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Commentary: Health bill could handicap small businesses

  • Story Highlights
  • John Boehner: Small businesses have provided jobs and benefits to many
  • He says Democratic plan for health care could eliminate jobs
  • He says small companies could opt to drop coverage for employees
  • Boehner: Republican plan would build on what works in health care
By John Boehner
Special to CNN
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Editor's note: Rep. John Boehner, a Republican from Ohio, is the House minority leader. For another view, read here

John Boehner says the Democratic plan for health care could cost small businesses heavily and eliminate jobs.

John Boehner says the Democratic plan for health care could cost small businesses heavily and eliminate jobs.

WASHINGTON (CNN) -- Before I was elected to Congress, I ran a small plastics packaging business in Cincinnati, Ohio, providing products and services, creating jobs and meeting payroll.

Thanks to the 1974 Employee Retirement Income Security Act (ERISA), which shields employers who offer benefits to their employees from being pummeled by laws that vary from state to state, I was also able to offer health care and pension benefits to my employees.

As every small-business owner knows, this can be quite a balancing act, but I count it as one of the most rewarding times of my life -- a time that led to my service in Congress.

Whenever I cast a major vote in the House, I find myself thinking back to those days and how the policies we are debating will affect small businesses like mine. After all, I first decided to run for elective office because government -- at all levels -- was too often an impediment to my firm's success.

With Blue Dog Democrats having announced a "deal" with congressional Democratic leaders to move forward on health care legislation after the August legislative break, I've again put myself back into the shoes of a small-business man.

Unfortunately, the Democratic chairmen of the three House committees that crafted the legislation don't have that same type of real-world experience. None of them have run a business before -- and looking at this legislation, it shows.

Rather than helping small businesses with common-sense solutions to make health care more affordable, the Democrats' bill actually creates a climate that destroys jobs and does nothing to slow the cost-shifting to businesses and employees that is one of the fundamental problems with health care in our country today.

At the heart of the Democrats' plan are an income tax surcharge that will fall heavily on entrepreneurs who run small businesses and a harsh mandate that requires employers to provide health care or face a penalty -- a mandate that could eviscerate ERISA by persuading employers to stop offering health care benefits to their employees.

After five years, the Democrats' legislation requires all employer-provided health care plans to be approved by the Department of Labor and a new health choices commissioner. Employers that do not provide a plan would be forced to pay an 8 percent payroll tax. Incredibly, employers could be slapped with this penalty even if an employee is offered quality health coverage and refuses it.

Because this tax is -- in most instances -- less costly than providing a health care plan, many employers will simply forgo employee health benefits. That's why a June 15, 2009, study by the Congressional Budget Office warns that Democratic legislation could force 15 million Americans who currently receive their health coverage through their employers -- not to mention 8 million Americans who receive health care from other sources -- onto the government rolls.

Republicans believe we can achieve real health care reform without destroying jobs and undermining ERISA. In the House, we've outlined a plan to strengthen the employer-provided health care system. Our proposal establishes small-business health plans, which allow smaller firms to band together through associations and purchase quality health care -- even across state lines -- at a more affordable cost.

It provides small businesses tax credits to defray the administrative costs of providing health coverage for their employees. It gives states incentives to reform their insurance markets so insurance companies are able to compete and increase employers' and employees' purchasing power. And it reins in junk lawsuits that lead to defensive medicine and higher premiums.

To expand access to quality care, our proposal includes tax credits so those who are uninsured can purchase plans that work for them. It promotes health savings accounts that give employees more control over their own health care decisions. And it ends the bias many insurance companies have shown against those with pre-existing conditions, while focusing on innovative preventive care and wellness programs.

The plan supported by Speaker Nancy Pelosi and other Democratic leaders rejects virtually all of these reforms and places blind faith in a massive new government bureaucracy that the Congressional Budget Office warns will drive health care costs -- not to mention the federal debt we'll pass along to future generations -- higher than ever. And it begins with the tax-and-mandate scheme that undermines the employer-provided health care system that has made it possible for small businesses like the one I used to run to provide health benefits for millions of our employees.

House Republicans have laid out common-sense solutions to confront the heart of our health care crisis: soaring costs being shifted onto businesses and employees at an unmanageable pace. On behalf of our nation's small businesses and the millions to whom they provide jobs and benefits, I hope the speaker reconsiders her "go-it-alone" approach.

When Congress returns to work in September, we need to build on what works in health care, rather than replacing it with a one-size-fits-all government-run system that will destroy jobs by squeezing payrolls and force millions of employers to stop offering health care benefits.

The opinions expressed in this commentary are solely those of John Boehner.

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