June 26, 2017
The Honorable Lindsey Graham
290 Russell Senate Office Building
Washington, DC 20510
The Honorable Tim Scott
717 Hart Senate Office Building
Washington, DC 20510
Dear Senators Graham and Scott,
The South Carolina Small Business Chamber of Commerce urges you to oppose the proposed Senate healthcare reform legislation, the Better Care Reconciliation Act of 2017 (BCRA).
Long before the passage of the Affordable Care Act our organization had supported reforms that would lead to stabilized and affordable health insurance premiums. One of the principle drivers of double-digit increases in premiums was the uncompensated care of the uninsured. To address this problem required that all Americans be covered by some form of health insurance.
The Affordable Care Act, while not perfect, addressed this issue by expanding Medicaid and requiring all citizens to have health insurance unless they could demonstrate economic hardship. The Act provided premium assistance through tax credits for those under 400% of the federal poverty level. It also provided tax credits for qualified small businesses for offering group health insurance.
Because of the Affordable Care Act, the percentage of uninsured Americans is at an all-time low. Small businesses saw a dramatic reduction in health insurance rate increases. Added benefits from higher rates of insureds were a significant stimulus to state and local economies as well as healthier, more productive employees. The healthcare industry became a leading factor in job growth which in turn helped create more consumer demand for the goods and services of small businesses.
Unfortunately, Congress later reneged on the Affordable Care Act’s promised payments to the new nonprofit health insurance cooperatives and threatened the same to private insurance carriers doing business in the Health Insurance Marketplaces. These payments had been built into the long-term business plans of the cooperatives and insurance carriers. As a result the cooperatives have failed and insurance companies have left the Health Insurance Marketplaces often leaving only one or no carrier in certain areas of the country offering health insurance policies.
Now the Senate’s proposed healthcare plan, according to the CBO, would result in 22 million Americans losing their health insurance either involuntarily or voluntarily. The former from reducing funding for Medicaid by over $800 billion over the next 10 years and the latter by eliminating the penalty for individuals not to have health insurance.
This scenario will harm small businesses by causing a dramatic rise in the uncompensated care of the uninsured which will drive up insurance premiums to pre-ACA days (over $1000 additional premium costs for family coverage). The over $800 billion not going into healthcare will pull that much money out of local economies. We will see fewer healthcare workers and some rural hospitals, ones that count on Medicaid for much of their revenue, will close. We will thus see less consumer demand which will hurt small businesses.
Fewer insured workers will mean less healthy and productive employees for small businesses. Fewer small businesses will be able to offer group health insurance because the tax credits will have ended starting in 2019.
The BCRA is a recipe for chaos in the health insurance system that we know today. Small businesses will be hurt in several ways if this bill is enacted.
Again, we urge you to vote in opposition to the BCRA. We would be very happy to work with your offices on addressing needed reforms in health insurance.
Frank Knapp Jr.
President & CEO