Trade group says Blunt health plan not enough

Reaction to Gov. Matt Blunt's health-care proposals run full spectrum -- pans from Democrats and groups advocating for a more aggressive approach to praise from businesses that stand to benefit from the new tax deductions the proposal provides.

One business group, however, isn't impressed with Blunt's ideas for promoting employer-sponsored coverage. The Missouri Restaurant Association, while applauding the effort, said most of what Blunt proposes isn't enough to help small, independent businesses pay for employee health benefits.

"The governor's proposal is a step in the right direction," said Pat Bergauer, executive director of the Missouri Restaurant Association. "Tax breaks are a wonderful thing, but tax breaks don't work for everybody. If you can't afford the premium, the tax break isn't going to do you much good."

Health care was the central theme Wednesday for Blunt's State of the State speech. The Republican governor had two themes -- overhauling the state's Medicaid program on one hand and pursuing incentives for business to provide health insurance on the other. According the Missouri Foundation for Health, about 700,000 Missourians lack health insurance.

Advocacy groups and Democrats are focusing on what they see as shortfalls in the Medicaid proposal. During Blunt's first year in office, he pushed lawmakers to impose limits on Medicaid eligibility that bumped an estimated 175,000 people off the taxpayer-supported health-care program. The new program, Blunt said Wednesday, will get a new name -- MO Healthnet -- and a new focus, giving users more care based on prevention and wellness.

"My Healthnet proposal expands choice and empowers participants," Blunt said.

But for critics, the key problem with Blunt's plan is that it does not expand the number of participants. The 2005 cuts took an estimated 70,000 children out of the program and limited eligibility for adults to those making 23 percent of the federal poverty level, a move that forced about 2,100 disabled people working at sheltered workshops to stop working to keep their coverage.

Medicaid enrollment peaked during the state's 2005 fiscal year at about 990,000 people, and close to 60 percent of those enrolled were children, according to the legislature's Medicaid Reform Commission report. But that report noted that almost two-thirds of the $5.6 billion spent on the program that year was spent caring for the elderly and disabled.

During a St. Louis stop to promote the plan Thursday, Blunt said his proposal will add taxpayer-supported coverage for about 10,000 people. Of those, most would be foster children ages 18 to 21 who were covered prior to the cuts, the St. Louis Post-Disptach reported, while only a few thousand people cut in 2005 will be returned to the program.

Criticism from Democrats focused on the Medicaid proposal. "Gov. Blunt's failure to restore the health-care cuts he made is leading Missouri in the wrong direction," Democratic Party spokesman Jack Cardetti said.

Blunt's proposal, however, includes $60 million to pay for expansions at Federally Qualified Health Centers, clinics that take patients regardless of whether they have coverage.

And he's including incentives for businesses to provide coverage. For example, Blunt is proposing to eliminate the corporate franchise tax -- which businesses pay based on their total assets -- for companies that provide health insurance.

Other points of Blunt's plan for private insurance incentives include proposals to allow Missourians to take their insurance with them when they switch jobs, pool the purchasing power of the uninsured and let businesses and employees take a deduction for insurance premiums on their state income tax.

The corporate franchise tax has been targeted by the Missouri Chamber of Commerce and Industry for years. The business group considers it double taxation. Under Blunt's proposal, 87 percent of companies currently paying the tax would see it eliminated, saving the companies about $14 million.

'A laudable goal'

The franchise tax break, along with deductions for premiums, "is a very substantive attempt to encourage the private market to work insuring Missourians," said Daniel Mehan, president and CEO of the state chamber. "That is a laudable goal."

Only businesses with more than $1 million in assets pay the franchise tax.

For one Cape Girardeau restaurant owner, that means the tax break won't do anything to help him find a way to provide insurance for his employees. "Doc" Cain of Port Cape Girardeau said he has about 30 employees but can't afford to offer health insurance.

"It is wonderful that the governor is looking at the health-care situation," Cain said. "But I am not sure it is going to be any benefit to a business such as myself to offer health coverage. It is just not enough of an incentive that we can afford it."

rkeller@semissourian.com

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