[Congressional Record Volume 140, Number 62 (Wednesday, May 18, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: May 18, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                     HEALTH CARE AND SMALL BUSINESS

  The SPEAKER pro tempore (Mr. Dooley). Under the Speaker's announced 
policy of February 11, 1994, the gentleman from Michigan [Mr. Bonior] 
is recognized for 60 minutes as the designee of the majority leader.
  Mr. BONIOR. Mr. Speaker, tonight I wish to address the health care 
issue as it relates to the small business community.
  Mr. Speaker, about 2 weeks ago there was a really big press 
conference on Capitol Hill, and like many press conferences around here 
the past few months, this one was about health care reform. The group 
that called it strongly urged the passage of comprehensive health care 
reform and strongly supported the goals of the President's health care 
plan.
  That comes as no surprise because there are millions of Americans who 
support the President's health care plan. Mr. Speaker, what comes as a 
surprise is that the group that called the press conference was a 
coalition of small businesses. They represent over 340,000 small 
businesses and over 3.1 million employees.
  The reason I say that it comes as a surprise is that if you believe 
what you read in the newspapers or hear on your TV sets, or even if you 
believe some of the press releases from the groups that oppose health 
care reform at any cost, you would be led to believe that small 
businesses do not want health care reform. But the truth is small 
businesses especially, and this is critically important, especially the 
small businesses that now took up the responsibility that was before 
them and insure their employees, they are the strongest supporters of 
health care reform.
  Mr. Speaker, I am joined tonight by my good colleague, the gentleman 
from West Virginia [Mr. Bob Wise], and will soon be joined by the 
gentlewoman from Connecticut [Ms. DeLauro], to talk about this issue.
  For anybody who owns a small business, they know the reason why when 
people talk about health care crisis in America nobody has been hit 
harder by the high cost of health care than the small business 
community, nobody. If you were to sit down and come up with a new 
health care system, chances are you could not possibly design one that 
is worse for the small business community than the system that we have 
today. You could not figure it out any better to have a system that is 
as bad for these business people.
  Put simply, Mr. Speaker, our current health care system is killing 
small business today. Let us look at some facts.
  Today small businesses pay an average of 25 to 35 percent more for 
coverage than big business, and that is because they do not have the 
market muscle that big businesses have to bargain for a better rate. So 
all of the power is on the side of providers. There is no negotiation. 
It is an either take it or leave it coverage.
  Every single year, every single year health care costs for the 
average small business increases anywhere between 20 and 50 percent, 
every single year. For most small businesses to insure their employees 
today, they can only afford really basic, bare bones coverage, and that 
is because it costs too much to get good coverage. So they end up 
paying too much, and they get too little coverage.
  What is more, small business is subject today to every single abuse 
that exists in our current health care system. About 15 percent of the 
small firms in America today fall into industries that insurance 
companies refuse to provide coverage to because they are considered 
high risk, places like beauty salons and florist shops, hospitals and 
logging or mining industries. This is known in the business, in the 
parlance of the business as occupational redlining, and it is rampant 
in America today.
  What is more, insurance companies often refuse to cover small 
businesses or price their coverage so high that they cannot afford it 
simply because one or more of their employees have what everyone I 
think is learning to call now preexisting conditions. So if you have 
somebody in a firm that may have 10 people with a preexisting 
condition, often times you are not able to afford or will not be able 
to even get insurance for your employees. What often happens in those 
cases is that small business will cover their employees, but exclude 
the people who have preexisting conditions for the first year. But when 
the year is over, those employees are allowed to join the plan, only to 
find the cost of coverage has gone up so much because of them that the 
employer basically has to drop coverage altogether.
  On top of that, most small businesses do not have benefits 
departments so that the owner has to take time away from dealing with 
his customers in order to haggle with the insurance company and fill 
out all of those forms.
  Then add to that the fact that the workers' compensation costs have 
been going through the roof because the medical portion of Workmen's 
Comp has climbed from 35 to 40 percent and up to 50 percent of the 
total cost. If you are self-employed, if you are a farmer or an 
independent contractor, then you cannot deduct 100 percent of your 
costs like everyone else; you can only deduct about 25 percent of the 
cost.
  Mr. Speaker, those are just some of the challenges that face every 
small business person today. It is no wonder that they are up against 
the wall when trying to provide coverage for their employees and 
instill a stable work environment where they can keep their employees.
  Yet, even with all of these challenges, 70 percent of small 
businesses today provide some kind of coverage to their employees. Even 
with all of that, the community believes that it is worth it from a 
community standpoint, from a good business standpoint, from a 
standpoint of retaining these workers, they believe it, and so 70 
percent of small businesses provide some kind of coverage.

  But the ultimate indignity is that the firms that do cover their 
employees not only have to compete against the firms that are getting 
the free ride, that do not, but they have to pick up their costs as 
well. You may ask how does that work.
  People who are not covered by their employer still get health care 
when they need it, but they just get treated like most people who do 
not have health care coverage are treated, they go to the emergency 
room which is the most expensive part of getting care where the cost is 
four times more than an average doctor's office call, but guess who 
pays the bill? The small business does. They end up paying for their 
competitors who do not insure.
  So Mr. Speaker, the bottom line is that the private sector has failed 
small business on health care. The private sector has failed small 
business on health care. Big business has enough market muscle to deal 
with the problem, but small business has tried everything over the past 
decade to keep pace, and nothing has worked. They have tried switching 
programs, managed care, self-insurance, reducing benefits, passing 
along a bigger share to the employees, and everything has failed. The 
costs still rise between 20 percent and 50 percent every single year.

                              {time}  1940

  The cost of health care continues to grow at an extraordinary rate, 
and the smaller the business, the less clout, the higher the cost.
  Mr. Speaker, we cannot afford to nibble around the edges any longer. 
It is time for comprehensive reform to make the system work for small 
business, and that is exactly what the President's plan does.
  Small businesses are finding that when they read the fine print on 
the President's plan, they like what they see. Forget what you have 
heard from all the nay-sayers who do not want health care reform at any 
price, the fact is the President's plan will help small business in a 
number of different ways. First, the President's plan makes it possible 
for the first time for small business to buy good, rock-solid coverage, 
insurance that is as good as any plan offered by the Fortune 500 
companies. Small business will no longer be stuck with only being able 
to afford these bare-bones coverages, and they will not lose employees 
to bigger companies just because of health care benefits, because they 
will be able to offer the same plan.
  Now, second, it shifts the power of the marketplace to small 
businesses, so it has the same muscle as big business. Of course, no 
insurance is any good if you cannot afford it.
  The President's plan provides discounts, discounts for small 
business, and we are in the process today of making the plan even 
stronger by exempting certain small businesses altogether and making it 
easier for others to phase in coverage.
  And, third, it controls the cost of premiums and copayments. No more 
jacking up rates if an employee gets sick.
  Fourth, it increases the choices employees and businesses have of 
their doctors in the plans. As you know today, only one in three 
companies with fewer than 500 employees offer any choice at all. Under 
the President's plan, everyone can follow their doctor to any health 
plan that they may join. And everyone will have a minimum of at least 
three different kinds of plans to choose from.
  Now, fifth, it stops insurance company abuses. No more occupational 
redlining, no more preexisting conditions, no more price baiting.
  Sixth, it allows people who are self-employed like farmers to deduct 
100 percent instead of the 25 percent of the cost, which will be a 
tremendous savings for families who have small independent businesses.
  And, seventh, it gets workers' compensation costs under control, and 
it folds the worker portion of workers' comp into health care.
  Above all, eighth, it requires all of us to take responsibility for 
the system. No longer will small businesses who cover their employees 
have to pay for those who do not.
  Everyone will have a role. That is basically what the plan does. And 
those people who say that it does not matter what plan we choose remind 
me about the old story about the veterinarian and the taxidermist who 
shared the same office together, and their motto was, ``Either way, you 
get your dog back.''
  It does matter. It does matter. It makes a difference. And, of 
course, the big question is: How do we finance it? There are basically 
three ways.
  First, you can do a single-payer plan like they have in Canada which 
says the Government should run our health care system. It is built 
around the principle that one size fits all. But what works in Michigan 
will not necessarily work in West Virginia, Connecticut, or New Mexico, 
and we will have to raise taxes too much to do it. Frankly, politically 
it is not feasible to do that at this point in this Congress.

  Second, there is the family mandate making families solely 
responsible for coverage. But if that happens, many businesses may just 
offload onto families, and I think that is too much for families to 
handle, if we had individual or family mandates. We have that now, if 
you want, you can provide, but many cannot provide.
  The third choice is for employees and employers to share costs and 
build on the system that we have now.
  Now, today 70 percent of small businesses cover their employees, and 
9 out of 10 people who are covered get benefits at work. The most 
interesting statistic is that 8 out of 10 uninsured people in this 
country have jobs.
  Well, this makes the most sense. And I know there is a lot of concern 
about how much it will cost small business. We are addressing the 
problem now, and we are working on ways to offer more exemptions and 
subsidies for small businesses. There is a myriad of formulas out 
there. We are trying to craft things that will make it compatible and 
workable and affordable for our small-business community.
  But for those who cover their employees now, the majority of 
businesses, they will get more coverage for less, and that is basically 
what we will end up with. You will get more coverage for less if you 
already cover your people.
  The Wall Street Journal said this is a bonanza, the Clinton health 
care plan is a bonanza or something to that effect for the small-
business community, and they are no friends of the President, as many 
of you understand and recognize. But they recognize the economics of 
the plan, and for those who do not cover their employees now, they may 
pay a little more, but when you look at how much, you realize it is no 
more than the cost of an increase in the minimum wage. Either way, it 
is a lot better than the system we have now.
  Health care reform will not work if it does not work for small 
business. We know that, and that is why we are working hard. We are 
working diligently to give small business the best deal that we can.
  The small businesses who were at the press conference a few weeks ago 
realize we will never get the system under control until we make 
everyone take responsibility for it. Everybody has to take 
responsibility, no more free rides. We are in this together. If we are 
in it together and if we work together, it will work well for all of 
us. But if we have companies taking a free ride on other companies, 
then it becomes cannibalistic, and then you are in a situation where 
you do not have your muscle for bargaining and your negotiations for 
lower rates, a decrease. Responsibility is the key in all aspects of 
life, whether it is family, whether it is religion, whether it is work, 
and responsibility is a key ingredient as we move forward to deal with 
this small-business health care crisis.
  As I said earlier, we could not have dreamed up, if we stayed up all 
night, a worse system than we have now for the small-business community 
when it deals with health care. So the message is there can be no more 
something for nothing. We have all got to play a role in getting the 
system under control.
  We ask everyone to open their minds, to open their hearts, and to 
work with us as we try to craft legislation that will truly be 
important, not only to employees in this country but to the owners of 
small businesses as well.
  I would be happy to yield to my friend, the gentleman from West 
Virginia, and to my colleague, the gentlewoman from Connecticut, who 
have both been champions on health care certainly, but especially on 
the issues of health care.
  Mr. WISE. Mr. Speaker, I thank very much the gentleman from Michigan 
for yielding and taking this time and for beginning to sound the 
drumbeat which is particularly for small business.
  Check this package out carefully. Do not buy a pig in a poke, but do 
not buy those who are telling you that the President's plan is not good 
for small business.
  I have got this mental image that in a few short months, let us 
assume for a second the President's plan is not successful, does not 
pass; I have got this mental image in a few short months of a group of 
small business people suddenly beginning to read what went by, what 
they missed, what got voted down, and calling up some of their so-
called advocates, for instance, such as the National Federation of 
Independent Business People, calling them up and saying,

       What in the world have you done? You let a chance get away 
     that I could have employed my workers for as low as, in the 
     case of companies under 25 employees, with an average salary 
     of less than $12,000, you let a chance get away that I could 
     have employed my workers, insured my workers, in a 
     comprehensive plan average of the Fortune 500 plans, 
     guaranteed benefits for 3\1/2\ percent of my gross payroll.

  Many small businesses are paying that much in workers' comp already.
  If your business is predominantly, as many businesses are, 
particularly in restaurants and particularly in other sectors, is 
predominantly minimum wage, then you can insure under the Clinton plan 
your people for as low as 19 cents an hour. The last minimum wage 
increase that this Congress passed in 1988 was 90 cents an hour 
implemented over a 2-year period, 45 cents a year.
  Nineteen cents an hour, and you have got complete coverage. You had 
better read it. I hope small businesses will read that package. I hope 
they will question those who are telling them it is so bad.
  My concern over what is happening in this argument is the first 
statement in the President's package dealing with small business is 
what is quoted, but nobody pays attention to the next sentence. The 
first sentence is that all businesses will be required to pay 80 
percent of the premium. That's what scares a lot of people. They never 
hear, because there are some people who do not want them to hear; they 
never hear the second line. The second line is but the premiums costs 
to the small businessperson are capped, and in no case under the 
President's plan can it exceed 7.9 percent of your gross payroll. That 
is it, 7.9 percent.
  A friend of mine runs a machine shop, has about 35 employees. He 
provides, because he believes he should, he provides insurance for 
those employees, health insurance.

                              {time}  1950

  He was giving me heck about a year ago on the provisions as he 
understood them of the Clinton plan. I finally said, ``Stop for a 
second, Ray, what percentage are you paying right now?'' He said about 
14 percent of his payroll. I said, ``Do you understand there will be 
complete coverage for all your employees and it cannot exceed 7.9 
percent of your payroll?'' He said, ``You mean I get a reduction?'' I 
said, ``You not only get a reduction, you probably get an improved 
policy.'' He said ``you guys probably will raise it a point or two and 
it is still an incredible deal.''
  I was in a restaurant operated by--a small mom and pop restaurant 
operated by two very good friends of mine in a rural community in West 
Virginia. Clyde was expressing concern to me about what the costs could 
be if there were mandated coverage. He said, ``Bob, we are doing the 
best we can. We cannot afford health insurance for our employees.'' I 
went through the details. And he has roughly 10 employees at basically 
minimum wage. I said, ``Do you understand that you would pay no more 
than 3.5 percent of your payroll?'' He paid more than that for the 
family policy that covered only him and his wife. And now he could 
cover all of his employees and deduct 100 percent.
  Mr. BONIOR. And deduct 100 percent.
  Mr. WISE. Yes.
  Self-employed are able to deduct the 100 percent as opposed to the 25 
percent that they can deduct now, all for the cost, in that particular 
situation once again, of about 19 cents an hour.
  Now many of us look for the best buy. So we go to a store--now this 
is not small business understand. It is Wal-Mart. We go into Wal-Mart 
because it is a discount store, because there is a markdown. What they 
are not telling you is that for all of us as taxpayers, and they as 
consumers, they are marking up. Why? Because Wal-Mart--and I do not 
want to single out Wal-Mart because too many retailers are doing this, 
but Wal-Mart only insures about half their employees. That leaves many, 
many thousands uninsured. It has been estimated that the uninsured 
group are spending something consuming around $480 million a year in 
health care services. Somebody is paying for it. So when you go into a 
discount store and those employees are not covered by health insurance, 
you are getting a savings on the item marked down but they are not 
telling you that your health insurance premium that you are paying is 
marked up 30 percent to cover those who are uninsured.
  So every time we see that label in the store that says ``markdown'' 
ask whether those employees are insured because what is happening is 
there is a markup. Everyone who has private paid insurance, whether 
Blue Cross, Aetna, wherever you get your policy, the chances are 
excellent that you are paying 30 percent in your premium costs, not for 
your coverage but for the coverage of all of those who are not covered.
  Mr. BONIOR. Because those who are not covered when they get sick go 
into the emergency room where the cost is four times higher than it is 
in a doctor's office. That cost is spread, gets spread and everybody 
else pays it. Everybody has an example of being in a hospital or having 
that cost, that you just referred to, spread on their bill. They wonder 
why is this bill so outrageous? It is outrageously high oftentimes 
because you are picking up the costs of those employees who are not 
insured.
  Mr. WISE. The gentleman is correct. They are going in sicker and they 
are going in at the most expensive rate. And everybody pays as a 
taxpayer, as a consumer.

  I will sit down in just a second but I want to talk for a second 
about my spending some time in the food industry. I think we have to 
get this health care debate in terms that all of us deal with.
  Most of us eat pizza. I was fascinated recently when the chairman of 
Godfather's pizza, a large pizza chain in many parts of our country who 
challenged the President and said that this would be catastrophic to 
his business. I did some calculations based on the figures that the 
Godfather's CEO provided to the President.
  What I found out was that in the case of the $10 pizza, the 
application of the President's plan at the most would be 20 cents more 
per pizza, per $10 pizza, and possibly as low as 10 cents, based upon 
the cost of labor versus the total profits or total earnings of that 
company.
  Now while the Godfather's CEO employees, some of his employees are 
insured, some of the employees are not insured. So that means that not 
only are we paying for the pizza, but we have the privilege of paying 
for their health care either through Medicaid or through our own 
insurance premiums in the cost-shifting when the employee eventually 
gets sick and goes into the hospital. What was not even mentioned is 
that while the increase might be 10 cents or 20 cents per pizza, which 
is about at the maximum I think of one-third of the cost of a new 
topping, the maximum cost could be that much but the offsets are these: 
They are going to lower worker's compensation costs, particularly that 
portion dealing with health care. The cost shifting will stop, which 
means I am not going to be paying for somebody else with insurance who 
is not going to be paying for that Godfather's employee who does not 
have insurance, but yet still goes into the emergency room. Finally, 
everybody is going to be on a level playing field.
  That restaurant owner, that pizza operator or preparer who does 
provide health insurance is operating at a disadvantage to Godfather's. 
I think that is significant as well.
  I think we are going to have a lively discussion, but at this point I 
will stop and let my colleagues proceed.
  Mr. BONIOR. My colleague is absolutely right and I thank him for his 
comments. You know, people have to take responsibility. We cannot be 
freeloading off of each other. The businesses who are not stepping up 
and facing this in a real way but will provide their employees with 
good coverage at a reasonable rate lower than, in many instances, than 
the increase in the minimum wage for instance and want to continue the 
system that they have and ride off the backs of others are not being 
fair with the rest of the business community.
  Mr. Speaker, I yield to my friend, the gentlewoman from Connecticut.
  Ms. DeLAURO. I thank my friend for yielding. I am really delighted to 
be able to join with my colleagues tonight and engage in this effort. I 
think one of the critical things we can do--I think the word drumbeat 
is a good one because I think we ought to stand here as many nights as 
we can, particularly on this issue of health care and small business, 
and to try to really push away the incredible misimpressions that there 
have been surrounding this. We need to fight back on this. I think we 
ought to do that over the next several weeks and months because over 
the past weeks and months much has been said to scare small business 
into believing that health care reform is going to take away their 
profits, force them to fire employees. That is just not the case, 
simply not the case. What we need to do, as some of which has been done 
here tonight, is to put what the President has proposed in some sort of 
perspective, to take stock of what small businesses face today and look 
at what the circumstances are.
  Small businesses health care costs are rising at a rate of 20 to 50 
percent on a yearly basis.
  Mr. BONIOR. Every year, every single year.
  Ms. DeLAURO. It is startling what they are paying.
  And the plan offers the small business owner a discount. Also, 
something that is being fought against, but we do not emphasize enough 
and we ought to begin to emphasize, what the President has talked about 
is a premium cap so that every single year we can eliminate that 20 to 
50 percent increase for small businesses. There are a lot of folks who 
are screaming about the premium cap. But we have to try to do something 
to keep it down and to keep the costs, health care costs from 
escalating beyond what wages are doing these days. That is what has not 
happened in the last several years.
  As my colleague from Michigan pointed out, business owners can only 
afford bare bones coverage for their employees. The Clinton plan makes 
it possible for an employer to provide a comprehensive benefit package 
and to be able to offer their employees, in the same as the big 
businesses do. The susceptibility to discriminatory insurance programs, 
occupational red-lining, preexisting conditions. Let me use myself as 
an example. I have a preexisting condition. I am a survivor of ovarian 
cancer. Today I have a wonderful job serving as a Member of the House 
of Representatives. I get paid a good salary. I have health care 
coverage. I share in the costs of my health care. First of all, 
individuals will be able to get similar kinds of health insurance today 
that Members of Congress are getting but more importantly if the voters 
of the 3d district of Connecticut decide I should not serve in this 
body any longer and I go to look for a job somewhere else, no business, 
small business, wants to hire me. Their premiums would go up 
tremendously. They do not want to include me in their small group 
policy because I would drive the costs up off the charts.

                              {time}  2000

  So these kinds of conditions and exclusions that would be prohibited 
are critical. Also, based on age, and gender, and price discrimination, 
these practices would be outlawed.
  The self-employed, the 25 percent deduction which small businesses 
are getting now, would rise to a 100 percent deduction.
  So, we make the point, we have made it, that the current system 
clearly is not working for small businesses, and what we are not 
proposing to do is to tear down what we have built up where nine out of 
ten people today get their insurance, if they were insured, through 
their business, but to build on that system, and anyone would say, 
``Let's not go back to square one; let's build on the current system 
that we already have.''
  Mr. BONIOR. There are good things about the system.
  Ms. DeLAURO. Right.
  Mr. BONIOR. I am talking about the small business part of it that is 
pretty much of a disaster. But with respect to our doctors, nurses, our 
skilled and our wonderful people, they generally do very exceptional 
work. We have to build on that, and, as the gentlewoman has just 
mentioned, we ought to build on the system we have that is employer 
based.
  Ms. DeLAURO. And we do have the best health care in the world. The 
problem is not everybody is sharing in the opportunity to get access to 
that health care or can afford it today, and particularly a small 
business cannot afford to do it.
  Let me make one other point. Oftentimes I know my colleagues hear 
that there are people on welfare, and people on welfare get their 
health care free, and that should not be the case, and it should not be 
the case. If we do provide a system, why, if we want to create 
incentives for people to go to work in this country, which we should 
do; we all espouse the values of work, and, if that individual goes to 
get a job somewhere, and in fact the employer does not provide any 
health care, where is the incentive for an individual to say, ``I'm 
going to take this job,'' when they are not going to get protected, 
they are not going to get any protection, their family is not going to 
get any protection for health care and the cost of health care. It 
flies in the face of anything that is real about trying to bring some 
sense to our system.
  Mr. BONIOR. This health care bill is the first major step in welfare 
reform. It just follows naturally; the gentlewoman is absolutely 
correct.
  Ms. DeLAURO. Well, I think the organizations today that are lobbying 
against the health care reform bill, and they claim to be doing that on 
behalf of small businesses, are actually, in fact, hurting the very 
businesses they claim that they want to support. They really ought to 
be working with those of us who are in Congress who are trying to 
really help the small business man and women who are ready to try to do 
the right thing by providing health care and those that want to do it 
but cannot because the costs are prohibitive.
  Let me just mention a couple of examples in my own community.
  Harry Pappas, who I have mentioned before on the floor of this House, 
who is in the drycleaning business, he took the time to do the math on 
his health care for himself. He received a package from the National 
Federation of Independent Businesses, and they told him that he should 
phone me to tell me to vote against the President's health care plan 
because it was bad for small business, and they provided him with a 
worksheet. Well, Harry took out the worksheet, figured it all out, and 
he found out for his 11 people he would pay 37 percent less, 37 percent 
less in his health care costs. So, Mr. Speaker, when he did phone me to 
talk to me he called to ask me to please support the President's health 
care plan.

  Kathy Berko, who is another small business owner in my district, she 
wants to try to provider her employees with profit sharing and 
retirement benefits, but she cannot do that because her costs to 
provide health care continue to go up, and for one employee the premium 
went up 50 percent in just 2 years.
  I think again, as we have said here tonight, that the more small 
businesses hear the truth about what is in this health care reform 
package, the more that they will begin to appreciate the advantages, 
and I think we have to take on that responsibility because others are 
out there in great force because there is a lot at stake. There is a 
lot of money at stake in this plan, and we have got to take it on to 
try to get the message out to small businesses that health care reform 
is right for them and right for the American people.
  Let me just mention one more point, and then we will engage in a 
conversation.
  Many businesses, Safeway, United Airlines, Xerox, Time Warner, 
members of the National Leadership Coalition for Health Care Reform, 
have already thrown their support behind the President's health care 
reform bill. It is good for business. Health care reform that has been 
proposed is good for business, and I say, whether you're General Motors 
with a listing on Wall Street, or whether you are Washington Cleaners 
with an address on Main Street, I think we see that this is going to 
help small businesses provide health insurance and to keep their costs 
down.
  So, Mr. Speaker, I am really pleased to join with my colleagues 
tonight and to continue to beat that drum so that we can, in fact, do 
something for the American people and for American business.
  Mr. BONIOR. I thank my colleague for her contribution and for 
illustrating vividly with those examples just what is at stake for 
individual business people. And I make the plea, as well, tonight that 
our business community look carefully at what we are suggesting here.
  I say, don't dismiss it. Don't just take the word of the NFIB or your 
neighbor. Do the worksheet like your friend did, and find out what 
effect it will have for you and for your employees, and I think you're 
going to be pleasantly surprised. And for those of you who dont' 
provide it now, you will be able to provide it, as the gentleman from 
West Virginia said, in some instances as low as 19 cents an hour, which 
is far less than what the last minimum wage increase was. In some 
instances it will be higher than that, but you will be able to provide 
for your employees, and there is nothing more important in the 
relationship in a firm between the employer and the employee. The type 
of quality of work that's done is oftentimes related to how you treat 
your employees, and we are trying to make it all work for everyone in 
this country, and please help us and join us in this effort.
  I yield now to the gentleman from West Virginia [Mr. Wise].
  Mr. WISE. Mr. Speaker, I think the idea that the gentleman from 
Michigan [Mr. Bonior] and the gentlewoman from Connecticut [Ms. 
DeLauro] have is excellent in encouraging all small businesses to 
view this just as they would when various insurance agents come to tell 
them about a plan, and that is really what is happening. I say, you 
have got the NFIB which wants to sell you no plan, keep it as it is. 
It's not working for you, but the devil you know is probably better 
than the devil you don't know--I guess is the best positive spin I can 
put on it. But then also look at the other plans out there, the cost of 
doing nothing, the cost of some of the plans that are presented, and 
then particularly the President's plan and some of the spinoffs that 
the developing by trying to accommodate the additional concerns of 
small business.

  Mr. Speaker, I have been amazed at every time I have dealt with a 
small business person, and recently there were several NFIB 
representative members--not representatives, but members, of the group 
in my office from home. I find out when we sit down and talk about it 
that the President's plan gives them a better deal.
  There is one gentleman I was meeting with last week who expressed 
great concern about mandates and how he would be affected under the 
President's plan. I said, well, give me some information. I'm not 
looking for proprietary information, but tell me a little bit about 
your business.
  He worked very hard to provide a 60-40 cost share on the premium. He 
paid 60; his employees paid 40. Of course under the President's plan he 
would pay 80, so he would pay more theoretically. The employee would 
pay 20. But yet what he does not have today, but what he gets under the 
President's plan, is a significant, significant subsidy, and the result 
is that in--which he even, I think, concluded at the end of our 
discussion--he would get a much better policy at a lower cost to 
himself and to his business, much less to his employee, better policy, 
better cost arrangement for both concerned, lower costs, and so that is 
the kind of comparison that needs to take place.
  I am not asking the people to take my representations, or my 
colleague's representations, or even he President's representations, at 
face value. Certainly do not take those who are saying, ``Don't do 
it.''
  Mandates interest me. Now I guess that, yes, everyone would be 
required to provide insurance with the assistance that we mentioned. Of 
course what is not mentioned is that everyone is required to 
participate in some form. All of us have copayments under the 
President's plan. All of us have deductibles. There is no free lunch. 
Everyone pays at least according to their income on a sliding scale, 
and so everyone is in this system is some way, and everyone is making a 
contribution, not just the business.

  But if I were a business person, a small business person, I would, 
too, be a little suspicious and say, great I've got OSHA to worry 
about, I've got wage and hour paperwork to do, I've got this and that, 
all of these mandates, and what am I getting for it?
  I say, here you are getting something. First of all, you are doing 
what you know you wanted to do anyhow. You're trying to provide health 
insurance for your employees, but you're getting it at a much lower 
cost and getting a much better policy.
  There is a lot of talk about unfunded mandates. This one comes with 
the funds attached to it. This one works.
  There is one question I get and, I suspect, that each of those of us 
participating tonight gets. It is the final fallback is, ``All right, 
Wise. You say that this is such a great plan, but how can you guarantee 
to me that the cost won't go up in a couple of years after we get it 
implemented? You know how you folks in Congress are.''
  Well, let me tell my colleagues what I can guarantee to them right 
now.

                              {time}  2010

  I can guarantee to you that if you have health insurance, if you buy 
it for your employees, your cost is going up without the President's 
plan.
  As the gentleman from Michigan and the gentlewoman from Connecticut 
have pointed out, you are going up 20 to 50 percent automatically every 
year.
  My father was a health insurance agent and the thing that he dreaded, 
particularly in the late 1970's, early 1980's was taking the premium 
increase around to the businesses that he was serving because they 
would not believe him. They would think that he was gouging, and he 
said that this is what will happen, and a lot of business people today 
confirmed this for me, is ``They will kick me out of their office and 
they will cancel the policy I am selling them and they will then shop 
around and find somebody that will sell them the policy cheaper. They 
will sell them cheaper the first year to get in the door. The next year 
the policy cost goes up sharply and they are right back in the same 
situation again.''
  It is funny how many times I tell that story and I can see heads 
nodding, ``Oh, yeah, that's happened to me twice already in the last 5 
years.''
  Everyone knows that costs are going up sharply in the present system. 
Here we have a plan where everybody is in the pool, everybody is paying 
something, where the emphasis is on cost containment and where the 
costs to the business are capped. That is the best guarantee I think we 
can get.
  Ms. DeLAURO. I have found that in terms of talking to small 
businesses and to being very up front with them and I do not shy away 
from this issue at all. Some people say, ``Well, I don't want to sit 
down and talk and you not be able to answer the questions.'' I think 
when we sit down with small businesses, and I have done a lot of small 
business meetings, with groups of 10 or 15 people, and we go through 
the entire plan, what is in the plan for small businesses and be very 
honest and up front with them.
  For those businesses who now do not provide any kind of insurance for 
their employees, in fact, they are going to have to provide something. 
Nobody is standing here and saying that that is not the case. But when 
I sit down and go through it, they look at me with an expression on 
their faces, ``My God, we didn't know that, we didn't understand that. 
Why didn't we?''
  I have to ask myself, ``Why didn't we?'' I think that we all need to 
do that, those of us here tonight and the rest of our colleagues. We 
have got to take on those naysayers and begin to show small businesses 
what is in this plan on their behalf.
  They should not take our word for it, the President's or the NFIB, 
they should sit down and we ought to try as many ways as we can to 
provide the opportunity for them to get the answers to these questions, 
because while they do want to see reform, there is a healthy skepticism 
and they should. Those questions ought to be answered. But 9 out of 10 
times I can sit with a group of people that from the outset may have 
these concerns and fears and probably 85 to 90 percent of those fears 
and concerns are allayed by the time we walk out the door. It really is 
incredible.
  Mr. BONIOR. I think the sense of taking our word for it is well-
taken. My colleagues have both spoken about that today. People are 
skeptical. But the Wall Street Journal, and I have said this already 
tonight, I will say it again. When they come out and say this is a 
great bargain for the small business community, the Clinton health care 
plan, I think that ought to raise a red flag and people ought to say, 
``Well, at least maybe I ought to look at it in that respect.''
  Mr. WISE. I am not quoting the Wall Street Journal a whole lot on a 
lot of issues.
  Mr. BONIOR. I am not, either. But occasionally they are right.
  Mr. WISE. On this one the facts are with us.
  If you are a small business person, take your payroll, whatever it 
is, $100,000, for instance, and say, ``What is the very most I could be 
paying under the Clinton health plan?''
  Say 7.9 percent, we will round it off to 8, $8,000, but do not stop 
there, to quote again my dad.
  If you have less than 75 employees, it is going to be lower than 
that. Get the formula. For instance, if you are under 25 employees and 
less than $12,000 average annual wage per employee, it is going to be 
3\1/2\ percent. So in a $100,000 payroll, you are somewhere between 
$8,000 and $3,500. I am willing to wager many small businesses are 
providing health insurance for just the family members in that 
business, the operator and his or her spouse.
  Mr. BONIOR. That reach that level.
  Mr. WISE. Yes, for that amount.
  So that is the kind of pencil work that every business needs to do 
before they react to it.
  The gentlewoman mentioned businesses supporting it and there were a 
whole group of them that came out the other day. I think it is 
significant; there is a lot of concern over profit margins. The grocery 
retailing sector has probably the lowest profit margin of just about 
any in the retail sector, if not the lowest profit margin period, yet 
significant stores like Safeway, Pathmart in the Northeast and others 
have come out in favor of a comprehensive national health care plan.
  I might point out that retailing overall, the Wal-Marts, for 
instance, of the world average somewhere around 2-\1/2\ to 3 percent. 
Those with the lower profit margins are providing health insurance, 
even though they have a lower profit margin in the nature of their 
business, they are finding it makes good business.
  I have a lot of sympathy for, and what all of us are trying to do is 
work with that small business person who wants to provide health 
insurance and is up against the wall, does not have the profit margin, 
cannot do it. I do not have a lot of sympathy for the one, and I ran 
into one of these folks the other day, who said, ``I won't accept a 
mandate. I will not provide coverage. It's not my obligation.''
  If you do not like people putting their burdens on you, why is it 
that business A which provides insurance, works next door to business B 
and is in competition with them for the same product, business A does 
provide insurance, business B does not. Yet who has the competitive 
edge, the one who does not live up to his or her obligations.
  So I would hope that small businesses that are providing insurance, 
and many of them have told me this, would say, ``Wait a minute. Let's 
get everybody on that level playing field.'' It is good policy but it 
is also good competition.
  Ms. DeLAURO. That is the other thing that happens in these small 
group gatherings. Those that do provide the insurance begin to look at 
those who do not. Because as our colleague from Michigan said, people 
in places where they do not provide insurance, they get sick, their 
families get sick, they go somewhere and those costs just do not 
disappear. They just are not in that either. They get passed on.
  I think it is a very careful consideration. I think other businesses 
who are now doing this need to talk to their colleagues, they need to 
talk to their conferees and say, ``Hey, come aboard.'' Everyone has a 
responsibility in this effort.
  Mr. WISE. In each one of our States that is represented here tonight, 
probably in your State, as in mine this last year, the most troublesome 
issue in the State legislature was funding Medicaid. Medicaid, health 
care for the low income, was the fastest rising cost to States. One of 
the reasons is just what we are saying, that low-income workers who 
when they finally do get sick do not have insurance, goes into the 
hospital, and that is when Medicaid kicks in and that is when the 
taxpayers pay. There is no free ride.
  When we see that markdown in a discount store and they are not 
providing health insurance, we are paying for it. We are just paying 
for it in our tax bill and in our insurance premium instead of at the 
cash register.
  Mr. BONIOR. Mr. Speaker, I thank my colleagues for their comments and 
for their patience and for their eloquence this evening. I look forward 
to talking about this same issue with them on other occasions.

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