BRATTLEBORO — The other day, I happened to speak to a director of a business that employs more than 150 employees. My focus was on Sen. Peter Galbraith's health-care funding bill (S.252), which recommends an 11-percent tax on employer's wages and a 2-percent tax on employees' wages (as a substitute for employer's share and employee's premiums) in order to finance universal health care.
Noting that he was in favor of universal health care, this businessperson opined (off the cuff) that his business would be better off financially under such a tax plan than currently is the case, although he also offered that those firms that only offered “catastrophic” plans would do worse.
While that anecdote public policy does not make, I understand that recent public-policy analyses show that small-business employers pay between 2 percent to 25 percent in contributions toward health-insurance premiums currently.
For small companies, a 2012 member study by the Vermont Business Roundtable, “Health Insurance Coverage and Cost,” showed that the costs “varied from a low of 1.5 percent to a high of nearly 25 percent. But the middle half of the companies in the category had costs between about 5 percent of payroll and 13 percent. The median employer's cost for the smallest companies was 7.3 percent of payroll.”
Hence, Sen. Galbraith's proposal would result in a decrease of health expenditures for some and an increase for others.