Obama Makes Suggestions on Health Care Reform

June 4, 2009 (PLANSPONSOR.com) - In a letter sent Tuesday to Senator Max Baucus (D-Montana), the chairman of the Finance Committee, and Senator Edward Kennedy (D-Massachusetts), the chairman of the Health, Education, Labor and Pensions Committee, President Obama wrote that if the committees decide to require employers to provide health insurance coverage, such a mandate should not apply to small employers.

Obama said in the letter that “small businesses face a number of special challenges in affording health benefits and should be exempted,” according to Business Insurance. In addition, Obama suggested that if the committees mandate that individuals must have health insurance coverage, hardship waivers should be provided to those who cannot afford the coverage.

In letting the Senators know where he stands, Obama said employees and others should be allowed to retain their existing coverage, but a health insurance exchange should be established where individuals could shop for coverage. Business Insurance reports that the president also said he would support establishing a public health insurance plan that would operate alongside private plans.

That would give individuals “a better range of choices, make the health care market more competitive, and keep insurance companies honest,” he wrote, according to the news report.

Legislation being worked on this week by Kennedy’s committee reportedly includes all of the elements mentioned in Obama’s letter except perhaps the exemption for small businesses (see Kennedy Health Reform Measure Mandates Employer Coverage Contribution ).

Baucus’ committee is considering the tax treatment of employer-sponsored coverage (see “Change” May Include Employer-sponsored Programs ). In testimony during a Finance Committee hearing, at least one witness implored the committee to change, but not drop, the employer health coverage tax break (see Change – Don’t Drop – Workplace Health Tax Break ).

Lawmakers from both sides of Congress have already introduced legislation they claim “equalizes” the tax treatment of health care (see Lawmakers Claim to ‘Equalize Tax Treatment of Health Care’ in New Proposal ).