Good for (small) business

Nov 4, 2009 at 6:00 am

John Timmons doesn’t provide health insurance to his employees. Never has.

It’s not that the owner of ear X-tacy, the vaunted indie record store and Highlands fixture since 1985, doesn’t want to. Timmons and his wife, a physician, are both activists for single-payer health care.

But as it is now, Timmons can’t afford to offer insurance to his employees.

“It’s a shame, but we’ve just never really been able to afford it,” he says. “Back in the day when I thought we could afford it, if I bought into it then, the way that insurance costs have skyrocketed, we would’ve been gone before now.”

Costs for employers who provide health insurance have risen 119 percent since 1999, according to a figure cited in a new book called “Howard Dean’s Prescription for Real Health Care Reform,” by Vermont’s good doctor of Democratic politics. In his book, Dean offers the virtues of a health care reform plan similar to H.R. 3962, the Affordable Health Care for America Act, which will soon be the subject of a floor debate in the House.

The Democratic bill wouldn’t change much for Timmons as a businessperson; because his payroll falls below $500,000 a year, he would not be subject to a requirement for employers to offer coverage, nor would he have to pay the 8 percent payroll contribution for not offering insurance to workers. But the bill would require everyone to have insurance, and to that end establish a government-run public insurance option, which means Timmons’s employees wouldn’t have to look for a job that offers benefits if they suddenly needed it.

According to U.S. Rep. John Yarmuth, D-Ky., there are about 100,000 people in Louisville Metro without health insurance, and many of them work for small shops like ear X-tacy. While a mandate will hit some people harder in the wallet than others, it seems time for everybody to pony up a little to get a lot more than what we’re getting now out of our health care industry.

“It’s the notion of shared responsibility,” Yarmuth says. “We’re trying to make sure that all (small-business) employees have coverage.”

According to 2007 Census figures provided by Greater Louisville Inc., the Metro chamber of commerce, there are 19,357 businesses in Louisville with 99 or fewer employees; of those, some 16,000 would qualify for the payroll exemption, according to Yarmuth.

Jennifer Rubenstein of the Louisville Independent Business Alliance says most of the group’s 230 members have one or two storefronts; she estimates the majority would also qualify for the federal payroll exemption.

Nationally, 86 percent of small businesses would be exempt from the mandate and the penalty, according to figures provided by the House Committee on Ways and Means, which produced the bill.

The legislation has the support of small-business groups like the Main Street Alliance, which delivered a letter of support to the committee on Monday.

Still, there are opponents, including the Kentucky chapter of the National Federation of Independent Businesses and the U.S. Chamber of Commerce, both of whom seem hung up on ideology rather than the practical effects of health care reform. They tend to withhold from their counter-arguments essential points, such as the exemptions for small businesses and the fact that the public option would be paid for with premiums, not new taxes.

“They don’t address the concerns we have about affordability,” says Tom Underwood, state director of the NFIB. “The bills are all about creating a new health care system essentially with the public option.”

I told Underwood the public option — taken with the exemptions — seems to help the vast majority of small businesses, but he wouldn’t budge. Most people won’t at this point.

But not everyone. A couple months ago, Yarmuth held a meeting with 20 or so small-business owners, most of whom were “curious, anxious and apprehensive” about reform, he says. By the time they left, all but three or four agreed they’d benefit from the changes.

“I think the vast majority of people who hear about this and take the time to walk through it think it would be good for them,” Yarmuth says.

Howard Dean will interview Nobel Laureate in Medicine and author Dr. Harold Varmus at the Kentucky Author Forum Thursday, Nov. 12, at the Kentucky Center. Call 584-7777 or visit for details.