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Small business—lifeblood of the American economy, right? Well, not for long if we don't do something about health care costs. Reed Abelson of the New York Times reports this morning something every business owner in Lake County already knows: small businesses are struggling much more than big corporations to keep up with skyrocketing health insurance premiums and provide their employees coverage.
One solution: give small businesses the power to form purchasing pools or join state pools. Connecticut's legislature tried last month to let small businesses into the 200,000-employee strong state health pool; Republican Governor Rell, at the behest of big insurance companies, vetoed that plan.
High insurance premiums and the profit-based discrimination of the insurance companies put all sorts of market-skewing pressures on small businesses. As Abelson reports, a small business can take a huge hit in its health budget simply by replacing a 25-year-old male worker with a 35-year-old female worker. Sure, there are laws against hiring discrimination, but suppose a small business owner is looking at three applicants for the same job: a 25-year-old male, a 30-year-old female who just got married, and a 55-year-old male. Even the most virtuous employer is going to feel some pressure to keep health care costs down by finding a way to justify hiring the young guy.
Joining bigger pools offers some insulation against price shocks, and I'm glad to see some states working toward that goal. But why not go with the biggest pool possible, a universal, single-payer, not-for-profit health care system that covers every person in the country, no matter for whom they work? Then small businesses could dedicate their resources to hiring the best people and producing the goods and services they are experts at. Plus, in a globalizing economy where even small businesses compete against foreign firms, our small employers would be on a level playing field with employers in the rest of the industrialized world where government takes care of health care costs.
Read more: Reed Abelson, "Small Business Is Latest Focus in Health Fight," New York Times, 2008.07.10.
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3 days ago
This may be one important benefit not widely discussed as a result of national health care: economic growth by eliminating one huge barrier for entrepreneurs. Think of all the people unwilling to risk health and savings so stay with safer employment although they have much more to offer on their own or with a small organization (that may not exist or doesn't have health care). John Hess
ReplyDeleteQuite honestly, despite my comment on your post earlier today, I like the idea of one large, unified, and (dare I say) socialized health care system.
ReplyDeleteI once corresponded with Paul Wellstone about this matter (years ago!) and he did not mince words: "The answer is socialized medicine."
As a small business person (double word no accident here!), I fear the prospect of financial ruin from denied claims just as much as hardship at the hands of a bloated government or perverted taxation scheme.
I would suggest, insofar as taxes go (and that is how this would be funded, instead of premiums to insurance companies), that the government get totally honest about it. Get rid of the payroll tax for social security, and get rid of the Medicare tax. Don't impose a value-added tax (VAT) or national sales tax. Just have a single income tax that pays for everything, and let the rates be what they must be. Progressive, too, with a substantial exemption to help low-income people.
No stealth taxes, less paperwork, and total transparency. Let us, the people, decide what we want our government to do for us, tell the government how much we are willing to pay for those services, and then let the government charge us a clear price according to our decision.
The top rates of such a tax would have to be high, although not excessive if we can refrain from embarking on too many misguided and self-destructive foreign adventures, and if we can keep ourselves from lashing out with a vengeance against imagined, as opposed to real, corporate greed.
Maybe it's no accident that "intelligentsia," artists, writers, and professors seem to be found in abundance and diversity in "liberal" countries. I'm reading a book about France right now, where, ironically, the VAT was born. People like me seem to survive and even thrive there.
That said, I have some of the basic fears about socialized medicine that are most often stated: No choice, no recourse for malpractice, overuse by people who abuse themselves, and the elimination of the livelihoods of some individuals who thrive (like parasites, perhaps) in the current system.
Oh, and another thing. In the past, a couple of times, I put off going to the doctor until I was so sick that I feared for my life (and the doctors did, too, when they saw me). Such a paradigm cannot continue to work indefinitely as I age. If I could just go and not have to worry about financial ruin, I might go to the doctor sooner, get serious conditions diagnosed earlier, and thereby live longer.
I'm quite willing to pay a reasonable price for such a system. But as I said in the other post, we had better be mighty careful about the scheme we devise to pay for it. And those who get the money had better be held accountable for what they do with it.