President Obama appealed Thursday to small businesses to support congressional legislation on health-insurance reform, saying it will revive America’s entrepreneurial spirit slowed by the high costs of coverage for owners and their employees.
“We all know that family premiums have skyrocketed more than 130 percent over the past decade,” the president said from the White House. “But small businesses have been hit harder than most… . in part because small businesses pay higher administrative costs than large ones, your employees pay up to 18 percent more in premiums for the very same health insurance policies.”
Mr. Obama said the House and Senate bills will reduce insurance costs for small businesses, protect them against unfair rate hikes and make coverage affordable to company employees.
The key points of the legislation for small-business owners, he said, include tax credits on insurance premiums and the possibility for owners to band together so they can increase their bargaining power with insurers.
Mr. Obama said the tax credit on the premiums could reach 50 percent and the exchange program could save small businesses 25 percent on premiums by 2016.
“That will mean its not just you bargaining with insurance companies, its you and many others,” he said. “With all that additional leverage, youll be able to get better deals than you ever could have received on your own.”
However, roughly 10 percent of businesses that do not offer their workers coverage may be required to contribute to the costs, the president said.
Mr. Obama delivered his remarks minutes after the House announced its version of health-reform legislation.
“I want to commend Speaker Nancy Pelosi and the Democratic Caucus for their leadership in achieving this critical milestone,” he said. “There is no doubt that this legislation and the legislation thats now being drafted in the Senate would benefit millions of small businesses.”
As he did last week at a small business in suburban Washington, the president recited a list of facts to prove how much U.S. entrepreneurship is in jeopardy.
Over the past decade and a half, small businesses have created 65 percent of all new jobs in the United States. However, that sector of the economy, from the middle of 2007 through the end of 2008, lost 2.4 million jobs, he said.
In addition, the related credit crisis has resulted in banks cutting back on lending to small businesses that are trying to grow or just meet payroll, the president said.
“The bottom line is that too many Americans like you cant afford to build the kinds of businesses youd been hoping to build,” Mr. Obama said. “And too many budding entrepreneurs cant afford to take a gamble on a smart idea because they cant give up the health insurance they get in their current job. Thats bad for our economy, its bad for our country, and its what well change when health insurance reform becomes law.”