• NASE Releases Micro-business Health Care Survey

• Estate Tax Repeal Dies in Senate

NASE Releases Micro-business Health Care Survey

On Tuesday, the NASE released the results of a survey gauging micro-business attitudes about health care. The survey shows something the NASE has known for a long time -- the state of health care among the nation's self-employed and micro-business is critical. More than two-thirds of micro-business owners say they are unable to afford health insurance for themselves or their employees, according to the "Affordability in Health Care" survey. The study highlights the serious difficulties micro-businesses face regarding health insurance rates that are significantly higher than those paid by larger businesses and coverage options that are much more limited.

Several federal policymakers joined NASE President Robert Hughes to spotlight the dramatic challenges and cost inequities among the self-employed when it comes to health insurance. Chairman of the House Small Business Committee Donald Manzullo (R-IL), Ranking Member Nydia Velazquez (D-NY), Rep. Ernie Fletcher (R-KY), Rep. Kay Granger (R-TX) and Rep. Roscoe Bartlett (R-MD) were all on hand to call for major reforms that would provide a more level playing field for micro-businesses.

"The businesses that can least afford it are paying disproportionately more than bigger businesses for access to quality health insurance," said Hughes. "Finding solutions that provide a fair shake for these enterprises not only is in the best interest of small-business owners; it's in the best interests of the nation as a whole."

At the event, Rep. Fletcher said, "The best patient protection is access to affordable health benefit options. Small firms deserve the opportunity to obtain high quality health insurance that is competitively priced. Congress should pass AHP legislation this year and bring Fortune 500 health benefits to the nation's Main Street small businesses and their employees." Rep. Fletcher is the sponsor of the Small Business Health Fairness Act (H.R. 1774) that provides for Association Health Plans.

The survey found that seven in 10 owners of micro-businesses report that they do not provide any type of health care insurance to eligible employees. Costs are cited as the chief reason for this trend. Participants in the study say the situation is worsening as health insurance premiums for micro-businesses increase at double-digit rates while insurance benefits and plan choices decrease. For more survey results, read the NASE's press release.
 

Estate Tax Repeal Dies in Senate

In a major blow to micro-businesses, last week the Senate voted against permanent repeal of the estate tax. Under President Bush's tax relief package that passed last year, the estate tax will be phased out in ten years, when a sunset provision will force it back to 2001 levels. A majority of the Senate -- 54 of 100 -- voted in favor of repeal. However, a Senate point of order mandated that 60 votes were needed to pass H.R. 8.

In a statement after the vote, President Bush said the bill's failure is "a disappointment to the American people. The Congress must fix this unfair tax and provide families with certainty so they can plan for the future." Bush also said, "It is wrong that, as a result of a quirk in the law, millions of American will be subject to the death tax beginning at the end of the decade."

While Senate Majority Leader Tom Daschle (D-SD) suggested last week that he does not intend to schedule another vote on the estate tax repeal, the NASE is continuing efforts to raise the exemption limit to $5 million in order to provide relief for the nation's micro-businesses.

The repeal of the estate tax is a legislative priority for the NASE. The estate tax is not only debilitating to a small business when its owner has passed away, but the money that the owner must spend to prepare for the estate tax is also a burden that drains business resources. Money spent on estate tax planning measures could have been reinvested into the company. Moreover, estate tax liability considerations frequently affect business decisions about investments and expansions. It is for this reason that Congress must either raise the exemption to $5 million or permanently repeal the estate tax.
 

Do any of these issues affect you? Visit the NASE's Legislative Action Center  and "Tell Your Small Business Story." This will help the NASE understand - on a personal level - how key legislative issues are affecting your business and your bottom line.

For more information about any of the articles in Washington Watch, contact Maureen Petron, NASE public affairs manager, at (202) 466-2100 or mpetron@nase.org.