Op Ed by Small Business Owner and Health Care for All PA Past-President Dave Steil in June, 2013
Better care at a lower cost
Health care, its delivery, quality, coverage and cost is the most perplexing and challenging issue facing the business community today. There is nothing more important to a business in the management of its operations than knowing the cost of each component of those operations.
When it comes to health care protection for employees, however, those costs are difficult to understand and to control, especially for small business owners who wear many hats and must deal with day to day challenges while still finding time to ensure that the long term plan is also in place. As a small business owner, my struggle to find a balance between those responsibilities is ever present.
Since World War II health care has principally fallen upon the shoulders of business. That means that it was discretionary for business owners to provide or not provide health care to employees. Frequently, that meant a hard working individual had to depend on the employer’s health care plan being a major beneficial component of the business cost and competitive structure. When the plan failed to be beneficial, the employer was free to drop employee health care. As costs rose and competitive conditions changed, many business owners did just that. Often it was imperative for the business to remain viable.
With the passage of the Affordable Care Act (ACA) in 2010, businesses are, for the first time, required to provide health care to their employees. Businesses smaller than 50 employees are exempt but their individual employees must now buy insurance to cover themselves and their families.The total impact of these changes to the health care system is not yet known to business owners, but are much feared.
More and more business owners are asking the question, why is health care still our responsibility? Why do we continue to perpetuate a seventy year old system that is costly and leaves many hard working people without health protection of any kind? Business owners know their products and services. They are not schooled in health care administration. But, if we accept that question then we must ask, if not business, then who?
There are in reality only two answers to that question. Either every person must provide for his or her own health care protection or it must become a core function of government, just as is education. In fact government already provides close to 50 percent of all health care, through Medicare, Medicaid, Military (including VA) and government employees.
Many will reject this option without ever looking at the facts. That is regrettable and intellectually dishonest. In fact, now there is now solid data to support the concept of a State of Pennsylvania managed health care system that would cover all Pennsylvania citizens for most health care related needs.
An economic impact study (EIS) just released by Health Care 4 All PA, a Pennsylvania non-profit corporation, clearly demonstrates that health care can be provided to all citizens at much lower cost than is already being paid by business and individuals. Known as the Pennsylvania Health Care Plan (PHCP), administered by the state, it would provide comprehensive health protection by removing the significant costs associated with insurance based and directed coverage. The cost of the plan would be paid for by personal income and payroll taxes, but at a lower rate than is already being paid for health services.
For businesses there are many added benefits directly reducing the costs of doing business:
- Lower direct costs than the cost of the insurance based system Reduced Workers Compensation costs
- Reduced cost of general liability insurance
- Elimination of costs to administer the insurance plan by the business
- Equal ability to compete for employees in the job market
- Increased ability to compete in the international marketplace
- Elimination of legacy costs for providing retiree health care
- Less confrontational collective bargaining
- Clear and identifiable costs for budgeting purposes
Legislation to adopt the PHCP presents an historic opportunity to overcome the complexities and uncertainty of the Affordable Care Act and to put Pennsylvania in the forefront of advanced and enlightened health care. Nothing else that we could accomplish would create a business climate as economically attractive as the PHCP.
This is not just a health care management plan, but a major job creation engine. If the business community rally’s behind this proposal it will happen, because we, collectively, carry a powerful voice.
David Steil, Lower Makefield, is a small business owner and a former member of the state House of Representatives.