Brooklyn's Progress
April/May 2007

BY TONIA SHAKESPEARE

We are a wealthy nation, yet 46 million Americans go without health insurance everyday. Small business owners are especially challenged. More than half of the country’s uninsured live in a household headed by a small business owner or someone working for a small company. So not only is the business owner uninsured, but so are his or her employees. And while the big corporations offer medical coverage, only 48 percent of the smallest firms do so. Clearly, one of the biggest challenges currently facing entrepreneurs is a lack of healthcare coverage.

But because so few available healthcare insurance options exist, many small employers simply do not offer coverage. For those who can afford it, because of limited competition and few options when it comes to price and coverage, they face the additional burden of weakened purchasing power and higher administrative costs. Small firms with very few employees also face the greatest difficulty in obtaining coverage. Insurers often charge higher rates for these smaller firms claiming that the potential risk for high-cost claims is greater, and as such, would reduce or eliminate their profits.

"The high cost of health care is a serious obstacle for small businesses that are trying to compete in the global marketplace," said Chairwoman Nydia Velázquez of the House Committee on Small Business. "We know small firms pay more per employee to provide health insurance than large firms and that many of our nation's main job creators simply cannot afford it. Meaningful reform that addresses these concerns is a necessity, and this committee will be working to find a solution to this ongoing crisis."

The House Committee is working toward making health care insurance more affordable and available to this nation's 26 million small businesses. Representatives of small businesses and the insurance industry convened in Washington, D.C. in March to explore possible solutions such as changing the tax treatment of health insurance, exploring reinsurance options, and expanding pooling options available to small businesses.

“An unnecessary burden falls on entrepreneurs when they are faced with high medical insurance costs. And small business owners, who make up the bulk of the Chamber's membership, are a major part of this healthcare crisis,” stated Mark Kessler, interim president, Brooklyn Chamber of Commerce. “Reform must take place if we are to provide them with affordable options for healthcare coverage so that they can remain competitive, and both they and their employees can be healthy.”