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Home>Lead Articles>Health Care Reform – Some thoughts

Health Care Reform – Some thoughts

Posted on September 9, 2009 by Lola Kakes

What’s a small company to do if required to offer health insurance? This is a question many small business owners are facing. The federal government is gearing up to tell the American business owner:

  • When or how to form a union
  • When to provide paid sick leave
  • When to provide paid family medical leave and
  • When to provide health care benefits

All of these issues are important – not only to the business owner but to the employees that they hire. There are really three perspectives that we need to look at:

  1. The HR Perspective
  2. The Business Perspective
  3. The Government Perspective

The HR perspective is that in order to attract and retain quality employees, quality benefits need to be available. These benefits could include paid sick leave and/or paid leave for medical reasons, and especially health benefits – usually for employee and sometimes for employee and family. The unionization of a company may become easier if the card-check provision of the Employee Free Choice Act passes. With only 7% of private business employees belonging to a union, the issues at stake are very high. From an HR perspective, many organizations might face new forms of HR issues that they have not had to deal with in the past, such as labor negotiations.

The Business Perspective, especially for the small to mid-sized business, is one of focus and cost. Most small businesses want to be able to provide the incentives that attract quality employees. However, if they are forced to comply, many small businesses may have no other choice than to close the door. Being forced to accept a union under the proposed law would require a business to seek labor specialists to help in the establishing of a union. That might force an employer to stop thinking about the day to day business issues and to focus on labor laws instead. Negotiation can be expensive and that is another nail that small business owners cannot afford.

Small businesses, who are forced to pay sick leave or medical leave, or provide health care benefits, may find the cost of doing business too great. It may not be that they don’t want to provide better benefits – they just might not be able to afford them. Or, if they are forced to provide these benefits, they will most likely be forced to raise their prices, which will impact the public as well.

The Government Perspective seems to be a very altruistic thought process. If only 7% of the private sector is currently unionized, what makes the government think the other 93% wishes to be unionized? Have they done a focus group? Have they surveyed those businesses? Or are they listening to lobbyist who are encouraging them to act? I doubt if many of the Senators and probably just a few of the Representatives, have every been a business owner. The cost of doing business runs from not providing benefits and paying for it by not being able to attract “star” players, to providing benefits at a cost of approximately 40% of the salary of the employees. If a business has a salary total of $100,000, the cost of benefits may reach $40,000.

Many individuals believe that health care is their right. It is not a covered issue in the Constitution. It is however, a privilege, just as voting is a privilege. Most employers want to provide and promote that privilege, but I do not believe we should mandate that privilege, especially when it may cost a business their opportunity to succeed.

We can put a man on the moon and do many other wonderful things, so surely we should be able to fix this problem. The bottom line is that businesses know what they can afford (both from a cost standpoint to the HR issue) and it should be left to them to fix their own problem. If they can provide some sort of paid health benefit they stand a better chance of attracting good employees, which in turn will help them grow their business. If they can’t, they may have to pay the piper and either stagnate or close the door. Either way, it should be their choice.

Related articles 1

  • Health Care Plan Could Undermine Small Business (myventurepad.com)
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