Small Business: Health care tols help small businesses compete for employees

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Sam Jones is the Region VII SBA Administrator.|ret||ret||tab|

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The U.S. Small Business Administration knows that affordable ways to provide health care coverage for employees of small businesses, and for themselves, is very high on the agenda as a small business owner's concern for their future business health. |ret||ret||tab|

We learned this as Administrator Hector V. Barreto conducted 11 roundtables with small-business owners in the last year across the United States. Health care coverage ranked as the No. 2 concern, and for good reason. Small-business owners invest time and money training employees, only to have them leave for better health care benefits at a large company. This is no trivial matter if you're trying to run a business. National polls indicate small businesses really do want to provide health coverage; not only for themselves, but for their employees.|ret||ret||tab|

That said, I want to talk about two provisions one that became law when Medicare was reformed last year, and one that passed the U.S. House of Representatives in June 2003 and has been referred to the U.S. Senate.|ret||ret||tab|

The first are Health Savings Accounts. These may be set up for your small business by the business or outside entities that sell the service. They are designed to be used in tandem with higher-deductible health plans, resulting in dramatic premium savings and making them easier for small businesses to purchase.|ret||ret||tab|

An HSA is basically a tax-free savings account, similar to an IRA, and is employee controlled. It can be used for routine medical expenses beyond a high-deductible policy. It is portable, designed to move with the worker. Individuals, their employers, or both, can contribute funds to the account. HSAs, as pre-tax dollars, are estimated to save their owners the employees 10 to 35 percent on out-of-pocket health care expenses; furthermore, participants can spend money on health care services when they want even into their retirement years.|ret||ret||tab|

Association Health Plans, pending in Congress, would allow small businesses to band together through trade and professional associations to purchase affordable health packages as groups. The groups would be able to take advantage of the economies of scale, bargaining power and administrative efficiencies all of which reduce the cost of carrying a health plan within a company.|ret||ret||tab|

The Senate has yet to act on the House-passed AHP legislation, which complies with the other federal laws prohibiting the group plans from excluding high-risk individuals or employers with high claims expenses and whose carriers would be certified by the U.S. Department of Labor as meeting their health care provider standards.|ret||ret||tab|

Both health care tools offer the small business owner a chance to compete for the best employees as a responsible employer and also to cover their own family health costs.|ret||ret||tab|

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