Strategies: Small businesses suffer on health care issue

Something must be done — and done now.

Here's what I wrote in 1993, the last time health payment reform was seriously considered:

"When it comes to the debate over health insurance, one thing is for certain: the current system is terrible for small business ... small businesses usually have the hardest time getting insurance, the smallest choice among providers, and pay the most for the least coverage. Many people who would like to start new businesses are stuck in jobs because they can't afford to give up health insurance from their current employer. So, please Mr. President and Congress Members, give us a break!"

Here's what's happened since. Things have gotten far, far worse.

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The percentage of small businesses offering health care coverage has withered, employees pay more and health costs have shot through the skyscraper's roof.

Market forces have not — and will not — work. We need government intervention and a public health insurance option. Or, trust me, five years from now, if you own or work for a small company, you will not be able to afford health insurance.

Our current system of health care payment developed in the 1950's and 1960's, when our fathers worked for big corporations and health care was cheap. It made sense that health insurance was provided by large corporate employers. Now Dad — and Mom — and you — are self-employed or work for a small service company or start-up that could be the next Google.

The system must be changed.

Here's how it really works for small businesses:

• You're interviewing two candidates for a job. One is in his 20s — he'll cost less than $200 a month for health insurance. One's in her 50s — she'll cost more than $700 a month. Our current health payment policies contribute to age discrimination.

• You look at your income statement. By far, your fastest growing cost is your health insurance. Small businesses pay nearly 20% more than big corporations. So, you decide to not hire, use independent contractors, or end health insurance altogether.

• You want to leave a lousy job and start a business, but you can't afford health insurance. You never launch the business that might one day employ others.

• You get laid off. You become self-employed. You can't afford COBRA, so you go without health insurance and pray you don't get sick or injured.

• You pay hundreds of dollars a month for insurance. But your co-pay and deductible is still thousands of dollars a year. You — or your employees — hesitate before going to the doctor. Your condition gets worse.

Small businesses need reliable, predictable health care costs that are competitive with big corporations and foreign competitors. A public health insurance option — whether at 8% of payroll or $750 a year per employee — gives us that. If you want, and can afford, to purchase private insurance or supplemental insurance (which, like with Medicare, I'm sure will develop), you should be able to do so.

Those who want the government to do nothing want you to believe that if the government gets involved you won't have your choice of doctors, your choice of treatment. What world are they living in? I have the same situation right now, and I have expensive insurance. My insurance company determines which doctors are in my network, must approve my treatments and negotiates how much and whether they'll pay for treatment. And these insurance companies are more beholden to their shareholders than their policy holders.

Something must be done — and done now.

In 1993, I saw the same groups line up against health care payment reform that are lining up against it now. They said market forces would keep costs down, legislation could address issues such as access and restrictions on pre-existing conditions. They were wrong.

Don't let them defeat health insurance reform again. The group Small Business Majority projects that, without significant health care reform, the cost to small businesses of providing health care will double by 2018. But who will be able to afford that?

Right now we have the best chance of getting meaningful — sweeping — health care payment reform. As a small-business owner, you have a vested stake in making this happen.