A bill sponsored state Representative Hugh Holliman would give employers less than 25 employees a maximum of $400 in tax credits for each employee that was given health insurance, according to the Triangle Business Journal. However, with annual employer health costs ranging from $3,024 to $4,971, it is unlikely to have any significant effect, according to fiscal researchers.
The move seems to be a compromise, with another proposal in the state Senate stalling because of a high price tag. The Senate bill would give $700 in credits, and would cost the state $204 million in the first year, according to the Journal. Holliman’s plan would only cost $21.5 million in the first year and $48 million in the second. Holliman’s plan would also take the credits off the company’s income or franchise tax and would limit the credit to 50% of a company’s tax liability in any year. Unused credits could be carried forward for five years.
Multiple groups, including the North Carolina Association of Health Plans – which includes such insurers as Blue Cross and Blue Shield, and Cigna – are behind the plan, touting it as a way to shrink the number of uninsured workers in the state.
However, with the price tag on health care so high, it is unclear how much the move will affect employee coverage. According to fiscal researchers cited by the Journal, the bill would only increase the number of insured workers by 10% from the current 31% of small-company workers who are covered.