STATEMENT
of the
Honorable Nydia M. Velázquez, Chairwoman
House Committee on Small Business
Hearing on Challenges and Solutions to Health Insurance Coverage for Small Businesses
March 14, 2007

As just about every employer and employee knows, there are few issues of greater importance than access to health care.   But in today’s market, more companies, particularly small businesses, are finding it difficult to offer health coverage to their employees. The challenge of providing coverage not only undermines the wellbeing of millions of Americans, it also threatens the growth of small business and our economy. 

If the American health insurance system is at a crossroads, small business is at its center.  Entrepreneurs will tell you that this is the number one issue they face.  And, unfortunately, this problem is getting worse.  Every year, the number of employers offering coverage continues to decrease.

According to a Kaiser Commission on Medicaid and the Uninsured, between 2001 and 2005, the number of workers receiving coverage through their employer decreased nearly 4 percent (81.2 percent to 77.4 percent).  More than half of this decline was attributed to companies terminating insurance coverage. 

This committee’s goal will be to ensure that health care reform does not occur without meaningful consideration of how it impacts small business.  Simply put, any reasonable strategy to expand insurance coverage must give serious thought to the challenges faced by small firms.   

Today’s hearing is the first in a series for the Small Business Committee—we will be looking at the ways Congress can address the problems in the small business health insurance arena.  Over the years, there have been a variety of approaches to reducing the number of uninsured that have been passed into law.  We have seen the expansion of the Medicaid program, pools to help high-risk populations, as well as programs to provide health care for those laid off due to trade agreements.  However, there have been no meaningful changes to fix the small-group market. 

While states like Massachusetts and California are starting to take action on their own, I believe that there are changes at the federal level that can help improve the health insurance market. 

A number of committees will be looking at the problem of health care coverage in the 110th Congress; my focus is to make sure that the small businesses are part of the debate.  We cannot have a discussion on reducing the uninsured without helping the 23 million Americans without health insurance who work at, own or have a family member working at a small business.

In my opinion, any solution to America’s healthcare crisis can only take shape in light of an open dialogue with all interested parties.  The panel before us will allow the committee to do that.  We must understand the challenges before small business and more importantly we must understand how the insurance market works. 

We have with us today an impressive group of witnesses, well-equipped to help us identify the reasons employers are finding it difficult to offer coverage.

This is why I am so pleased that representatives from the small business community, health care experts as well as the insurance industry.  While I know there may be differences of opinion on the best way to solve the problem, I think everyone will agree that the current system is broken.

I look forward to today’s testimony on possible alternatives and practical solutions that may go beyond the particular perspective of the constituency that you represent.  My hope is that we can hear about some common ground on these issues that will help us move forward with meaningful solutions