The health care debate hit a speed bump on Capitol Hill last week as policy makers tried to get their arms around the trillion dollar price tag of the President's plan.  Slowing down the process is not a bad thing, change this big is going to require more thought, debate and input from the people who are going to be most impacted including consumers, small businesses, medical professionals, insurance carriers, and large companies.

In an effort to prop up the President's plan to provide health care coverage for all, through a massive government run system, MIT economist Jonathan Gruber released a study that argues the President's government run plan will benefit small to midsize businesses http://www.smallbusinessmajority.com/.

He makes some good points that health care reform will likely reduce costs for small businesses, enable them to create more jobs, pay better wages and invest more of their money into the company.  Those are all outcomes that should be part of any health care reform package.

However, there are a few big flaws in Dr. Gruber's plan.

First, his study is focused only on a nationalized health care system – it does not look at the value or benefits of a competitive system where individuals have greater choices and providers are competing for business.

Second, his claim that a government run health care system will reduce cost for small businesses is off the mark.  It may reduce costs for companies already providing healthcare but for those small businesses who can't afford to provide coverage their costs will increase significantly.

And, finally, it is not clear who is going to pay for the massive health care reform package.  With the desire to provide coverage for the uninsured, someone is going to have to pay the bill and it is likely to come out of employers pockets – no matter how big their business.

There is no debate that we need to reform our health care system.  But the reforms being pushed by the President and Congress will move our system closer to that of Canada and Great Britain leading to fewer choices and limited access.  And, it will cost our small businesses more not less.

3 Responses to “Gruber’s Health Care Study Claims Government Run Heath Care will help Small Business?”

1. Frayda Levy Says:
   June 23rd, 2009 at 3:44 pm

   The claim that reforming health care will enable to be more competitive ignores the European experience. European countries all of have some form of nationalized health care. Yet, their economic growth rates has been about half — or less than the US. Plus, unemployment in European nations is far higher than what it has been in the US.

   So one can only conclude that if the US is to “reform” health care along the lines of what the Europeans did, we will experience higher unemployment — and lower economic growth than we would with our current health care system.

2. Lisa Dolan Says:
   June 24th, 2009 at 8:37 am

   Government run programs are fraught with absurd waste as can be seen from the Medicaid program and many other government run programs currently in place. There is very little, if anything at all, that the Government is in charge of that actually results in a savings. We are kidding ourselves if we think that nationalized health care is the answer to this problem. It doesn’t work in Europe why would it work in the States? Have you ever heard of anyone here in the states when diagnosed with cancer, going off to Europe to be treated? In fact, it is the other way around. The government run healthcare will result in a bureaucratic and wasteful program. I believe strongly that we need to reform healthcare, however a government run healthcare is not the answer and will most certainly end up hurting small business which will result in hurting the economy more.

3. Nina Rosenwald Says:
   June 29th, 2009 at 9:52 am

   It won’t – and healthcare will be rationed to owners AND employees– IF and when they need it…

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