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Word from the White House: American Small Businesses Need Health Insurance Reform

Nobody is more imperiled by the disastrous trends of the status quo than our small business owners and workers.

It's no secret that institutions of all stripes focus their communications on certain messages day to day. We thought it would all be a little more open and transparent if we went ahead and published what our focus will be for the day, along with any related articles, documents, or reports.

Supporting report: "The Economic Effects of Health Care Reform on Small Businesses and Their Employees," Council of Economic Advisers, July 25, 2009

Talking Points: American Small Businesses Need Health Insurance Reform

The Health Care Status Quo is Untenable for American Small Businesses.

  • The same skyrocketing costs that are devastating family budgets and exploding our national deficit are also threatening the viability of American businesses.
  • The current health care system is especially untenable for small businesses and their employees.
  • Lacking the bargaining power of large firms, small businesses pay as much as 18 percent more for the same health insurance.
    • They are also at risk for the possibility that one of their workers will become seriously ill – which can dramatically increase their premiums in subsequent years.
  •  As a result, fewer and fewer small businesses are choosing to offer insurance to their employees.  And those that do offer coverage tend to have less generous policies and are less likely to offer a choice of plans.
    • Entrepreneurs and small business employees are nearly three times as likely to be uninsured as their counterparts are large firms.
  • And each year that goes by without reform, the disproportionate burden that our health care system places on small businesses is growing.

Health Insurance Reform will Spur Job Creation

  • Reform will reverse the disturbing trends in our current system and spur job creation in small businesses.
  • By creating a health insurance exchange, reform will give small businesses and their employees more affordable options.
  • Small firms that choose to offer health insurance to their employees will be eligible for tax credits.
    • And small businesses that don’t offer coverage will not be penalized.
  • Reform will also crack down on some of the insurance industry's worst practices.
    • They will no longer be able to arbitrarily penalize small businesses if one or more of their employees become seriously ill.
    • Nor will they be allowed to deny coverage to small businesses or their employees because of pre-existing conditions.
  • And because potential entrepreneurs will no longer be discouraged from pursuing the dreams due to a lack of affordable and reliable health insurance options, reform will also lead to the creation of more small businesses.
    • This is crucial given the economic downturn that began almost two years ago, as we know that small businesses and new startups are the drivers of job creation as the economy pulls out of recession.