Kerry Health Care Plan Eases Cost Burden for Small Businesses

Today, Senator John Kerry (D- Mass.) introduced the Healthy Businesses, Healthy Workers Reinsurance Act of 2007, which will tackle the growing crisis of health care costs for families and businesses. Under Kerry's plan, the federal government will pick up part of the cost for the most catastrophic cases -- and in turn, businesses will cover all their employees with quality, preventative coverage. Premiums for all Americans will decrease by up to 10%. Healthy Businesses, Healthy Families is co-sponsored by Senator Jack Reed (D-R.I.).

"The cost of health insurance premiums penalizes small business owners and workers, with rates for families rising 87 percent since 2000," said Senator Kerry, Chairman of the Senate's Small Business Committee and a member of the Finance Committee. "Part of the reason that some small businesses don't cover their workers is an aversion to risk -- a fear that they will be saddled with a sick employee whose high premiums will bankrupt them. But there's a way to fight these high costs -- and it's time Washington makes employers and healthcare plans an offer they can't refuse."

One percent of patients account for a quarter of healthcare costs. And 2 out of 10 patients account for more than 80 percent of all healthcare costs, placing a significant burden on smaller businesses. Today at least 27 million Americans working for small businesses don't have health insurance. Under Kerry's plan, the federal government would reimburse a percentage of these high cost cases if employers include preventative care and health promotion benefits in their health plans, make quality coverage available to all full- time workers, and implement practices proven to make care more affordable. This means lower costs and lower premiums for both employers and employees.

The Legislation establishes a Reinsurance Trust Fund, which would be administered by the Department of Health and Human Services. The fund would reimburse qualified employers and health plans for a portion of the catastrophic health costs of their active and retired employees, and their families.

"Reforming health care in this country requires us to address cost in a comprehensive and meaningful way, "Kerry added. "Many small businesses lack the resources, time, and bargaining power to deal with these rising costs. So it's time the government starts to shoulder some of the burden to help alleviate costs to large employers, small businesses, and families. This will lay the groundwork for achieving our ultimate goal: healthcare coverage for every single American."