According to the Center for American Progress, small business owners and their employees account for more than half of our country's uninsured population of 47 million. This may surprise you, but the reason for this coverage gap probably will not: COST.
Small businesses are disproportionately hurt by the health care status quo, and currently pay an average of 18 percent more than larger firms for the same health insurance coverage. A recent analysis from MIT finds that health insurance reform will save small businesses 25 percent in premiums over the next ten years. That adds up to $65 billion, an amount that would allow small businesses to preserve or create 80,000 jobs over the next decade, and increase the take-home pay of workers in small businesses by nearly $30 billion a year.
Meet Melanie Collins. Eleven years ago, Melanie opened a child care business in her home after years of practice as a registered nurse. Currently, caregiver and small business owner Melanie pays $457 per month for family coverage through Maine's Dirigo Choice subsidized program for small businesses--well over 10 percent of her net income. But if she were to buy a plan on the open market in Maine today, she would be facing deductibles and out of pocket limits upward of $10,000 per year.
Like many small business owners taking it on the chin with the skyrocketing cost of health insurance, Melanie's premiums to cover herself and her two kids have more than doubled in the last year.
"I know firsthand the challenges parents face as we try to make ends meet under the burden of increasing health care costs.
I'm one of the lucky Maine small business owners who purchase health insurance for my family through the Dirigo Choice program. I'm fortunate that my one employee has coverage through her husband's employer because I simply couldn't afford to provide the health insurance coverage needed. My premiums to cover me and my two kids have more than doubled in the last year and now I'm noticing charges for tests and procedures that were once fully covered. If these increases continue, I may have to close my business and find a job that offers affordable healthcare."
It's small businesses that are going to pick the country up out of this recession, but to make that possible, we need to fix America's health care system so we can keep offering critical jobs and important services to our communities.
What healthcare reform would mean for Melanie:
Real relief for small businesses and their owners
Currently, Melanie's plan includes a $1,000 deductible and a $3,200 limit on annual out-of-pocket costs. If she bought a plan on the open market in Maine now, she would be unable to find a plan with that low of a deductible and similar limit on out-of-pocket expenses. Instead, she would be facing deductibles and out of pocket limits upward of $10,000 per year.
Under both the House and Senate bills, Melanie would find more affordable, dependable coverage in the health insurance exchange, and Maine would be able to end the Dirigo Choice program--saving money for the state. To cover her and her two children in the exchange, Melanie would see her premiums fall by more than half in both the House and Senate bills, where she would pay 6 percent to 7 percent of her income for premiums (approximately $216 per month).
However, under the House bill, Melanie would also find a comparable plan with low deductibles and out-of-pocket limits, while under the Senate bill she would face more cost sharing. Melanie's employee would also be able to find affordable coverage in the exchange. As a very small employer, Melanie would not be required to provide coverage in either the House or Senate bill, and would face no additional fees or taxes beyond the cost of her premium.
The Faces of Healthcare Reform: At both bargaining tables and kitchen tables across the nation, SEIU members have faced increasingly tough decisions about their health care--often sacrificing wage increases for benefits, or going without health insurance entirely. Read more personal stories told by SEIU members on the health insurance reform would make in their lives here. Blog profiles of members here.
Stay tuned to SEIU's Blog for more stories on how reform will impact SEIU members.
