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Small Business Health Care Survey Points to Need for Reform

WARREN, Mich., March 27 /PRNewswire/ -- While rising health care costs are an ongoing concern for all businesses, a recent survey of members by the Michigan Business and Professional Association (MBPA), and its sister association the Michigan Food and Beverage Association (MFBA), confirms that the small business community in particular is struggling to maintain health care coverage for employees.

"A number of businesses in Michigan are struggling with the expense of health care, and many are downgrading benefits or asking their employees to contribute more as a result," commented Ed Deeb, president of Michigan Business and Professional Association and the Michigan Food and Beverage Association, which jointly represent over 20,000 business members that employ more than 160,000 individuals throughout Michigan.

Deeb continued: "When reductions in benefits and enhanced cost-sharing is not enough to solve cost pressures, one response is to not offer coverage at all. Michigan needs to reform its individual health insurance market so that people in these situations can find affordable coverage and keep it long-term, rather than joining the ranks of the uninsured. The best reforms have already been implemented in other states. These include a high-risk pool to stabilize the market financially and cover people with severe conditions, and rate bands to provide for price stability."

The member survey revealed the following:

-- 28 percent of the respondent businesses have considered cancelling

their health care benefits within the past year.

-- Of that 28 percent, more than half (58 percent) stated that their

business is struggling. The rest of the respondents said increases in

taxes and economic factors have forced them to review their health care


-- 38.9 percent of those surveyed changed their health care coverage in

the past year to reduce premium cost.

-- 6 percent cancelled their coverage altogether, providing no additional

income to employees to help them fund coverage on their own.

Rising health care costs have driven up health insurance premiums rapidly over the recent past, growing a cumulative 78 percent between 2001 and 2007 and far outpacing cumulative wage growth of 19 percent over the same period, according to the Kaiser Family Foundation's Health Benefits 2007 Annual Survey.

The Associations' survey results show that more small businesses will likely rely on affordable individual health care coverage for its employees in the future.

"Times are changing in Michigan, and we must do what we can to help our business community and its citizens who deserve affordable health care," Deeb concluded.



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SOURCE Michigan Business and Professional Association
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