One-Size-Fits-All Health Care Hurts Small Businesses, Workers

Date: September 02, 2020

Editorial by NFIB Colorado State Director Tony Gagliardi

Colorado’s small businesses make every effort to provide their employees with comprehensive, flexible, and affordable health-care coverage. Now, proposals to implement a government-controlled health care system—whether through Medicare for All, single-payer, or the public option—threaten to undermine the years of work small businesses have put into these efforts. Lawmakers need to find a better way to lower health-care costs and increase coverage because this kind of one-size-fits-all approach will not work for local businesses and the employees who work for them.

For years, small businesses have faced increasing health-care costs and administrative burdens. However, many still choose to make these investments because doing so provides a key competitive advantage that helps them build a talented workforce, enabling smaller firms to compete with larger companies. Moving toward a government-controlled system like the public option could increase the burdens many small businesses face, particularly in Colorado’s many rural communities where opportunities for growth are already limited as it is.

A public option could also be the end of private and employer-sponsored plans as we know them. Because a public option would be financially backed by the federal government—and because it would not be subject to the same overhead costs as traditional insurers—there would be no chance for true competition in the individual marketplace. As such, private insurers would begin to leave the market, resulting in fewer and fewer options for small businesses to provide their employees and increasing premiums in the private plans that remain. This would keep happening until the only plan left standing would be the government’s public option.

Eliminating one of the key tools small businesses have at their disposal for employee recruitment and retainment would not only hurt small-business owners but would undermine the coverage employees are generally happy with. This would be especially harmful for Colorado families who have children with challenging health-care needs; for these folks, the uncertainty of what would and would not be covered under a public option system is too great. We cannot let lawmakers pull the rug out from under them.

Currently, there are some 180 million Americans who rely on employer-sponsored coverage to access the health-care services and treatments they need. Any attempt to lower health care costs and expand access should not come at the cost of taking away coverage from anyone, let alone hundreds of millions of Americans. Moreover, the cost of a government-controlled, health-care insurance system would fall on American workers and taxpayers, making this an even less attractive option.

According to a new report by the Committee for a Responsible Federal Budget, the public option could add as much as $1.35 trillion to deficits over a 10-year period. Other projections indicate that, in order to pay for such a huge government program, the average American worker could face a 4.8 percent payroll tax increase, amounting to $2,300 in higher taxes annually. The entire point of health-care reform should be to lower costs, not increase taxes on hardworking Americans.

NFIB Colorado has long supported efforts to make health-care coverage more affordable and more accessible for small businesses and their employees. However, a public option would accomplish neither of these goals. If our lawmakers in Washington or in Denver truly want to help, they should start by addressing the mandates and administrative burdens small businesses face. Improving our current system is a much more practical way to do that than trying to start over with a government-controlled one that small businesses and their employees can’t afford.



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