Businesses weigh in on health reform
Keith Chu, The Bend Bulletin
January 4, 2010
WASHINGTON — Many of Central Oregon’s major businesses — and their employees — wouldn’t see much effect from the health reform legislation moving through the U.S. Congress, they told The Bulletin this week, in an unscientific survey.
The larger employers — including Sunriver Resort, Bright Wood Corp. and Cascade Healthcare Community — already offer health insurance to full-time employees, they said. But at least some smaller employers said they’re disappointed the U.S. Senate reform proposal won’t provide relief for their overbearing insurance costs.
Deschutes Brewery CEO Gary Fish laughed when asked whether he had read the health care reform bill, or started planning for its impact. His company, with about 150 employees in Central Oregon, already offers insurance to full-time workers, Fish said.
“I haven’t read a book that long in a long time,” Fish said, of the more than 2,000-page bill. “There’s not a lot of planning I feel that you can do at this point in time, because it’s really hard to tell what it’s going to be.”
The U.S. Senate and House next month will begin combining two versions of health care legislation that passed each chamber in recent months.
The Senate bill would expand coverage by making more people eligible for Medicaid and providing subsidies for low-income families to buy insurance. It would more strictly regulate insurance companies and ban insurers from rejecting customers who have pre-existing conditions. It would also require most in the U.S. to buy health insurance, cut more than $480 billion in waste and services from Medicare and tax expensive insurance plans.
The House bill has a similar overall design, but differs in many of the details. Maybe the highest-profile difference is the inclusion of a public insurance option — prized by liberals as a government competitor for private insurers — which moderate Senate Democrats have vowed will not become law.
Details may change
Dallas Stovall, president of Madras-based Bright Wood Corp., said it’s too soon for him to begin planning for the impact of health reform.
With four years until most of the Senate bill’s provisions go into effect, there’s plenty of time for the details to change. Bright Wood, which has about 650 employees, offers insurance to all full-time workers, Stovall said.
“The problem is nobody knows what’s happening,” Stovall said. “Whatever’s in that bill won’t be the same in three or four years when they implement it.”
The Senate bill requires companies with more than 50 employees to provide insurance for their workers or pay a $750 fine per employee each year.
Both Stovall and Fish said they don’t anticipate much effect on their companies, since they already offer health coverage to full-time workers. At Deschutes, benefits vary depending on an employee’s job.
“I don’t think it’s going to change significantly our lives. If it does, you’ve got to change prices to correct for it,” Fish said. “If it’s cheaper to pay the penalty than provide the benefit, you’ll pay the penalty.”
Limiting costs
As head of a company that has seen health care costs increase an average of 14 percent annually for the past eight years, Fish said he hoped the bill would do more to limit the growth of insurance costs.
“Based on everything that I’ve read, it’s hard for me to understand how it benefits small businesses at all,” Fish said. “Right now, all I see is a bunch of payoffs to a bunch of special interests.”
Rhonda Ealy, co-owner of the Strictly Organic coffee shops in Bend, said she’s been disappointed by the Senate’s health bill. Ealy, who attended a briefing at the White House on health care reform, said it appears the bill will fall short of her expectations. Strictly Organic offers insurance to its 27 employees,
“I think it’s going to help individuals a lot more than it’s going to help small businesses,” Ealy said. “They’re not really helping me at all.”
Small businesses with fewer than 50 employees will be able to buy insurance through government-sponsored markets, called exchanges, which some analysts have said could lower insurance costs. But Ealy had hoped for a public insurance option to directly compete with private insurance.
Tom O’Shea, the managing director for Sunriver Resort, said he’s pleased that both versions of the reform bill increase the age that young adults can stay on their parents’ insurance, to 26 in the Senate bill and 27 in the U.S. House bill. Many seasonal resort workers arrive just out of college and end up uninsured, he said.
In many cases, “when someone graduates from college and they can no longer be claimed on parents’ insurance, they immediately lose their benefits,” O’Shea said. “That is one that would help.”
Otherwise, for the resort’s 450 or so year-round employees, the legislation likely wouldn’t do much, he said.
“We offer a full benefit package: vision, dental, medical, it’s a comprehensive deal,” O’Shea said.
Cascade Healthcare Community, parent company of the hospitals in Bend, Redmond and Prineville, plans to closely analyze the health care legislation once the House and Senate produce a combined bill, said CEO Jim Diegel.
As of now, CHC, like the Or-egon Association of Hospitals and Health Systems, is expressing “qualified support of the Senate bill and uncertainty about the House Bill,” Diegel said.
“One thing for sure is that reimbursement will be decreased, on average, in order to pay for the expansion of coverage and the numerous other aspects of the bill,” Diegel said, in an e-mail. How much, and for what services, though, is still up in the air.
Like many health care experts, Diegel said both bills do well at expanding insurance, but they seem likely to do little to slow the rapid increase in health care costs.
“I am not really sure what is unfolding is health care reform,” Diegel said. “Rather, it appears to be more insurance (and) payment reform or modification, with a noble attempt to expand access and coverage to more Americans.”
Central Oregon’s building industry was one group that didn’t hesitate to slam the Senate bill. The biggest reason: Construction contractors with more than five employees will be required to provide insurance for workers, or else pay a $750 fine for each employee, under the Senate reform bill.
Merkley amendment
Other companies with fewer than 50 employees wouldn’t have to provide insurance for workers, but U.S. Sen. Jeff Merkley, D-Ore., inserted an amendment in the bill to lower the limit to five workers for construction firms only. Merkley said he was asked by contractors who do provide those benefits to include the amendment, so they wouldn’t be at a disadvantage to other firms.
Tim Knopp, vice president of the Central Oregon Builders Association, said that provision is a direct attack on the small firms in his association. He blamed unions for pressuring Merkley to include it.
“There’s no question Senator Merkley’s payoff to the public employees unions, to damage small-business owners who just happen to be contractors, is an outrage,” Knopp said. “If you try to apply it to other industries that have small employee numbers, it doesn’t make any sense either.”
Knopp said the bill would add costs to an industry that — especially in Central Oregon — faces more difficult years ahead.
If it’s cheaper for a company to pay the fine than to provide insurance, many companies will be forced to take the cheaper route, he said.
“If it is more profitable for a CEO to pay the $750 fine for each employee than to insure them, that CEO is going to be hard-pressed to provide health insurance,” Knopp said.
Keith Chu can be reached at 202-662-7456 202-662-7456 or at kchu@bendbulletin.com.
Link to the story: http://www.bendbulletin.com/apps/pbcs.dll/article?AID=/20100104/FEAT03/1040357
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