Washington, DC – Ways and Means Ranking Member Dave Camp (R-MI) today released the following statement on the announcement that the nation’s leading small business organization, NFIB, is joining 20 state attorneys general in seeking to invalidate the recently enacted health care law.
“This is confirmation for every person worried about their job or looking for work, that the health care law is only making matters worse. If it is bad for small businesses, it is bad for America, and this health care law is bad for both. Instead of increasing costs and adding new mandates on employers, we need to lower their costs so they can start hiring again – that’s what the House Republican bill did.”
Camp also released six facts about the Democrats’ health care law that every American worker must know:
FACT # 1: Employers are already being hit by hundreds of millions of dollars in added
costs, putting the nation’s economic recovery further in doubt.
So far, some of America’s biggest companies have begun warning that the tax changes in the Democrats’ health care bill will reduce their earnings, threatening their ability to hire new workers and retain existing ones. Here is a quick look at just some of those companies, the number of workers they employ, and the added charges to earnings they will bear as a result of the Democrats’ health care bill:
Number of Employees
In Health Care Costs
In order to protect investors, companies are required under law and regulation to report on rapid and current basis material changes in a company’s financial position.
FACT # 2: The Democrats’ health care bill could discourage the hiring of new workers.
The health care bill does nothing to help small businesses with their already skyrocketing health care costs. According to the non-partisan Congressional Budget Office (CBO) premiums will continue to increase. Adding insult to injury, the legislation’s so-called small business tax credits could force employers to choose between hiring new workers and losing the value of the credit. Under the Democrats’ health care bill, the value of the tax credit phases out for businesses with 11 or more workers and disappears completely for those with more than 25 employees. Some small business owners may have to think twice before they seek to hire new employees out of fear they might lose their tax credit on their existing workers.
FACT # 3: The Democrats’ health care bill could encourage employers to keep wages
Further harming the nation’s economic recovery, access to the “small business tax credit” phases out when a small business’s average employee salary exceeds $25,000 and completely prohibits small businesses from receiving these credits if the average employee’s salary exceeds $50,000. As a result, the legislation could give an incentive for employers to keep their employee wages low enough to receive the tax credit. No wonder the National Federation of Independent Businesses (NFIB), which represents more than 350,000 small employers, stated the Democrats’ health overhaul “could have some adverse consequences on employee wages…could lead to workers – especially lower-wage workers – seeing stagnant wages for a longer period of time.”
FACT # 4: Nearly 90 percent of small businesses employees will be forced to grapple
with higher health care costs on their own.
The non-partisan CBO estimated that 88 percent of those who get health insurance from a small employer work for a business that will not receive tax credits under the Democrats’ legislation.
Again, it is no wonder NFIB said, “the small business tax credit will do little to nothing to make purchasing insurance affordable for more small firms.”
FACT # 5: Small businesses that provide more than one-quarter of the jobs in America
are most likely to pay higher Medicare taxes.
The Democrats’ health care overhaul created a new Medicare tax. Since the majority of small businesses pay taxes at the individual level, this tax will hit the income of many small business owners. According to NFIB, “The businesses most likely to see the tax increase are those that employ between 20 to 200 workers. These businesses account for more than one-quarter of the American workforce.” This is the last thing that the 1 in 10 Americans currently out-of-work need. Congress should be looking to help employers create jobs, not adopting policies that further threaten job creation and job growth.
FACT # 6: The Democrats’ health care bill encourages underemployment.
According to recent estimates, up to 20 percent of Americans are underemployed. Yet, despite widespread underemployment, the bill encourages growing small businesses to hire only part-time workers. Under the Democrats’ employer mandate, which includes new taxes based on the number of full-time equivalent employees, only businesses with more than 50 employees are subject to the new taxes. However, part-time employees offer a way to avoid exceeding this threshold. For example, a growing small business could add several part-time employees and as long their total hours do not exceed 120 per month these part-time employees do not count towards the 50 employee threshold.
NOTE: Camp is the author of the House Republican health care bill, which was the only legislation scored by the non-partisan CBO as reducing premiums across the board – for individuals and families as well as small and large businesses. Specifically, CBO estimated the House Republican bill would reduce premiums for small businesses by up to 10 percent or $1,930.