Healthcare Costs for Maine Small Businesses Will More than Double in 10 Years Without Reform

Sausalito, CA, Oct. 20, 2009: New analysis released today by Small Business Majority shows that without healthcare reform, Maine small business owners will pay $1.8 billion in healthcare premiums in 2018 a staggering figure that emphasizes why Maine small business owners number one priority in healthcare reform is containing costs. Maine small business owners spent $746 million on health insurance premiums in 2008. According to projections based on a microsimulation model by MIT economist Jonathan Gruber, that number will more than double in 2018 without comprehensive healthcare reform. Small business people are in an untenable position when it comes to healthcare. Costs are astronomical and rising every year, yet being uninsured can be just as burdensome financially if illness strikes, said John Arensmeyer, founder and chief executive officer of Small Business Majority. ̢???Small businesses are desperate for reform. The cost of doing nothing is just too high. Small Business Majority also polled 200 randomly selected Maine small business owners and found that 88 percent of those not currently offering health insurance say they can't afford to. Of those who do, 81 percent are struggling to provide it. Small business owners overwhelmingly support healthcare reform to relieve them from rising and unpredictable health insurance rates. (The full report is available at http://smallbusinessmajority.org/sbmresearch.php#ME). The costs are really hampering us, said Tom Roberts, owner of Beach Pea Baking Company in Kittery, who would like to grow his business and offer higher salaries but is unable to do either because of high healthcare premiums. "Right now I can only afford to cover 60 percent of the premium for my full-time employees, and that's with a $2,500 deductible. I'd like to offer a plan with a lower deductible, but as it is our premium increased 12 percent this year. We can barely afford what we've got, let alone anything better." Additional information about Maine's insurance premiums:

• Maine's small businesses pay higher rates because of insurance market consolidation. According to the American Medical Association, the top two insurers maintain 88% of the market share.
• The average family premium among companies with fewer than 50 employees is $11,376 per year above the US average of $10,956, according to America's Health Insurance Providers (AHIP).
• The variance in premiums among businesses with 10 or fewer employees is so great that one might pay up to four times as much as another, similar firm of the same size, also according to AHIP.