Senate Committee Considers Health Care Costs for Small Businesses

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On February 13, Sen. John Kerry (D- MA) called a meeting of the Senate Committee on Small Business and Entrepreneurship to evaluate the current health care landscape for small businesses. The hearing focused on available options, as well as Kerry's contention that there is a need to go beyond Association Health Plans (AHPs) as the sole solution to helping small firms cope with skyrocketing health care costs. In January, Kerry, who is chair of the committee, introduced the Small Business Health Care Tax Credit Act (S. 99) to provide an interim step to help small-business employers while comprehensive legislation is developed.

"The most effective, efficient, and fair solution to the small business health crisis is through fundamental health care reform," said Kerry in a statement. "[D]one the right way, comprehensive health care reform would give small businesses access to functioning insurance markets, ensure that they and their employees have adequate health coverage, and would make insurance more affordable for everyone."

At the hearing, Kerry advocated for universal health care coverage, as well as other policies that he contends would help small businesses now, while moving the nation toward comprehensive reform -- including federal reinsurance for high cost cases, responsibly expanding coverage pools, and a 50 percent tax credit for small firms that provide coverage to their low- and moderate-income employees.

Mary Beth Senkewicz, formerly with the National Association of Insurance Commissioners, testified at the hearing that, to ensure affordable, adequate coverage, there needs to be larger and more efficient pooling for small firms in order to spread the risk and level the playing field. She also advocated for federal subsidies -- including tax credits -- to assist with purchasing health insurance. "The simple fact is health insurance costs a lot of money and a lot of people simply can't afford it. It's going to cost tax dollars to provide subsidies so people can become insured and access the health care system most efficiently," Senkewicz said.

In January, ABA contacted Kerry and Rep. Nydia M. Velazquez (D-N.Y.), the chair of the House Small Business Committee, to request a meeting in the near future to discuss issues of importance to its members, including small business health care options. --David Grogan