Talent touts insurance bill to help small businesses

A congressional proposal to help small businesses band together to buy insurance would take pressure off taxpayer-supported health-care programs, U.S. Sen Jim Talent said Monday.

In a news conference at the JCS Tel-Link offices in Cape Girardeau, Talent promoted his bill to create association health plans. Of the 44 million Americans without health insurance, Talent said, approximately 60 percent own or work for a small business.

"Small businesses cannot enjoy the economies of scale" available to large businesses, Talent said. "Almost everybody who has health insurance has it as part of a large pool."

Increasing the number of people with insurance could help control costs for taxpayers in programs like Medicaid and Medicare, Talent said. Medicaid covers people with incomes below the poverty level, including the working poor, who could drop the government program if their employers provided insurance.

The owner of JCS Tel-Link, Kathy Swan, is co-chairwoman of Talent's re-election campaign. But she said she's ready to support ideas from any source that would make it easier to provide health insurance to her 27 employees.

Two years ago, Swan said, she was forced to change health coverage so employees paid more of their own expenses in order to keep the insurance affordable.

Talent's bill makes sense, Swan said. "He really does understand the struggles that small businesses face."

Talent's bill has the support of the National Federation of Independent Businesses and the Missouri Chamber of Commerce. If the bill passed, those two associations, as well as numerous other similar business groups, would be able to offer members a chance to buy health insurance plans.

The option is available in some states but not in Missouri. The best way to provide what Talent termed "buying cooperatives" would be to establish national rules and national regulation of the policies, Talent said.

For businesses that already provide insurance, Talent said the savings could be 10 to 20 percent annually. "This would increase the clout of small business in the health care market."

Insurance premiums rose an average of 9 percent last year and have risen approximately 73 percent since 2000, Talent said. Costs have been especially difficult for small businesses, where health insurance prices are higher than for larger companies.

Talent's proposal has passed the U.S. House with bipartisan support but has stalled in the U.S. Senate, he said.

Making health insurance more affordable for small businesses is the top priority for the National Federation of Independent Businesses, said Brad Jones, the head of the Missouri chapter. While approximately 60 percent of the federation's members offer health insurance, he said, the number is decreasing each year.

Some individual states passed laws in the 1980s allowing purchasing associations such as that proposed by Talent, Jones said. "But they couldn't get to critical mass, and a lot of associations got stung pretty bad by the costs."

A nationwide program, Jones said, would allow large numbers of employers to band together, providing stability and cost savings to all.

As insurance costs increase, Jones said, many companies must balance a choice between dropping coverage or cutting employees.

The proposal recently enacted in Maryland to force Wal-Mart to increase spending on its own employees isn't the answer to controlling costs, Jones said. Maryland law now requires all employers with more than 10,000 employees to spend at least 8 percent of revenues on health insurance benefits.

That mandate could too easily be extended to all employers, he said, creating a potential squeeze on small businesses.