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Small Business Optimistic About Group Health Insurance

As expected by most small business owners, it was the State of the Union. Not the state of healthcare reform.

The omission was not lost on those in Congress and in the industry who had worked tirelessly on a plan that all parties could agree on, only to have their work suddenly shredded in Massachusetts. It was a development the Obama Administration would rather forget than to open up yet another page in the brief history of health care reform in the United States. But a quick snapshot of small business owners reveals a rather unexpected glimmer of hope after Obama’s first State of the Union address last week.

Amidst the tax cuts, elimination of capital gains taxes on small biz investments and his admission that small business lending had dried up after banks he advocated bailing out put their hands in their pockets when approached by small business owners for loans to get by, Obama bid another small but healthy wink to this group.

“By the time I’m finished speaking tonight, more Americans will have lost their health insurance. Millions will lose it this year. Our deficit will grow. Premiums will go up. Patients will be denied the care they need. Small business owners will continue to drop coverage altogether.” He then declared, “I will not walk away from these Americans, and neither should the people in this chamber.”

That bit of verbiage came after he dropped the TARP bomb, proposing that some $30 billion in unspent money bailing out the banks be used to shore up small businesses in the form of further tax breaks for hiring more employees. After all, he surmised, the big corporate guys don’t deserve huge hand outs when they are the ones banks are lending to.

“Even though banks on Wall Street are lending again, they’re mostly lending to bigger companies,” said Obama. “Financing remains difficult for small business owners across the country, even those that are making a profit.”

Speculation abounds about how small business owners will be able to afford group health insurance for the employees they expect to hire if the TARP proposal sees the light of day. But some of the most vocal small business representatives are cautiously optimistic that at least some of the President’s proposals will trickle down enough to breathe a little life into their business.

Dawn Sweeny, president of the National Restaurant Association, thinks the Senate version of the healthcare reform bill — the one with the national health insurance exchange, which favors individual health insurance plans — is the only viable option for most restaurant owners (which represent the largest contingent of small business owners in the United States).

“It is essential to the restaurant industry that the protections added to the Senate version of this legislation be included in the Congress enacts any reform.”

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