Editore"s Note
Tilting at Windmills

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October 25, 2009

SMALL BUSINESS WITH A BIG PROBLEM.... It's almost as if insurers are trying to make the case for a public option more compelling.

As Congress nears votes on legislation that would overhaul the health care system, many small businesses say they are facing the steepest rise in insurance premiums they have seen in recent years.

Insurance brokers and benefits consultants say their small business clients are seeing premiums go up an average of about 15 percent for the coming year -- double the rate of last year's increases. That would mean an annual premium that was $4,500 per employee in 2008 and $4,800 this year would rise to $5,500 in 2010.

The higher premiums at least partly reflect the inexorable rise of medical costs, which is forcing Medicare to raise premiums, too. Health insurance bills are also rising for big employers, but because they have more negotiating clout, their increases are generally not as steep.

Higher medical costs aside, some experts say they think the insurance industry, under pressure from Wall Street, is raising premiums to get ahead of any legislative changes that might reduce their profits.

And while insurers are making things worse for small businesses, health care reform advocates are offering an alternative. As President Obama explained in his weekly address yesterday, "[O]ur health reform plan will allow small businesses to buy insurance for their employees through an insurance exchange, which may offer better coverage at lower costs -- and we'll provide tax credits for those that choose to do so."

One of the standard GOP talking points against reform insists that changing the system would punish small businesses. We already know that's wrong, but it's worth re-emphasizing the fact that it's the broken status quo that's crushing small businesses and entrepreneurship.

Steve Benen 8:00 AM Permalink | Trackbacks | Comments (11)

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Republicans, the new liberals, listening to "we the" teabag "people" and turning it's back on business.

Posted by: Dave on October 25, 2009 at 8:49 AM | PERMALINK

It would be nice if small business could buy into the public option that will be cheaper than the for profit insurers.

Posted by: cheflovesbeer on October 25, 2009 at 9:26 AM | PERMALINK

"We already know that's wrong, but it's worth re-emphasizing the fact"

Republicans wrong. Wake me when there right about anything.

Posted by: langs on October 25, 2009 at 9:31 AM | PERMALINK

In South Florida $4500/yr buys you a crap policy with extremely high deductable. More like $12000/yr and with increases of 15% now your talking +$13K/yr. I used to provide full health ins. to my employees. They now pay more and more of it each year. My small service business cannot be competitive in the market without the continually increasing ins. costs being passed on the the employee. After payroll, insurance is next biggest expense. Basically there is a sum of money representing an employees cost that I can afford. The more of it going to ins. means less of it going to payroll.

Posted by: Wayne on October 25, 2009 at 10:10 AM | PERMALINK

Do the Democratic leaders pushing the public option already know it is dead? YES: 7 No: 5.


Here is what another example of the Corporate Media still trying to frame/ deceive the American people. This one, of course, comes from Miss Piggy, aka Chris Matthews, 'show'. They just never stop .. As Ed Shultz said the other day on his show "many of the political commentators, i.e. pundits, have been bought off to deceive the American people'...then he wanted to 'name,names' but bit his tongue ....

Posted by: stormskies on October 25, 2009 at 10:28 AM | PERMALINK

it will be a fine day when small businesses and labor head to the castles of corporate power and congress with torches and pitchforks...

universal health care -- but for the depths of chaos wrought by the corporations with their bribes and propaganda -- could have been the issue.

obama could have been the leader...

Posted by: neill on October 25, 2009 at 11:35 AM | PERMALINK

So the possibility of health care reform causes Wall Street to forecast lower profits for insurance companies, which causes their stock to drop, so insurance companies raise their premiums ahead of any actual profit drop (they don't want to adversely impact executive bonuses, ya know). Of course, this impacts individuals and businesses, who then clamor for health care reform, the possibility of which causes Wall Street to forecast lower profits.... sheesh. Maybe national health care isn't such a bad idea after all.

"The Capitalists will sell us the rope with which we will hang them."
- Lenin

Posted by: josef on October 25, 2009 at 11:43 AM | PERMALINK

There's an interesting thought out there (uncitable, but I've heard whispers) that there is a de facto fifth column within the insurance industry that is deliberatly trying to sabotage efforts against health care reform. You know the senior people are opposed, but you haveto figure a decent chunk of middle management knows the score. How else to explain the obnoxiously bad behaviour of these companies as an industry recently? Senior management may think the fix is in, so they'll sign off on these things, but they originate from lower down the line, and people must know how bad it looks. CEOs set policy, not retail prices.

Posted by: Northzax on October 25, 2009 at 3:44 PM | PERMALINK

A likely consequence of the higher premiums is that more businesses will either drop insurance coverage completely or will scale back their coverage so that they can say they offer insurance but really leave everyone with paying increasing percentages of their health care costs. These premium increases don't only illustrate the need for a public option but the need for other aspects of health care reform as well.

Posted by: Ron Chusid on October 25, 2009 at 3:54 PM | PERMALINK

The bribery of Congress is the only thing standing in the way of what America needs most and what is least expensive...Single payer not for profit Health care ins like Medicare for all.

These profiteering ins/wall street price gouging useless groups should be eliminated from the helath ins business.
They are ruining Americans for pure greed.

We have the answers but bribery keeps them from implementation.

Posted by: bjobotts on October 25, 2009 at 5:13 PM | PERMALINK

Last year our long-time insurer raised our rates 22% for the 2009 year. At the same time our income fell off last year by 25%. We're a medical group. Where is all that money going?

Posted by: J Bean on October 25, 2009 at 7:42 PM | PERMALINK
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