Small Business Owners Say Cutting Health Care Costs, Need for Reform are Top Concerns

    • December 2, 2008

Making health care more affordable is a top concern of small business owners, saying health care cost is the primary issue confronting their businesses. More than one in three small business owners (36%) said that rising costs are likely to cause them to cut some portion of health insurance benefits for their employees, according to a survey released today by the Robert Wood Johnson Foundation. 

The survey, conducted jointly by Public Opinion Strategies and Lake Research Partners, surveyed 400 small business owners and executives of firms that have fewer than 50 employees and pay for some portion of their employees’ health benefits.   

Small business owners surveyed believe that health benefits are a powerful inducement to retain good employees, and said they struggle to keep up with unpredictable increases in the cost of offering insurance to their employees. They look to Congress and the new president to help address their concerns, with nearly half of small business owners (42%) saying ‘making health care more affordable’ is the idea Washington should address first.

“Many small business owners have already reduced their health benefits and asked employees to pay a larger share of the premium, and still they struggle with the ever-increasing costs,” said Risa Lavizzo-Mourey, M.D., M.B.A., president and CEO of the Robert Wood Johnson Foundation. “They want health care reform that reduces the burden on their business and where all Americans have affordable health insurance.”

While some differences exist among small business owners on preferred ‘fixes’ for America’s vexing health care problems, overall support for various policy options have strong support.

  • More than three in four small business owners surveyed (78%) said they would support a reform package that combines government-sponsored purchasing pools to allow small businesses to purchase insurance at negotiated bulk rates, along with tax credits to make offering insurance more affordable for small businesses. 
  • When asked if they would support a plan requiring employers with 10 or more employees who do not provide health coverage to pay four percent of their payroll to help cover the uninsured, a majority (53%) of those surveyed favored the proposal.
  • Two in three of those surveyed (68%) said they would support a market-based approach to provide employees with tax credits to purchase their own portable, private health insurance, as well as encourage the use of health savings accounts and include tort reform for medical liability lawsuits.
  • A smaller majority (53%) said they would support an approach requiring that at least one public plan and one private plan be offered to all employees, and also requiring insurance companies to provide coverage without regard to age or pre-existing conditions. The approach would be paid for by repealing tax cuts for Americans with annual incomes of $250,000 or more.
  • 40 percent of small business owners said they think a mandate requiring employers to offer insurance to their employees would hurt their business.

“There is no shortage of ideas about how we can significantly reform health care in America, and many people want to bring their perspectives to the table,” said Lavizzo-Mourey. “This survey shows how important reform is to small business owners across the nation, and how flexible they are willing to be in order to embrace reforms that finally bring them relief from staggering costs.”

The Robert Wood Johnson Foundation focuses on the pressing health and health care issues facing our country. As the nation's largest philanthropy devoted exclusively to improving the health and health care of all Americans, the Foundation works with a diverse group of organizations and individuals to identify solutions and achieve comprehensive, meaningful and timely change. For more than 35 years the Foundation has brought experience, commitment, and a rigorous, balanced approach to the problems that affect the health and health care of those it serves. When it comes to helping Americans lead healthier lives and get the care they need, the Foundation expects to make a difference in your lifetime.