Camel pokes nose under Wal-Mart tent

March 13, 2005|by Brien Poffenberger

There is a move underway in Annapolis to impose on businesses the cost of providing health insurance to all Marylanders.

And supporters are making a clever argument. Sponsors and proponents - socially conscious, if misguided - have co-opted the support of cynical commercial interests and are using the language of unfair business practices to achieve their ends.

Dubbed the "Fair Share Health Care Plan," the legislation is bad policy, bad business, and bad for Maryland.

Senate Bill 790 and its companion, House Bill 1284 require that private-sector employers with 10,000 or more employees in Maryland spend at least 8 percent of their payroll on health insurance.

Reasoning that employers who fall below the 8 percent threshold put an undue burden on the state's Medicaid program, the legislation sets up a reporting mechanism and requires that employers who fall below 8 percent pay the difference into a special state fund.


The sponsors of this legislation artfully blend progressive politics and rhetorical misdirection.

Their arguments are meant to appeal to like-minded decision makers while avoiding the notice of the core business community. By setting the number so high - 10,000 employees - the sponsors have placed it beyond the radar of most businesses.

The only employer currently suspected of falling below the 8 percent threshold is Wal-Mart. This is why the argument is so clever. A business in Washington County, even one not currently able to afford health insurance for its employees, may not feel threatened by this legislation.

Most businesses here fall far short of the proposed threshold, and few businesses, large or small, will spend political capital defending Wal-Mart.

But the debate is not about Wal-Mart. The debate is about the role of government and its ability to dictate the spending priorities of businesses in the private sector.

We do not allow government to do that now, and our neighboring, competitor states do not, either. Once the policy is set - once Marylanders say it is OK for government to mandate that businesses provide health insurance to employees - the proposed numbers are just points on the spectrum. Proponents of this legislation support mandating employer-provided universal health coverage, and this is just the first step.

There is little evidence that targeting large employers addresses access to healthcare; in fact, the opposite is true. According to the Kaiser Family Foundation's Annual Employer Health Benefits Survey, nearly all (99 percent) firms with more than 200 employees offer health benefits while that number is just over half for firms with fewer than 10 employees.

The real threat to insuring Marylanders comes from small businesses who decide that they can no longer afford to offer coverage. That is where legislators on both sides of the aisle should be focusing their efforts.

Beyond the disturbing prospect of government's expanded role, this legislation has proponents who do want the debate to be about Wal-Mart. Firms that have lost to Wal-Mart in the marketplace see an opportunity to beat the giant retailer in the State House. The market should be free to decide which competitive advantages are legitimate, and each player in the market is free to shift that opinion in the mind of the consumer. Government should set the broad parameters and avoid becoming the referee.

The chamber shares the social concern behind this legislation - access to healthcare - and we encourage the General Assembly to continue to search for solutions.

We suggest, however, that it starts by curbing the ever-increasing health insurance premiums for small business rather than targeting one large company.

Brien Poffenberger is president of the Hagerstown/Washington County Chamber of Commerce.

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