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Who Represents Small Business in Health Care Reform?

Posted by: John Tozzi on July 07, 2009

There’s a YouTube video making the rounds that takes aim at two progressive groups lobbying for health care reform, the Small Business Majority and the Main Street Alliance.

The video, produced by a group that calls itself the Small Business Coalition for Affordable Health Care, basically says the Small Business Majority and Main Street Alliance wrongly claim to represent mainstream small business perspectives on health care reform.

The coalition says it represents 162 small business membership organizations. They’re mostly trade associations and other industry groups, as well as some well-known small business groups like the National Association for the Self-Employed and the National Federation of Independent Business. (The NFIB seems to be running the show, as the contacts on the coalition’s site are NFIB staff.)

But there are also some groups listed as members that don’t seem to have any clear connection with small business, however, and some with direct stakes in health care reform that certainly don’t seem to align with small business interests. For example:

Eli Lilly (the 10th largest pharmaceutical company in the world)

The Federation of American Hospitals

The Self-Insurance Institute of America

Financial Executives International (79% of members are CFOs of companies with $50 million or more in revenue)

And Ogilvy (“one of the largest marketing communications networks in the world”)

The NFIB was instrumental in killing health reform in 1994, but has pledged to work toward a solution this year. I have messages into the group asking how some of the unusual coalition members above represent the interest of small business owners in the health care debate. I’ll update with their response when we get it. [See update below.]

It’s clear that no one group speaks for all 27 million small businesses in America on any issue, especially one as contentious as health care reform. It’s also clear that political and business interests on both the left and the right like to claim that whatever policy they favor is best for small business owners.

This is just posturing that avoids the actual issues that matter to business owners: how to control rising health care costs, whether there should be a public insurance option, and how any mandates to provide coverage will affect small employers. Any process to pass health care reform is going to be messy. Let’s at least have a discussion on the merits.


The NFIB’s Stephanie Cathcart emails the following in response to my questions:

1. NFIB helped to put together the coalition around 7 or 8 years ago (some remember it loosely existing as long ago as ’95 working on the Fawell AHP bill). It was originally formed around the AHP initiative but now advocates on larger healthcare reform initiatives, with the mission of seeking affordable healthcare for small businesses. NFIB has equal membership as anyone else in the coalition.

2. The coalition is funded by equal membership dues (I think it’s only $500/year).

3. Eli Lilly is actually not a member anymore and I’m not sure why Ogilvy is on there (but thanks for catching). We just changed our hosting company and re-built our entire web site so some things are carried over from the old site (that we are still updating). [Americans for Tax Reform] and Federation of American Hospitals are still members and, along with our more than 160 member groups, support the goal of increasing small business access to quality, affordable healthcare (there’s probably some cross membership in there, I would guess).

Reader Comments

Steve King

July 7, 2009 03:51 PM


Any idea who is behind Small Business Majority and Main Street Alliance? I looked at their websites, but didn't learn a whole lot.

The bios on the Small Business Majority site look quite impressive. The Main Street Alliance site has less info.

I didn't see information on either site on their funding sources.

Both groups look like they have done some interesting stuff, it would be nice to know more about them.


Medical Insurance

July 8, 2009 12:21 PM

As the nation is engaged in overall health care reform a focus on making sure small businesses are able to receive affordable medical insurance is being called a top priority at a joint press conference with the National Federation of Independent Business and (NFIB) and America’s Health Insurance Plans (AHIP)

On the accessibility of affordable health coverage, Dan Danner, the CEO and president of the NFIB stated his thoughts on the importance of this matter, “We must work together to pursue creative, private market solutions to what has become an unsustainable problem for small businesses – increasing small group health insurance costs.” He continued by adding, “It is imperative that insurance market reform – specifically in the individual and small group markets – leads to greater access to larger pools, increased portability and competitive choices.”

The AHIP conducted a nationwide tour of the United States to get opinions and stories directly from the American people in regards to their experiences with health care institutions. The people with whom they talked to were also asked for their ideas for health care reform. During their conference the AHIIP released their findings to the joint committee.

In 2008:
· Small group health insurance premiums averaged $913 per month for family coverage and $346 for individual coverage.

· Health insurance premiums ranged from as low as $198 a month in Washington to $504 a month in Alaska.

· Companies with more employees generally paid less then companies with fewer employees.

· Forty-one percent of businesses had an HMO plan, 50% had a PPO and only 7% were enrolled in heath savings plans in 2008.

The AHIP released a statement highlighting the specific needs and obstacles faced by small businesses, calling policymakers attention to difficulties faced by small businesses.
Under mounting reform pressure, the health insurance industry offered Tuesday for the first time to curb its practice of charging higher premiums to people with a history of medical problems.

The offer from AHIP and the Blue Cross and Blue Shield Association is a potentially significant shift in the debate over overhauling the nation's health care system to rein in costs and cover an estimated 48 million uninsured people. It was contained in a letter to key senators.

In the letter, the two insurance industry groups said their members are willing to “phase out the practice of varying premiums based on health status in the individual market” if all Americans are required to get coverage.
“The offer here is to transition away from risk rating, which is one of the things that makes life hell for real people,” said health economist Len Nichols of the New America Foundation public policy center. “They have never in their history offered to give up risk rating.”

“This letter demonstrates that insurance companies are open to major insurance reform and are even willing to accept broad consumer protections,” said Sen. Jeff Bingaman, D-N.M., a moderate who could help bridge differences on a health care overhaul. “It represents a major shift from where the industry was in the 1990s during the last major health care debate.”


July 8, 2009 02:56 PM

Re: Steve

Small Business Majority is a national, nonpartisan, nonprofit small business advocacy organization focused on healthcare reform. We conduct scientific polling of small business owners across the country to ascertain their views; in June, we released an economic analysis of the potential impact of healthcare reform on small businesses. The analysis was based on a microsimulation model developed and run by an MIT economist. Any positions we take are based on this research.

Our leadership, senior managers and board members are all former business owners. Our funding comes from nonprofit foundations, not political organizations. We are based in Sausalito, CA, with offices in Washington DC and New York City, and work with small business owners, healthcare policy experts and elected officials nationwide.

When it comes to healthcare reform, we support bipartisanship and are working closely with major business organizations across the political spectrum to set aside long-held agendas and focus on real, pragmatic nonpartisan solutions.

Our most recent research (derived from polling randomly selected business owners in 16 states across the nation) indicates the majority of small business owners support reforming the healthcare system using a shared responsibility model. They believe individuals, the federal government, providers and insurers should work together to fix our broken system.

We believe the number and diversity of small businesses in America deserve many voices representing their interests. There is room for everyone in the small business tent.

Ajax Greene

July 9, 2009 02:49 PM

The time has come to end the NFIB and US Chamber of Commerce claims they speak for the small business community. Their old tired thinking has gotten the country into the mess it is in. There are many voices in the SME market that have a different view of the future. The Social Venture Network, Balle, New Voice of Business, B Lab to name just a few represent a growing wave of business interest that are challenging the status quo in exciting ways.


July 15, 2009 01:41 PM

The Obama administration's plans for health care reform all rely on employers paying for insurance. Where does this leave small business owners who often don't have the money to afford health insurance for their employees? Would a public plan option be feasible for small business owners? Or could small business owners group together to form buying cooperatives to buy into private health care plans?

bill shor

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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