Upholding Law on Employer-Sponsored Health Coverage Could Affect Relationships Between Politicians, Business Community
If SB 2 is upheld on the Nov. 2 statewide ballot, a long-standing "stalemate" between politicians who advocate mandating employer-sponsored health coverage and the business community could be overcome, the Contra Costa Times reports (Silber, Contra Costa Times, 10/26). Under Proposition 72, California residents can vote "yes" to uphold or "no" to repeal SB 2, a state law that will require some employers to provide health insurance to employees or pay into a state fund to provide such coverage.
SB 2, which is scheduled to take effect Jan. 1, 2006, would require employers with 200 or more employees to provide health insurance to workers and their dependents by 2006 or pay into the state fund. Employers with 50 to 199 employees will have to provide health insurance only to workers by 2007.
Companies with fewer than 20 workers will not have to comply with the law, and the law also will exempt employers with 20 to 49 workers unless the state provides them with tax credits to offset the cost of health coverage (California Healthline, 10/25).
According to the California HealthCare Foundation, 95.5% of employers with at least 50 workers and 98.8% of businesses with more than 200 employees already provide health coverage. However, under SB 2, many businesses would have to increase their contributions to health care costs because only about 75% of employers cover at least 80% of premiums, as the law requires.
Since the 1940s, "every effort in California to expand health care coverage through the workplace has failed ... leaving most politicians scared of any approach that would force more businesses to pay for health coverage," according to the Times.
Larry Levitt, a vice president of the Kaiser Family Foundation, said, "In many ways, the symbolic value of Prop. 72 is at least as big as how many people will get coverage," adding, "It sends a really strong signal to the rest of the country that a major initiative in health care is possible" (Contra Costa Times, 10/26).
SB 2 has "drawn heated opposition from much of the state's business community," which says the law would cause "higher prices and lost jobs without controlling health care costs," but the law has found "at least a few supporters among owners of the state's 1.1 million businesses," the Stockton Record reports.
Spencer Karpf, owner and CEO of Software Management Consultants, said, "Proposition 72 says each employer will take responsibility. That levels the playing field for everybody."
Barry Hermanson, who owns a temporary worker agency in San Francisco, said the measure would assist employers that already pay for extensive health care coverage and ease the impact of uncompensated emergency department care for the uninsured on the state and local government budgets (Lawrence, Stockton Record, 10/25).
In an article examining the Los Angeles Free Clinic, the Los Angeles Times reports that regardless of the outcome of Proposition 72, "the discussion has opened a view into a growing distinction riving American society: not wealth disparities or the digital divide but access to health coverage" (Stewart, Los Angeles Times, 10/25).
Additional information on Proposition 72 is available online.