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The Business of
Health Care Report As 2001 begins, small business owners have some reasons to be upbeat, even as the economy slows. For more than a decade, small business owners have identified health benefits as their single largest problem. First, getting anyone to underwrite small group health insurance is difficult. Currently, small business owners must pay up to 40 percent more than Fortune 500 companies and large labor unions for the same insurance coverage for employees. Then, the premium increases force many small firms to reduce coverage, increase deductibles and employee co-pays, or drop coverage altogether. Those increases have averaged 10 to 15 percent in each of the last three years, according to some reports. Also, the ranks of the uninsured in America have grown to 44.3 million. About one in six of the working uninsured are small business owners. Among the relief small business owners hope to see under the new Bush administration is the ability to deduct health insurance costs for people who pay at least half their own insurance premiums. Under current law, deductibility is being phased in gradually, with 100 percent of the costs to be deductible in 2006. Small business advocates are pressing for full deductibility as early as 2001. Business advocacy groups hope Bush will help make it easier for small companies to pool their resources to buy less expensive health insurance. Many states bar businesses from joining association, or "pooled" group plans. A desired federal law would supersede state legislation. During his campaign, President Bush expressed support for small business pooling. The "little guys" could then achieve the same economies of scale and the same negotiating clout the big boys have. Without these plans, many small business owners are unable to afford insurance for their employees, which can put them at a disadvantage in attracting and retaining good workers. If you have comments on health care or suggestions for topics to be addressed on this program, e-mail me at DougHawthorne@TexasHealth.org. ©
2001 Texas Health Resources |
