A small business owner's view of the health care proposal

Kelli Glasser fights an annual battle to provide health care to her Ohio firm's workers.

Every year, the price of health insurance rises. Every year, she has to trim benefits or increase out-of-pocket costs for employees so her firm, Exhibit Concepts, can continue offering a health plan.

This summer, details of health care reform legislation have brought her new worries. And, she fears, new potential costs for her business. Other small businesses are also calculating what Washington legislation would do to their bottom lines.

A key provision in the current House reform legislation would require businesses to provide insurance to their workers or pay a penalty to the government. Some small firms – though probably not Glasser's -- would be exempted.

The National Federation of Independent Business, a trade group for small businesses, has strongly opposed this employer mandate, saying it will cost jobs. The U.S. Chamber of Commerce also opposes it. The Senate Finance Committee, meanwhile, is working on a compromise provision that could be more palatable to businesses.

Health care is an especially thorny problem for small firms. They pay on average of 18 percent more than larger companies for similar benefits plans, according to the NFIB. The price tag of insurance is a major reason why far fewer small businesses offer coverage than larger businesses.

GlasserExhibit Concepts, which designs, builds and manages exhibits for trade shows and museums, provided free health benefits to employees for many years. Then, about 10 years ago, the cost of benefits began spiking every year.

Workers began paying part of the insurance premium. Glasser also raised co-pays for doctor visits, from $10 to $20 to $25. "Every year, to continue to offer health care, we've basically changed our plan,'' says Glasser, 39, an NFIB member and president of the Vandalia, Ohio, company.

Exhibit Concepts has 87 employees, and 70 of them participate in its health plan. But the last six months have been rough financially for Exhibit Concepts. Revenues have dropped, and the company was forced to lay off 20 employees.

Glasser has switched to a health plan that has a $5,000 deductible for an individual. That amount worries people like Dr. Scott Nelson, a Mississippi family doctor, who in a Dollars & Health column said a deductible that high can prevent patients from getting needed care, because it's all out-of-pocket.

Exhibit Concepts, though, does reimburse employees for half of their medical expenses incurred under the deductible. A high deductible plan is a necessity in these economic times, Glasser says. "Philosophically, we figure out what we need to do for our business to survive,'' she says.

She is concerned that health reform legislation would establish a minimum level of coverage for employees. If her benefit plan doesn't qualify for that level, it could cost her another $150,000 to $250,000, she estimates. "Right now, I can't imagine where I'd come up with that without cutting jobs. I'd consider it a last resort. Sometimes you have to go to the last resort.''

Glasser isn't opposed to all reform. She says the health care system has many flaws. Too much waste, not enough competition among health insurers for companies' business. "Reform is necessary,'' she says, ''but we need to bring the costs down.''

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