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Juni 08, 2009

Why We Can’t Afford NOT to Reform HealthCare, Even in this Economy

Business Etiquette Rules
Anita Campbell

CEO, Small Business Trends LLC

Summary

For millions of people, the health care system in the United States is a mess.  People are sick ... and tired ... of having a problem that g

For millions of people, the health care system in the United States is a mess.  People are sick … and tired … of having a problem that grows worse each year.  Change is in the air.  The problem is, can we afford to reform the healthcare system?


Well I have a suggestion for how to afford it.  First, though, some background….

How Small Business Are Affected by Healthcare

The healthcare problem hits small businesses particularly hard.  According to the National Federation of Independent Business (NFIB), the cost of healthcare has been the #1 issue for small businesses for over 2 decades.  Amazing, isn’t it, that no one has solved the problem in all that time.

It’s an issue that doesn’t stop just with small businesses, but affects our employees, too.

Fewer than half (47%) of small businesses offer health care benefits to employees.  Of the ones that do, their employees likely have more limited coverage and contribute more toward coverage, than do employees in the large companies.  Employees in the smallest businesses pay an average of 18 percent more in health insurance premiums for the same benefits than those in the largest firms, according to research compiled by the NFIB.

What’s worse, new business owners are reluctant to offer healthcare insurance out of fear that coverage will become too expensive.  So the problem will only get worse if something isn’t done.

It seems to hit the smallest businesses — the solo business owners and microbusinesses with under 5 employees - the hardest.  These are the businesses least likely to have enough revenues to pay for health care. (For more statistics about small businesses and health care, check out the site dedicated to this topic, Fixed for America.)

A Growing Consensus: Something Must be Done

That’s why many are finding the concept of health care reform an attractive idea.  It’s just too big an issue to ignore.

Even Harry and Louise, the iconic spokespeople against the Clinton health plan, have been brought back, this time in favor of healthcare reform (although what that reform is, is not specified) and with the support of the NFIB and the American Hospital Association.

Not everyone agrees on how reform should happen, to be sure.  But most would agree something has to be done.

Right now in Congress, one party is insisting on some kind of government-related initiative, while others are saying a governmental plan is a non-starter, according to this USA Today article.

As much as I hate big government — and I’ve never met a tax increase I like — this is one situation where it seems to me the problem can only be solved by offering some kind of government intervention, including some kind of government plan to cover the uninsured and make it so that everyone has coverage.  Would that be any different from social security, which serves as a safety net for those who need it?  It seems to me that civilized societies provide these kinds of safety nets for their citizenry.

For those who can afford private insurance, I advocate a plan that allows you to continue to get your own insurance.  For instance, in our family, we use a high deductible plan with a Health Savings Account.  That, combined with the existing tax deduction for healthcare premiums for the self-employed, works very well for us.  We’ve had the good fortune of not being heavy users of medical services (knock on wood).

But the high-deductible/HSA option is not right for every family.  For those who need something with a smaller deductible outlay, or who can’t afford the upfront payments to pay healthcare premiums or fund an HSA in the first place, or who can’t get coverage at all due to pre-existing conditions, etc. — well, there should be an alternative available.

How to Pay the Price Tag for Reform

One big problem is how to pay for healthcare reform.  President Obama’s proposal to provide a government health care option carries with it an expected price tag of over $1 Trillion (that trillion with a “TR”).

You know what that means:  increased taxes. Ugh.

However, I’ve resigned myself to the fact that tax increases are inevitable — don’t let anyone kid you.  You can’t spend without eventually paying for it.  It’s simple accounting.

I suggest, though, that we could avoid burdening ourselves with even more tax increases if we just ditch some of the spending pushed through under the guise of “stimulus.”  The economy is already showing small signs of recovery and will likely recover on its own without stimulus anyways.  Much of the stimulus money is going to subsidize certain industries or certain congressional districts, and much of it would not even kick in until 2010 and beyond, anyway.

Instead of spending all that unspent money on stimulus, put whatever money has not been used, to better use.  Fund a healthcare initiative to improve the lives of our citizens who need healthcare, including millions of small business owners/employees.

Somehow we have to figure out how to afford solving an important societal issue, without bankrupting the country and its businesses.

I am sure my remarks will raise agreement as well as vehement disagreement.  So have at it.  What do you think we should do about healthcare?  Share your views in the comments.