Health-Care Mandate Wouldn’t Be Equitable

Posted on November 27, 2009

The Nov. 19 Dispatch Business article “Small businesses at heart of debate over requiring companies to insure workers” accurately noted many of the concerns that businesses have with the increasing number of employer mandates. Policymakers who favor requiring employer-provided health care should recognize that a company’s size might not determine its ability to provide health coverage.

Many small employers have a high profit per employee. For example, investment firms generate tens of thousands of dollars in pure profit for a single hire.
On the other hand, some large companies employ thousands of workers in entry-wage positions. They operate on low levels of profit per each employee.

A health-care premium of $400 per year per employee would be less than 2 percent of the profit of a small investment firm but a devastating 20 percent of profits for a casual-dining restaurant.

KRISTEN LOPEZ EASTLICK
Senior economic analyst Employment Policies Institute
Washington, D.C.