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This Summer, Health-Care Rhetoric is as Hot as the Weather
This summer the issue of health insurance has moved up on the Washington
policy agenda. Unfortunately, the people making the most noise are
for the ?solutions? most harmful to small business. It appears that
Washington's most prominent liberals are returning to their usual
rhetoric in an attempt to create a campaign issue for this fall's
If this is the case, we can only expect repeated calls for legislation
would devastate small business.
Since 1986, the cost of providing health insurance for employees has been
No. 1 problem faced by small businesses. Unlike large corporations, small
firms are unable to buy low-cost, quality health insurance in bulk.
Sen. Edward Kennedy (Mass.), one of small business's most ardent foes, has
proposed to solve the problem by mandating that America's businesses
health insurance by any means necessary. And not just any health
but health insurance as costly as that provided to government officials
In a speech before the National Press Club last month, Kennedy announced
he will introduce legislation mandating that all businesses with 100 or
employees provide this insurance, whether they can afford it or not. But
businesses with fewer than 100 employees can breathe no easier. Kennedy
to propose legislation later this year mandating that all businesses,
regardless of size or ability to pay, provide this insurance for their
Every small-business owner who must pay the bills knows what the results
this policy would be. The cost of each employee to the employer would
increase dramatically. Employers would be forced to reduce the number of
employees on the payroll just to keep the total payroll costs from
out of control.
Association Health Plans (AHPs) are the No. 1 health-care priority for
AHPs would allow small businesses the opportunity to band together across
state lines to purchase health care through a trade or professional
association. This would give small businesses and their employees the
economies of scale, purchasing clout and administrative cost savings that
their big business counterparts currently enjoy. In addition, AHPs would
the freedom to design more affordable benefit packages and offer workers
access to greater health-care coverage options.
As each political party in Washington spends the summer bashing the
dueling health-care plans, NFIB will work to add AHPs and other
entrepreneurial health-insurance solutions to any legislation that might
President Bush's desk.
Is the rising cost of health insurance for your employees causing you to
reconsider whether you can afford to provide these benefits? Tell us your
story. The real experiences of small-business owners are NFIB's most
weapon in the halls of Congress. E-mail us at email@example.com.
NFIB Study Shows Costs of Postage Hike
The cost of a stamp went up this week, and that rate hike will take a
billion-dollar bite out of the bottom line for small business. The rate
increase is also projected to cost jobs, especially in the retail sector.
a Washington, D.C. news conference this week, NFIB released its Regulatory
Impact Model (RIM) study on postal rate increases, which puts a price tag
the billions of dollars that the postal rate increase will cost small
The RIM projection is based on the results of the most recent NFIB
Small Business Poll, which gauged small-business owners' reactions to
rate hikes. The RIM study extrapolated the cost to small business of a
40-cent first-class stamp. The current rate increase is for 37 cents, but
another 3-cent increase is likely in 18 months.
For the full 40-cent stamp, plus announced increases in other postal
and services, the cost to small business would be $2.3 billion. The
to a 37-cent stamp alone will cost small business $1 billion.
On an individual basis, postal increases will directly cost the typical
small-business owner with 1-4 employees about $540 annually while owners
10-99 employees can expect to pay an additional $2,208 in postal costs.
(Based on projections for 40-cent stamps.)
By industry, these costs will fall disproportionately on service firms,
including the finance sector. About one-third of the direct costs will
upon the trade sector, including both wholesale trade and retail firms.
The postal increases will also impose modest job cuts on the economy, as
firms will be squeezed to pay the additional costs. Some owners will
reduce employee hours or forego raises. The RIM model indicates a
job loss of about 5,000 jobs, falling heavily on owners with 1-4
(Based on 40-cent stamps.)
Small-Business Owners to Meet Federal Regulators in Northern Illinois
NFIB/Illinois is helping small-business owners make their VOICE heard on
issue of federal regulations. U.S. Reps. Don Manzullo (16th Dist.-Ill.) -
chairman of the House Small Business Committee - and Phil Crane (8th
Dist.-Ill.) will join officials from key federal regulatory agencies at a
hearing on the government's efforts to comply with the Small Business
Regulatory Enforcement Fairness Act.
The hearing is on July 15 in Crystal Lake, Ill. If you are interested in
testifying at this hearing in northern Illinois, contact NFIB's Illinois
office at (217) 523-5471.
GRASSROOTS POWER: TIP OF THE WEEK
NFIB Grassroots Manual is Here
NFIB's 2002 VOICE Grassroots Manual is ready for delivery. This book
you everything you need to know about effective grassroots political
organization. Assembled by NFIB's political staff, the Grassroots Manual
valuable tool in learning how to effectively interact with candidates,
officials, and the news media. E-mail us at firstname.lastname@example.org to
your copy today! Please specify whether you would like to receive a hard
by mail (and include your address) or a PDF document by e-mail.