Now Is the Wrong Time to Increase Health Insurance Costs

Small Business

The following opinion article first appeared in the Connecticut Post and other Hearst Connecticut Media newspapers. It was written by CBIA president and CEO Chris DiPentima.

State lawmakers and the Lamont administration have introduced proposals that would impose a new tax on the healthcare coverage purchased by working-class families, including small business owners and their employees, across the state.

Following the introduction of the proposed tax in the Senate, lawmakers hastily scheduled a hearing just a few days later, arguing that this tax would make healthcare more accessible and affordable for underserved communities. However, by pushing through this rushed proposal, lawmakers fail to realize the unintended consequences of their own bill—increasing health insurance costs for many people most impacted from COVID-19’s financial hardships, as well as the many small businesses hardest hit by the pandemic.

By taxing local business owners, legislators and the governor are missing the fact that our state’s local coffee shops, the corner grocery store and your trusty car mechanic are going to have to cough up additional funds if they want to continue providing health coverage. This tax will add more hardship to local businesses who are already struggling through the global health crisis that has devastated our state. And for small employers currently not required to offer employer-sponsored healthcare, this measure will discourage them from doing so.

Extra Tax

There are a few alternatives, of course, if these small businesses cannot afford to pay this extra tax.

First, they could offload the extra cost of the tax onto their workers themselves. That means local business owners, who are proud to provide for their employees, will be forced to ask their employees to pay even more for their insurance coverage.

The second option is for small business owners to stop offering health coverage altogether. If local employers are no longer able to offer benefits and care to their employees, is that really helping our state recover, and are we really protecting the health and well-being of our population?

It’s unfair to submit local businesses—and their workers and families—to a new tax on their health insurance, especially as small businesses fight to recover from the pandemic. It’s even more unreasonable to do so when so many working people rely on that insurance coverage for COVID-19 testing and quite possibly COVID-19 treatment.

State Fees, Taxes

If the state legislature and the administration truly want to expand healthcare coverage and make it more affordable—and that is a noble and worthy goal—then why does this policy do the exact opposite? At a time when state government fees, taxes, and assessments already add $591 to the annual cost of a fully insured plan, shouldn’t the state focus on making those plans cheaper, not more expensive?

Simply put, a new health insurance tax will make healthcare coverage more expensive for Connecticut small businesses and the working class. And that would be irresponsible—for elected leaders to not only put this tax on the backs of local businesses and working families, but also to rush this legislation through without allowing those who will be most affected ample time to weigh in.

Our state’s elected leaders should stay focused on helping local Connecticut businesses recover from this devastating pandemic. And if the governor and state legislators are truly committed to expanding healthcare access, they should do it through policymaking that benefits everyone who needs health coverage, not just for one population at the expense of another.


Leave a Reply

Your email address will not be published. Required fields are marked *

Stay Connected with CBIA News Digests

The latest news and information delivered directly to your inbox.