability to really have significant choice of plans that are competing against each other,” said John Arensmeyer, chief executive of the Small Business Majority, a research and advocacy group that favors the reform legislation.

Firms with fewer than 10 workers could receive a tax credit for two years to make coverage more affordable. These small firms make up the majority of businesses in Texas, but only 26 percent of them provide insurance, according to the Agency for Healthcare Research and Quality.


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