Few issues are as important to U.S. businesses right now as the skyrocketing cost of health care, which has been rising on average 10 to 12 percent a year for the past decade.
"The business community has been calling for health care reform for many years in a row now," says Bruce Josten of the U.S. Chamber of Commerce. "We are desperate to get health care reform; we think it is absolutely essential and necessary."
Josten's organization has a long wish list of things it wants to see the government do to control health care costs, including wellness programs for employees and requiring all workers to participate in insurance programs. But the Chamber of Commerce has also come down squarely against some key provisions in the bills being championed by Democrats. It doesn't want the government to require employers to insure their workers. It also opposes a public insurance plan that would compete with private insurers.
"We are objecting to the concept of a government-run public plan because it will operate on an uneven playing field," Josten says. "It will have an unfair advantage over private plans."
Criticism Of Public Plan
Business groups complain that a public plan would have a cost advantage. It could set rates so it could require doctors and hospitals to accept less for treatment, the way it does with Medicare. Many private insurers would leave the market, making the government plan dominant.
With Washington making health care decisions, businesses fear they would have even less leverage over costs.
Helen Darling, president of the National Business Group on Health, says the plan puts another 46 million people into a program that will shift costs to employers.
"That's not an even remotely satisfactory solution," she says.
In the past, opposition from business groups helped thwart the health care ambitions of Democrats. Business lobbies have already begun funneling money into ads opposing the public health care option. They will run in five states with moderate senators whose votes are pivotal to getting health care legislation passed.
Some Support From Individual Companies
Paul Fronstin of the Employee Benefit Research Institute says opposition isn't uniform among individual businesses. Many companies are still studying the issues.
"They generally take a wait-and-see attitude, and they don't rush into decisions when it comes to their workers and the benefits they provide," he says.
Wal-Mart, for instance, says it supports the idea of an employer mandate.
John Oliver, a spokesman for the retailer L.L. Bean, says his company hasn't made up its mind but is open to the idea. L.L. Bean provides health care to all its employees, which is costly, he says.
"To the extent that the coverage reaches more Americans, it would have a positive effect on the cost burdens we are carrying," he says.
Oliver says the state of Maine, where his company is located, has tried to address health care costs without success. Many businesses know keenly that federal help is needed.
"While they care about the details of how federal reform is structured, they are looking to Washington to address a problem that the state alone cannot resolve," he says.
Oliver says his company is also open to a public health care plan depending on how it is designed. That view is limited right now and much of the business lobby remains opposed. But proponents are hoping that enough high-level defections could at least change the tone of the debate.