U.S. Rep. Jim Gerlach (R-6) joined lawmakers from both sides of the aisle on Tuesday calling for the adoption of a bill that would allow more small businesses to offer health insurance coverage to their workers.The Small Business Health Options Program Act (H.R. 6210) would allow small businesses to band together in statewide or nationwide pools to obtain lower health insurance premiums and would offer tax credits to employers who provide coverage to workers.
"This legislation would put healthcare coverage within reach for millions of self-employed and small-business owners who want to provide competitive benefits to attract the most talented and skilled workers, but often lack the resources to do so," Gerlach said. "With support for this bill coming from diverse groups such as the National Federation of Independent Business, the National Association of Realtors, and the Service Employees International Union, there's no reason Congress cannot work together to enact this bill."
The SHOP Act would make make insurance costs more predictable and coverage more accessible for about 47.1 million employees by:
Â€¢ Allowing small businesses and those who are self-employed to band together in a statewide or nationwide pool to obtain lower health insurance prices by spreading their risk over a larger number of participants than individual plans.
Â€¢ Keeping prices low by offering a range of private health plans that have to compete for business.
Â€¢ Providing small business owners with an annual tax credit of up to $1,000 per employee ($2,000 for family coverage) if they pay for 60% of their employees' premiums, and a bonus tax credit if they pay for more than 60% of the premiums. Self-employed individuals would get a $1,800 annual tax credit ($3,600 for family coverage) to purchase health insurance.
Â€¢ Cutting down on administrative costs for small businesses, which small employers spend almost 25 percent of health insurance premiums on administrative costs, compared to 10 percent for large employers.
Â€¢ Banning the practice of rating insurance based on health status and claims experience so that premium increases will be more stable and predictable.
Â€¢ Providing a Web site with comparative information about a variety of private health plans.
Â€¢ Putting in place accountability measures using existing structures like those use by state insurance commissioners to ensure that all health plans meet state requirements for financial solvency, network adequacy, and claims and appeal procedures.