Wednesday, May 10, 2006

Fair Share: Correcting a Misunderstanding

Richard Frederick, an executive from Autotask, a software company in the Capital Region, writes in a letter published today in the Times Union:
The cost of providing health insurance to our employees continues to rise at double-digit rates. We now pay more than $1,000 per month for family coverage. Our company believes that it is our responsibility to provide this coverage for our employees. Why tax us when we already are providing this coverage? Go after the bad guys. I suggest that companies doing business in state either provide coverage or pay the taxes as proposed, but do not require companies that are already providing coverage to pay twice.
Mr. Frederick is exactly right that the problem is "the bad guys" who aren't providing health insurance. But his firm will not be subject to a tax, fee, assessment or any other charge if his firm is, as he suggests providing decent benefits.

Under the Fair Share for Health Care Act, the only firms subject to any kind of charge are those that pay voluntarily instead of providing decent benefits to their employees.

So, in fact, the legislation operates exactly as Mr. Frederick wishes.

4 comments:

Ann On said...

So are you guys going to reach out to his firm to clarify? We can't assume he is reading the WFP blog. Guys like him should be reached out to even one-by-one and brought in to the coalition.

Maybe he can send another letter to the editor correcting the misinterpertation and asking other business leaders to sign-on!

Alex Navarro said...

Yes, I emailed Mr. Frederick. Haven't heard back.

ASN

Will said...

"Under the Fair Share for Health Care Act, the only firms subject to any kind of charge are those that pay voluntarily instead of providing decent benefits to their employees."

Is this worded right? Only Firms that pay voluntarily are subject to charges?

That looks mixed around.

Alex Navarro said...

Hey Will,

Maybe I wrote too quickly in the post above.

Here's the way it works: If a business provides decent benefits, they don't pay a fee, a charge, an assesment, nothing, to the state.

If a business chooses to provide less than decent benefits (defined in the current draft of the bill as $3.00 per hour), then they do pay an assessment equal to the difference between their expenditure and $3.00 per hour.

So, for example, if a business provides $2.50 per hour (on average) in benefits, that business would pay a $.50 per payroll hour assessment to the state.

But that's one crazy business: They could provide a (statutorily defined) decent level of benefits, get a better workforce, more productivity and less tenure -- but instead they have chosen to provide inferior benefits and pay the assessment.

In practice, no covered firm would make that choice.

Hope that's clearer.

ASN