Business Mandate Good For Business

As the health care debate heats up, it becomes clearer why most politicians flinch from tackling major reforms, and why it's so difficult to engage grassroots citizens to influence policy debates. The clear philosophical debate -- should our government provide a public insurance option? -- quickly splinters into a series of sub-debates. Is it fair to fund reform with limiting the tax exemption for employer benefits? [1] Is malpractice reform a reasonable concession [2] to the right-leaning American Medical Association? Should Congressional Budget Office estimates dictate our understanding [3] of the possible budgetary impact?

Such skirmishes are invariably complicated to understand, and don't spark the same kind of grassroots engagement that clear philosophical debates do. And without grassroots engagement, major reforms typically weaken under corporate lobby pressure.

The best way to mitigate these obstacles is, when possible, to anticipate them, get ahead of the curve, disseminate critical info that can resolve disputes before misinformation sparks a brush fire.

One potential brush fire that has yet to catch is: should all businesses, including small businesses, be required to either provide quality health coverage or contribute to support a public plan option?

Hear health care experts discuss an employer "play-or-pay" proposal and a reform statement endorsed by more than 300 leaders, including top economists.

Small businesses -- and more importantly, healthy mid-size businesses that regularly wrap themselves in the "small" business flag to better combat reasonable regulations -- will surely insist they can't handle a requirement to help provide health coverage without cutting jobs or going under. And conservative obstructionists will be right there to fuel their claims, no matter what the facts are.

But a new report [4] released today show that a requirement for all businesses to help provide coverage will not lead to significant job losses, and more likely will create jobs.

The new Institute for America's Future/Economic Policy Institute report by Phillip Cryan [4] found that only under an implausible worst-case scenario, including a steep burden on small businesses, would any job loss occur from requiring businesses to help cover employees. And even then, the losses would affect a mere 0.1% of workers.

More likely, once all impacts of health care reform are factored in -- new demand from health care services, increased productivity from better health, more efficient labor markets from health security, cost savings for businesses that choose contributing to the public plan, reduced health insurance costs throughout the system -- we'll enjoy a net increase in jobs.

Lessening the burden on vulnerable small business is still appropriate, but a broad exemption -- making it harder for our government to cover everyone -- is not necessary to protect jobs. A separate UC-Berkeley Labor Center report released today by Prof. Jacob Hacker and Ken Jacobs argues for a sliding scale based on payroll size [5] -- "a better measure of a firm’s capacity than number of employees" -- to determine fair contributions to the public plan: "employers would pay 1 percent on the first $250,000 of payroll, 4 percent on the next increment, and so on."

Getting the word out to politicians, reporters, bloggers, activists and local small businesses that we need not fear job losses from an employer mandate could blunt an expected from conservatives to stoke panic -- as well as give the Obama administration cover so it won't be compelled to capitulate to the business lobby. (The President told the AMA, "small businesses that can't afford it should receive an exemption," [6] but he hasn't defined what he considers to be "small" and what that exemption would be.)

Fortunately, with these new reports, we have the facts needed to make the case.