Health insurance costs highest for area?s smaller businesses

Gordon Kinne's recent article on controlling health insurance costs does not apply to most small businesses. Kinne projected 50 percent cost increases over the next five years. That low figure may only apply to large companies and large agencies who can avoid many mandates and self insure.

Small businesses, who are not eligible for ERISA exemptions and are prohibited from banding together in association health plans (AHPs) to take advantage of such economies of scale and to spread risks, suffer much larger cost increases. My own business has been hammered by health insurance premium increases ranging from 18 percent to 40 percent per year.

The result has been a tripling of health insurance costs over the past three years. I would be delighted with only a 50 percent increase over five years, even though that is still higher than the inflation rate.

During a recent Missouri State Senate hearing, I heard insurance agents de-scribe how many companies have no choice but to shift these rising costs to their employees. During my testimony, I stated that the customer really pays for the higher health care costs in the form of higher prices.

The employee's revenue source to pay higher copays is the paycheck earned from the company. The company either pays enough to cover the increased costs, or some employees will go elsewhere.

Many people have asked me what should be done to stop the rising cost of health insurance. I have only three suggestions.

1. Stop passing health insurance mandates. Every mandated coverage, no matter how meritorious, increases the cost of health care and increases the number of uninsured Americans.

2. Stop discriminating against small businesses. Small businesses are prevented from seeking ERISA exemptions or from grouping together to seek better rates.

3. I don't believe we will solve the health insurance costs till we break the tie between health insurance and the workplace. We don't get auto, home, life, or boat insurance at work. Why health care? Tax credits for insurance premiums could ease the transition.

Yours for a Better and Smaller Gov-ernment,

Scott George

general manager, Mid-America Dental & Hearing Center, Mt. Vernon