Balancing reform of health insurance

Posted: Monday, September 21, 2009

This editorial first appeared in the Anchorage Daily News:

Health insurance under the current system is a huge, expensive hassle for small businesses. Just ask Laile Fairbairn, managing partner for Anchorage's Snow City Cafe. The company signed up to pay half the costs of employee health insurance in 2004, but had to cancel almost immediately when the rates doubled. Despite the restaurant's success, health insurance "remains out of reach and not by a little but by a lot," Fairbairn wrote in legislative testimony.

Many small-business owners are understandably anxious that health insurance reform proposals in Washington would require them to start paying something toward coverage - which is likely the case. Some definitely can't afford it.

Yet the benefits to small-business workers would be great: They'd get health insurance. They wouldn't have to live on the edge, always fearing catastrophe, as does Ken Carr, who owns and is the sole employee of a property maintenance engineering company.

"It's just a huge burden. It's just really depressing to constantly carry that over your head," says Carr, who has hepatitis and what used to be called a heart murmur - conditions that make individual insurance unaffordable.

His position as an uninsured small-business worker is all too common.

Most Alaska businesses with fewer than 100 employees don't contribute to health insurance benefits for their workers, according to a recent survey of 300 businesses owners by Small Business Majority. The survey found that only 21 percent of them pay something toward employees' coverage.

Leaving so many people uncovered is just not acceptable. But neither is forcing small businesses to go broke. Congress should protect small businesses' viability as it shapes a bill.

At Snow City, with 49 employees, instead of insurance, the company offers health reimbursement accounts worth $1,200 each per year for its employees. Workers bring in medical receipts, and the bookkeeper reimburses them.

"I think the big issue is that people with insurance don't even think about it. It's not their problem. But I see all these employees if they have a medical issue they fight it and fight it until they have to go to the emergency room," says Fairbairn.

She believes health care is a right like police and fire services, and the United States ought to have universal health care.

Kevin Turkington, president of Senior Care of Alaska, offers a supplemental type health insurance from AFLAC for his 60-some workers. Workers pay the full cost, without a contribution from the company. People can buy different types of coverage, say, for hospital stays or cancer treatment.

Turkington is leery of any new government-sponsored insurance, and of any requirement that businesses offer a certain level of insurance. He doesn't think it should be a business responsibility. But he "tends to agree" that everyone ought to have health insurance, just as for auto insurance; and he is interested in the idea of a national, free-market exchange where people could buy policies.

Carr went online recently to look at policies. With his pre-existing conditions, the cost from one insurance company would be $900 a month for a policy with a $10,000 deductible, Carr said. He doesn't have that kind of money. Instead, he recently passed up two blood tests and a prescription recommended by his doctor.

"They should give everybody that doesn't have insurance some option to be able to buy into somebody's insurance, whether it's the federal government, Medicaid, or the VA," Carr says. "If they would just give me some alternative."

Health care reform needs to make affordable coverage available to Carr and the millions of others employed by small businesses. But Congress should do it in a way that keeps costs manageable for business owners.

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