Employer Mandate, Public Insurance Option Decried

By Staff Report

Jun. 4, 2009

Several proposals lawmakers are considering to reform the health care system could hurt small businesses, witnesses testified before the House Committee on Small Business.

Many in Congress are insisting upon the creation of a mandate that would require employers to sponsor insurance coverage for employees.

“The idea that an employer mandate will increase coverage is illusory, because new rules will not change financial realities for small businesses,” said James Wordsworth, an owner of several small businesses who testified on behalf of the U.S. Chamber of Commerce.

Health care coverage costs for entrepreneurs are 74 percent higher than in 2001, said Rep. Nydia Velazquez, D-New York, who chairs the House small business panel and is co-sponsor of a bill that aims to rein in health care expenses for small businesses.

John Nicholson, another small-business owner who testified on behalf of the National Federation of Independent Business, agreed that mandates would adversely affect small employers by raising payroll costs, eroding competitive positions and increasing startup costs.

He and other witnesses also denounced a public health insurance option.

When considering policies that would expand the government’s role in health care, “Ask yourself: Do you want a program that has the responsiveness of the U.S. Postal Service, the heart of the IRS and the cost inefficiency of the Pentagon?” Nicholson asked.

Filed by Jennifer Lubell of Modern Healthcare, a sister publication of Workforce Management. To comment, e-mail

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