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December 08, 2005
The Bureau of Labor Statistics' New Data
The Bureau of Labor Statistics released its quarterly findings today in yet another study about the economy. The study seems to refute anybody who claims that small businesses are not important to the economy and gives more fuel to small-business advocates (such as NSBA) who continue their fight to show the Bush Administration why it should pay more attention to small businesses.
Two excerpts:
* "For example, the data show that, from September 1992 through March 2005, firms with fewer than 500 employees accounted, on average, for 65 percent of quarterly net employment growth, representing 13.5 million out of 20.6 million net jobs created by the total private sector."
* "All firm-size classes experienced at least one quarter of negative net employment change related to the 2001 recession, but the larger size classes experienced more quarters of net loss than the smaller classes."
Posted by Bee Line at 04:20 PM | Comments (0)
October 12, 2005
Proposal to Cap Health Insurance Tax Deductions
President Bush's Federal Tax Commission yesterday unveiled their recommendations that include an $11,000 cap on employer-sponsored health insurnace tax incentives.
Currently, there is no limit on the amount of tax deduction a buisness can take on health-insurance for their employees. According to the OMB, that amounted to $112 billion in lost-revenue for the federal government in 2005 alone.
Posted by WorkerBee at 12:50 PM | Comments (0)
October 11, 2005
Fair Tax Gets the Ax
The President’s Panel on Tax Reform killed the Fair Tax at their Oct. 11 meeting. The meeting—-the last before they deliver their findings on Oct. 18-—was presented in a roundtable-type discussion forum. After mulling proposed changes to deductions for employer-sponsored health care and mortgage interest deductions, the panel turned on the Fair Tax.
Ed Lazear, the panel member heading the Fair Tax study group, started off well by listing the positive aspects of a consumption tax: encouraging savings, simplified administration, reduced tax burden, etc. Lazear also presented Treasury estimates of what the consumption tax rate would have to be to replace the government’s current income, a range of 22-26 percent.
Then he woke-up the dozing crowd. According to another set of numbers Treasury had run--figuring that Congress would eventually exempt huge swaths of the economy from taxation—-Lazear announced that the final rate would end up somewhere between 64 and 87 percent. Yes, 87 percent!
Expect to read that in the papers from this point forward.
After the bomb, panel Chairman Connie Mack (R-Fla.) went through the motions of inquiring about Fair Tax administration, but it was clear the game was over.
The President’s Panel on Tax Reform will not recommend a National Retail Sales Tax to replace the current code. While positive changes to the code may still come from the panel, an opportunity for fundamental reform has been squandered.
Posted by at 04:48 PM | Comments (0)
October 10, 2005
The Future of Social Security Reform
In a wide-ranging policy address, President George W. Bush had the following to say about Social Security reform:
"As you know, I’ve advocated the need for people to come together to address the Social Security issue. It’s an issue that’s not going to go away. And I’ll continue to talk about it. There seems to be a diminished appetite in the short-term, but I’m going to remind people that there is a long-term issue that we must solve, not only for the sake of the budget, but, more importantly, for the sake of younger workers who are going to either have to pay a ton of money in order to justify current benefits, or to take a look at the underlying causes of the growth of benefits and do something about it, show some political courage."
Some reporters wasted no time interpreting this as a Bush retreat from reform. Nothing could be further from the truth.
What is true is that Grow Accounts are increasingly being seen as the only way to achieve some form of Social Security reform.
Grow Accounts do not fix Social Security as they don't address solvency. But they may be necessary as a first step down the road to reform.
Posted by at 09:58 AM | Comments (0)
October 04, 2005
Improvements for Health Care Quality
The National Committee for Quality Assurance (NCQA), in conjunction with the U.S. News and World Report released a report announcing improved performance of HMOs. According to The State of Health Care Quality 2005, as many as 67,000 deaths have been prevented over the past six years due to increased reporting and quality standards. Unfortunately, voluntary reporting nets only 21.5 percent of the industry publicly reporting on performance.
Posted by WorkerBee at 09:09 AM | Comments (0)
September 28, 2005
Employer Mandates for Health Insurance?
The Suffolk County (N.Y.) legislature has approved a bill that would mandate large employers to contribute funds to employee health insurance. The legislation calls for $3 per employee per hour to be contributed to a fund that will go toward health insurance.
Though not the first of its kind, this bill would be the first to be enacted if the county executive approves it rather than issuing a veto, which was the case with a similar bill in Maryland.
Posted by WorkerBee at 03:01 PM | Comments (0)
September 13, 2005
Small Business Pension Adoption Down
A report released by the Congressional Research Service finds that employer-provided pension plans are declining in popularity. According to the report, both the number of employers offering plans and employees participating in plans shrank in 2004.
Continue reading "Small Business Pension Adoption Down"
Posted by at 10:23 AM | Comments (0)
Sept. 11 Disaster Loans Misused
In a story reported by the Associated Press, the disaster loans established to help businesses harmed by the Sept. 11 terrorist attacks always were not used for that purpose. In Colorado alone, 411 loans were issued under the Supplemental Terrorist Activity Relief (STAR) loan program administered by U. S. Small Business Administration. Some of the businesses who received the STAR loans include a liquor store, a tire-store chain and a nail salon.
In a terse press release, Senate Small Business Committee Chair Olympia Snowe (R-Maine) stated, "The apparent widespread abuse of loans provided through the Supplemental Terrorist Activity Relief Act is nothing short of an outrage."
Posted by WorkerBee at 09:18 AM | Comments (0)
September 06, 2005
Katrina - The Aftermath
The absolute disaster that is Katrina will affect the activities of Congress for months to come. Adding the hurricane’s effects to an already overcrowded fall schedule will increase the difficulty for legislative successes.
Estate tax repeal, long scheduled for a vote on the Senate’s first day back at work, has been postponed indefinitely; it may be the first of many changes in the coming months.
Calls for aid packages, investigative hearings and possibly a new energy bill will compete with two Supreme Court nominations, appropriations season and the reconciliation process. And let’s not forget about the ongoing Social Security debate or the President’s Panel on Tax Reform slated to drop its recommendations at the end of September.
The coming months will certainly test the elasticity of the projected legislative calendar.
Posted by at 03:04 PM | Comments (0)
August 19, 2005
Health Insurer Will Publish Costs of Procedures
Aetna Health Insurance kicks off a pilot program today in Ohio where they will make public their negotiatied prices with area doctors for meical services. The project has been widely praised as a move toward increased patient involvement in a market severely lacking consumerism. Aetna's president Ronald Williams stated that the project will encourage both higher quality and lower costs.
Hmm... Giving people information to make good decisions. Who knew??
Posted by WorkerBee at 10:10 AM | Comments (0)
July 25, 2005
Rewarding Bad Medical Care
This weekend, the Washington Post started a series looking at the many flaws of the Medicare system. As the article clearly demonstrates, hospitals and health care providers often make more money when they provide worse care. These perverse incentives are not limited to government programs. Fundamentally changing the way that providers are paid for care is a critical component of making insurance more affordable for small businesses.
Posted by Green Hornet at 09:07 AM | Comments (0)
July 19, 2005
Consumer-driven Health Care Gains Popularity
According to America's Health Insurance Plans (AHIP), Health Savings Accounts (HSAs) are seeing sharp increases in enrollment. As of May this year, more than one million people nationwide have enrolled in HSAs, twice the enrollment numbers from September 2004.
Posted by WorkerBee at 09:20 AM | Comments (0)
July 18, 2005
HSAs Continue to Grow
The New York Times published an informative story this Saturday about Health Savings Accounts (HSAs), featuring NSBA Board Member Scott Hauge.
Hauge's company, Cal Insurance and Associates, recent began offering HSAs to its employees and it has done very well.
NSBA supports HSAs and applauds the Times for publishing an insightful piece.
Posted by Bee Line at 11:19 AM | Comments (0)
Hospital Infections Tallied $2 Billion in Pennsylvania Last Year
A new report from the Pennsylvania Health Care Cost Containment Council quantifies the painfully obvious -- medical mistakes cost a LOT of money. Pennsylvania began a pilot program last year to evaluate the cost of hospital-acquired infections, as well as the outcome of establishing quality and reporting protocols.
What did they learn? Nearly 12,000 Pennsylvanians contracted infections during a hospital stay in 2004, costing an extra $2 billion in care and at least 1,500 preventable deaths.
Posted by WorkerBee at 10:17 AM | Comments (0)
July 14, 2005
States Seek Increased Payroll Taxes for Universal Health Care
Currently, 18 states are considering bills that would create a single-payer health care system. The majority of these bills propose to create a state government-run insurance plan funded by payroll taxes and new taxes on income.
Though people's satisfaction with their insurance is decreasing, a Kaiser Foundation poll earlier this year showed that 55 percent of Americans opposed a single-payer health system.
Posted by WorkerBee at 09:03 AM | Comments (0)
July 12, 2005
CBO Estate Tax Report is Bunk
The Congressional Budget Office released a report last Thursday that purportedly shows the effects of the estate tax on family-owned farms and businesses. The report, requested by the Ranking Member on the Finance Committee Senator Max Baucus, also looked at the impact of small increases in the exemption levels.
According to the report, "only" ~1,500 small businesses filed estate taxes in 1999 and 2000.
Do expect this to be widely reported in the press as proof that estate tax repeal is not a small business issue. Do not expect it to be widely reported in the press that the CBO only counted as small businesses affected by the estate tax those who filed a QFOBI deduction.
Yes, the same QFOBI that is considered so onerous to calculate that most CPAs won’t touch it. Aside from undercounting small businesses, the report also totally failed to take into account the cost of estate planning undertaken solely to avoid estate tax penalties.
But perhaps this quote from page three of the report says it best
The variety of definitions and forms of small business that exist precludes a comprehensive examination of the effect of the estate tax on small business.
Thanks for nothing CBO.
Posted by at 10:39 AM | Comments (0)
June 29, 2005
Pay for Performance Could Fix Some Meidcare Problems
Culling a lesson from Economics 101, the federal government may be on to something -- paying someone based on their performance might actually work! Medicare pilot programs have found that pay-for-performance plans can lead to increased quality, and thereby cost-savings in hospitals. Supported by many in Congress, various bills to expand current pay-for-performance pilots are expected to be introduced.
Posted by WorkerBee at 11:13 AM | Comments (1)
SS Reform is Tax Reform?
In public speeches and private meetings, House Ways and Means Chairman Bill Thomas has made it clear that he sees the current Social Security debate as a broader opportunity to address national retirement savings as a whole. Somewhere in the near future, we can expect the chairman to begin pushing for pension simplification similar to the president's ERSA, LSA and RSA plans.
With the postponed tax reform commission's recommendations coming in the near future, one has to wonder how long we'll go before Social Security reform and tax reform become the same issue.
Posted by at 10:29 AM | Comments (0)
June 27, 2005
Social Security Debate Continues
There are many ideas about how to fix Social Security, but NSBA believes all of them must include no increase of the payroll tax. NSBA is part of a growing coalition (CoMPASS), which now includes 350 organizations and counting. The CoMPASS Web site includes a very helpful Frequently Asked Questions page among other great resources.
Posted by Bee Line at 02:42 PM | Comments (0)
June 21, 2005
Estate Tax Repeal is Good for the Environment
Well, it's good for the old growth small business environment anyway.
The Senate today added to the evolving energy bill, H.R. 6, language hammered out by the Finance Committee that provides for all tax policy changes related to the energy bill. Included in the amendments proposed for the tax package was an amendment by Majority Leader Frist that called for the full and permanent repeal of the estate tax.
While the amendment never got a vote, we're with the majority leader all the way. Tax vehicles are scarce this summer. He's got the right idea; watch the energy bill for much-needed permanent Death Tax relief.
Posted by at 04:00 PM | Comments (0)
A Disturbing Trend
The Washington Post reported this morning that health care costs continue to soar--health expenditures are now going up four times faster than wages. While this is not a news flash, it does reinforce that health care reform is now more important than ever. The fact is that many who can afford health insurance choose not to get it, but others who want health insurance can't afford it. We need major reform. Urgently.
Posted by Bee Line at 12:17 PM | Comments (0)
The Momentum Builds. . . .
Yet more evidence of the growing consensus behind reforming health insurance by reforming the tax code. Recent remarks by House Ways and Means Committee Chair Bill Thomas suggest that he is fully on board with these ideas, as well. By the way, it's worth noting that the same goal could be achieved through adoption of the Fair Tax, which replaces the current federal tax system with a consumption tax.
Posted by Green Hornet at 09:29 AM | Comments (0)
June 20, 2005
August Too Hot for Tax Panel
We’ll now have to wait two more months to hear recommendations from the President’s Panel on Tax Reform. An Executive Order handed down from the White House changes the due date from July 31 to September 30. While panel members say they don’t need the extra time, they’ll probably take the hint. What will two months get us? Apparently the White House believes that’s enough time to find a resolution to the Social Security debate and create a new energy policy.
Well we’re all for it. Take the extra time to send your sugggestions to the panel. Besides, it’s more like a one month extension – who works during August in D.C. anyway?
Posted by at 04:58 PM | Comments (0)
Should Small Businesses Be 'Operating Like the Big Guys?'
Interesting column by Mason Kauffman about outsourcing. While his ideas are good ones for small business, the headline of the story uses the phrase "operating like the big guys." While this might be true in this case, should small businesses be operating like the "big guys?" Or should there be one standard for all?
It seems that small businesses have been forced to play by different rules -- and that is at the root of some of the problems faced by small business owners today.
Posted by Bee Line at 03:40 PM | Comments (0)
Who Says Your Business is Small?
Making the front page of the Washington Post business section this weekend, SBA continues its search for the truth. Relax "X-Files" fans, no smoking man here. Playing host to 80+ witnesses, SBA continues to slog through the public hearing process. Hot topic of the day: language that would allow large Venture Capital firms to participate in the SBIR program.
Posted by WorkerBee at 03:13 PM | Comments (0)
Right Thinking on Health Care
As you can see in an excellent column by Jeff Jacoby in this past Sunday's Boston Globe, more and more opinion leaders are finally figuring out the fundamental problem with our health care system: federal policies (mostly tax policies) have lead to a market that doesn't work. The changes advocated by Jacoby are a cornerstone of NSBA's own far-reaching health care proposal. About the only good news on the health care front is that the momentum for reform appears to be flowing in this direction.
Posted by Green Hornet at 02:40 PM | Comments (0)