After months of debate and countless media stories, we are still no closer to passing comprehensive health care reform…and I am not complaining. While there is little debate about the need for improvements to our health care system, it is thrilling to see Americans educate themselves about the current proposals, with a majority taking a decisive stand against a health care proposal that hurts more than it helps.
As a Director in a medium sized business of about 300 employees, I want to offer some perspective on the health care debate. While it is hip to look at the impact on small business and the quiet support that the current health care legislation has from large corporations, medium sized companies will definitely feel the pain if the current legislation becomes law.
Instead of giving a lengthy dissertation on the potential impact of this 2000 page piece of government bureaucracy, let’s look at some real numbers.
* Currently, our company offers health insurance to every employee. The coverage for corporate employees is subsidized by the company to the tune of approximately $3,000 per year. All other insureds are fully responsible for the cost of their health care coverage, at group rates.
* If we were required to fund health insurance for every employee, this would cost our organization anywhere from $390,000 to $750,000 per year, depending on the type of coverage. This additional cost only covers our employee, not their family. While these numbers are not in the millions, consider that these additional costs represent 35% to 90% of the company’s current gross profit. Suffice it to say, cutting 90% of our gross profit is not a viable business model.
* Health care proposals have suggested an 8% “fee” (otherwise known as a tax) for employers who do not provide health insurance to their employees. For the current year, our company’s gross payroll will be about $12 million. A quick visit to my handy calculator puts this “bill” at $960,000 per year, an even worse proposition and one that would make our company unprofitable.
Without going deeper into the thousands of pages of proposals, we can stop at these few simple facts and consider the fall out. With $390,000 to $960,000 in additional business costs, our options would be:
* Close the business and add about 300 employees to the unemployment rolls.
* Cut the compensation for our employees to account for the increased health care costs.
* Pass the increased costs of doing business to our customers. Who are our customers? The companies who provide you with phone and cable service. The US Government, to whom you pay your taxes. Small businesses who are fighting for a larger market share in a competitive business environment.
The old adage “corporations do not pay taxes” is true. If you think any of the current health care proposals will be a net gain for you, think again. Consider your increased income taxes, the increased cost of goods, and the high likelihood of further damage to our economy with even higher unemployment rates. Oh, has anyone asked how the current population of doctors and hospitals will be able to provide services for an additional 40 million insured Americans?
The vocal supporters of the current health care legislation are looking out for their selfish interests. AARP will grow their Medicare supplement business if the legislation passes. Large corporations will reduce their insurance benefits cost and force millions of Americans onto government health insurance, as these corporations will be more than willing to pay a simple 8% “fee.” Unions support the plan because their membership growth in recent years has come through government employees.
President Franklin D. Roosevelt is quoted as saying “Selfishness is the only real atheism; aspiration, unselfishness, the only real religion.” At this point in our history, we must move beyond individual and collective selfishness that is represented by the current health care legislation. Instead, we should aspire to build on our current system of health care to correct the inequities that exist for a small minority of Americans, without diminishing a health care system that provides some of the world’s best health care to over 300 million Americans. Congress and the President should have the faith to listen to millions of citizens and hundreds of thousands of small business owners who have all arrived at the same conclusion…the current health care proposals will jeopardize millions of jobs and the viability of countless small and medium sized businesses across our country. These small and medium sized businesses employ 60% or more of those employed by the private sector.
