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SBCA Urges House Members to Vote Against Senate Health Care Bill

Washington (PRESS RELEASE – March 19, 2010) — The Small Business Council of America (SBCA) urges Members of the House of Representatives to vote against the Senate health care reform bill. The SBCA believes the details of this legislation will not only harm small businesses and their ability to provide health care to their employees, but that it could lead to the ultimate demise of this country’s private health care system. As discussed below, the SBCA supports health care reform, but not as proposed in the House and Senate bills.

“We are opposed to new government mandates on individuals, employers and states, increased federal spending, and the establishment of yet another entitlement at a time when we cannot properly fund existing entitlement programs,” said Ron Waldheger, SBCA Vice President – Health Care Legislation and Cleveland health care attorney.

According to Peter Shanley, SBCA CEO and Wilmington, DE tax and health care lawyer, “If health care is not funded properly through Medicare then the end result will be greater rationing of our health care system and fewer, more costly options for Medicare recipients. The quality and availability of health care will go down and Medicare patients will be hurt in the long run.”

Due to the current lack of proper funding of Medicare, the lack of their bargaining power, and lack of large risk pools, small businesses, states (for Medicaid) and individuals already indirectly pay for the lion’s share of the shortfall by paying higher premiums. In fact, many small businesses can only offer so-called “Cadillac” plans because of the exorbitant premiums charged to small businesses.

Further, the excise tax on such “Cadillac” plans includes the costs of other benefits, such as flexible spending accounts, dental and vision coverage. The new government mandate that small businesses now have to capture the costs of all the benefits in order to comply with the excise tax, makes it that much more likely they will decide to simply stop offering such benefits. The proclamation that “people can keep the insurance they currently have” will become a falsehood, simply because it is not up to the individual to decide what insurance they have, but their employer. The bill House Members are being asked to support, along with a “fixer” bill, will take that option away from millions of Americans.

The currently proposed House and Senate legislation will exacerbate the costs shifted to and paid by small business, the bulk of whose employees are below Medicare age and not eligible for Medicaid. Many physicians will not see Medicaid patients because the reimbursement is so low. Yet the Senate bill would add another 18 million people to Medicaid. Who will treat them? Who will pay for their treatment? We are concerned that the expansion of coverage and reduction of funding will mean even more cost shifting to small business by private insurance, driving up their health care costs even more.

SBCA is very supportive of the need to transform our health care system and believes there are currently several well-vetted proposals that could be put together which would “fix” the small business problem without subjecting small businesses to increased taxes and new mandates. Senators Kerry, Lincoln, Durbin, Snowe and Lieberman (among others) have all come up with detailed health care proposals that would create larger risk pools (essential for small business insurance coverage), deal with the pre-existing condition problem, ensure portability, establish some mechanism to take care of catastrophic health care cases and provide for the deductibility of health care premiums for all small businesses and individuals. Tax credits could be provided to small employers who cover their employees, rather than hitting them with higher taxes and new mandates as the proposed law would do.

We urge our Congressional representatives to consider the detrimental impact this bill will have on their small business constituents, their employees and their families and vote against it. We believe it is important to slow down this entire process, subject it to debate and allow the public to have several weeks to carefully examine the final health care reform bill.

The Small Business Council of America (SBCA) is a national nonpartisan, nonprofit organization which represents the interests of privately-held and family-owned businesses on federal tax, health care and employee benefit matters. The SBCA, through its members, represents well over 20,000 successful enterprises, sometimes referred to as “larger” small businesses, in retail, manufacturing and service industries, virtually all of which provide health insurance and retirement plans. The SBCA is proud to have many of the country’s leading small business tax, healthcare and employee benefit advisors as members of its Board and Advisory Boards.