The cost of health care remains small business owners’ number one concern. The issue remains at the top of NFIB’s agenda in Washington and on Beacon Hill.
In Boston, Governor Baker’s FY 18 budget proposal contains a new ‘Massachusetts only’ tax on small and medium-sized businesses to fund the bailout of the state’s Medicaid program. Companies that contribute less than $5000 to a worker’s health insurance or have less than 80 percent of their workers accept the offer of insurance would face a $2000 per head tax.
First, the proposed tax is incredibly unfair. Most small business owners have redesigned their offerings to make them affordable for the business and the workers. Meanwhile, state government made the taxpayer funded MA Health program more robust. Legal barriers to workers accessing the state plans were removed. Now when workers choose the plan that is best for them and their families, the state has proposed a new tax on innocent employers who are trying to do the right thing but have no control over workers’ choices.
Second, the tax will not change business or worker behavior. Actually, more workers will be encouraged to choose taxpayer-funded health care and further burden the state budget.
Third, this tax is only a band-aid on the bigger problem – the increasing cost of health care and in particular the state’s unsustainable Medicaid program. Health care now consumes more than 40% of the state budget and its share is growing unabated, squeezing out education, transportation, and other essential services. The small business tax will at best paper over the real problem for a short time. Finally, with big changes in health care policy coming from Washington, now is not the time to impose new cost increases on MA small businesses. MA small business owners should contact their legislators and ask them to reject new health care taxes in the state budget and consider comprehensive health care legislation later in the year.