Thought of the Day - 01/29/2010

I began my day yesterday at a Corridor Nine Chamber of Commerce breakfast to discuss the status of current political issues on Beacon Hill and Capitol Hill.

One of the things I focused on is the state budget. Basically, I think the budget plan that Governor Patrick released the other day is unsustainable because it relies too much on a risky hope that tax revenues will pick up this year and that additional stimulus money will be received. It also adds about three percent to the bottom line of last year’s budget using one-time money from the federal government and the Rainy Day Fund, money that won’t be there for us when we try to balance the budget next year.

I also talked about health care. To be sure, health care is one of the biggest issues facing America right now given the debate in Washington, D.C. It was interesting to hear Congressman McGovern’s thoughts in that regard. But health care also remains an important policy issue for state government. There’s more our state could do independently to help drive down health care costs. For example, Governor Patrick should be doing more to require insurers, providers and hospitals to be accountable and explain why their costs are going up at regular public hearings. We passed such a law in 2008, but it remains virtually unenforced.

By mid-day, I was sitting in the House Chamber in Boston listening to Speaker Robert DeLeo tell legislators his visions for the upcoming year. He sees the House passing a budget that’s free of new taxes, and possibly a gaming bill that creates jobs. He promised to pass additional cost-saving reforms. Meanwhile, there is lots of talk about the possibility of passing legislation to cut municipal budget costs and to ban texting while driving. It will be interesting to see how these visions play out over the coming months and how many of them turn into reality.

What’s your vision of how things are going on Beacon Hill and where things might go over the next few months? I’d like to know. Please post a comment below.

Thought of the Day - 12/22/2009

There’s a story in the Worcester Business Journal today about a very important issue facing the state’s business community.

The issue relates to our state’s “fair share” health insurance regulations, and it’s posing a significant threat to many small businesses across our state.

Massachusetts businesses are required to offer health insurance to their employees, and rightfully so. Until several years ago, state regulations required businesses to choose to meet one of two thresholds for providing that insurance. In order to comply, businesses could choose to fund at least 33 percent of the cost of health care benefits, or they could offer insurance to at least 25 percent of their employees.

But a couple of years ago, our state changed the rules as part of the sweeping health care reform bill that we passed. Under new state “fair share” health insurance regulations, businesses must comply with both the 33 percent funding and the 25 percent enrollment requirements, or they face a penalty of $295 per employee per year.

Many business owners are having difficulty meeting both of these requirements, particularly the 25 percent enrollment requirement. One reason is that many businesses have employees who receive health insurance from other sources, such as through a spouse’s employer. Those employees are counted as part of the pool of workers used to calculate the 25 percent enrollment guideline. So, it’s theoretically possible that a business might be taxed $295 per employee for failing to provide health insurance to more than a quarter of its workers, even though it actually provides insurance benefits in good faith to all of the workers who request it.

This situation isn’t fair, and it’s the sort of bad business policy that’s making our state uncompetitive and forcing jobs elsewhere. We can’t expect companies to open their doors in Massachusetts so long as we have regulations like this one on the books that make it cost prohibitive to do business here. Job growth here in Massachusetts depends on us having sound business policies in place first.

I support our state’s interest in making sure that businesses offer health insurance to their employees sufficiently, but I believe the fair share regulations need to be amended in several ways, starting with an amendment to exclude from the 25 percent enrollment calculation any workers who receive health insurance from other sources.

What do you think? Do you support the “fair share” regulations as they are now? Or, do you agree that they should be amended to make them more equitable? Please post your comments below to let me know what you think.