NEW HAMPSHIRE businesses, including those in the restaurant industry, have suffered as a result of the unpredictable and ever-increasing health insurance premiums we face each year. To make matters worse, companies also face paying almost $500 per employee (plus dependents) extra in premium hikes as a result of the health insurance tax (HIT) enacted by Congress years ago.
The good news is this tax has been suspended in the past, with the exception of this past year, but without Congressional action this tax will be back again in 2020.
Fortunately, Sen. Jeanne Shaheen has proposed legislation to keep the health insurance tax suspended for two additional years. Her goal is to help stabilize health plan premiums for small businesses, as well as individual insurance consumers and senior citizens on Medicare Advantage. All three groups are affected.
The high cost of the health insurance tax makes this legislation a key priority. Our company alone will shell out close to $100,000 more in 2020 unless Sen. Shaheen’s bill passes. Needless to say, if this tax is allowed to be implemented there will be less money available for businesses to hire new employees, provide raises, offer comprehensive health care packages, invest in new equipment, or even support charitable causes we’ve assisted in the past.
This undermines my goals as a business owner. Not only do I want to reward my employees with the quality health insurance they deserve, I want to offer our customers a memorable dining experience at a reasonable price. Skyrocketing health insurance costs already make this increasingly difficult and factors like the health insurance tax will only make matters worse.
The health insurance tax presents an especially challenging situation for hospitality entrepreneurs. We continually struggle to get quotes, let alone affordable pricing, from the insurance industry. Part of the problem is a shifting workforce, but making good insurance less accessible will only compound the issue. Establishments like ours need to attract and retain motivated professionals in order to provide an exceptional dining experience with quality customer service.
Sen. Shaheen’s proposal, which she’s co-sponsored with both Republicans and Democrats, should garner widespread support.
From an economic perspective, the health insurance tax has never made sense. Whether businesses absorb the nearly $500 per employee hit or ask workers to contribute more out of their paychecks, the tax will strip $55 million per year from New Hampshire to send to Washington, D.C.
The cutbacks many small business owners are now contemplating will put downward pressure on growth, sadly just as working families are beginning to feel the positive effects of a more robust recovery.
Given the many groups who stand to benefit, providing health insurance tax relief makes good economic sense.
With bipartisan support in place, even a divided Congress should be able to enact a solution like Shaheen’s proposal without delay.
Perhaps if elected leaders can achieve this success, the spirit of cooperation that emerges will spur them to find additional points of agreement for addressing the high cost of health insurance so that health care becomes truly affordable for all.