Research Briefing

ObamaCare Makes Business Scream: “The More I Hear, The Crazier It Makes It.”

OBAMACARE’S “BIZARRE TAXES” ARE UNAFFORDABLE FOR SMALL BUSINESSES AND WILL PREVENT JOB CREATION, KILL EXISTING JOBS

President of Straight Arrow Insurance Services In Reno, NV Says “So Much Of [ObamaCare] Falls On Small Business.” “Leslie O'Day, president of Straight Arrow Insurance Services, was concerned about the reforms' dizzying breadth. ‘The more I hear, the crazier it makes it,’ she said. ‘There's no incentive to buy insurance until you need it with those penalties. ‘Businesses need to start tuning in. So much of this falls on small business. Employers need to start understanding this.’” (Bill O'Driscoll, “Memo To Small Businesses: Start Paying Attention To Healthcare Reform Now,” Reno Gazette-Journal, 5/16/10)

“One Of The More Bizarre Taxes That Will Affect Individuals This Year Is The Indoor Tanning Services Tax.” (Ray Martin, “Health Care Reform: Changes For Seniors And Small Business Owners,” CBS’s “Money Watch” Blog, 5/17/10)

Owner Of Six Tanning Salons In Pennsylvania Says He Can’t Afford ObamaCare’s Tanning Tax. “Miller is the owner of Sun Your Buns, a group of six Erie-area tanning salons. … Miller, meanwhile, is worried about what it might mean to his business, which employs about 35 people who oversaw about a quarter-million tanning sessions in 2009. Miller said he can't afford to offset the 10 percent tax, but he is hoping to ease some of his customers' pain by giving them extra tanning time for their money.” (Jim Martin, “Erie Tanning Salon Owners Worry About Impact Of Tanning Tax,” GoErie.com, 5/16/10)

• Miller: “We Are Certainly Not Hiring Any New Employees… If The Tax Kept Some People Away From Our Salons It Could Affect The Employment Of Some People. Let's Say 25 Percent Of The People Quit Coming In, You Don't Need As Many Employees.” (Jim Martin, “Erie Tanning Salon Owners Worry About Impact Of Tanning Tax,” GoErie.com, 5/16/10)
• Miller: “I Also Think This Thing Was Just Ramrodded To The Extent That People Didn't Know What They Were Voting For.” (Jim Martin, “Erie Tanning Salon Owners Worry About Impact Of Tanning Tax,” GoErie.com, 5/16/10)

Another Pennsylvania Tanning Salon Owner Says The Tax Will “Obviously… Affect Business And It’s Not Going To Be For The Better.” “Kim Glancy, owner of A Total Tan on East 38th Street, expects her business will survive, but she certainly doesn't expect it will improve. ‘I am not happy about it,’ she said. ‘Obviously this is going to affect business and it's not going to be for the better.’” (Jim Martin, “Erie Tanning Salon Owners Worry About Impact Of Tanning Tax,” GoErie.com, 5/16/10)

AND SOME SMALL BUSINESSES STILL WON’T BE ABLE TO AFFORD HEALTH INSURANCE FOR THEIR EMPLOYEES

Obama’s Chief Medicare Actuary Predicts 14 Million Americans Won’t Keep Their Current, Employer-Based Coverage, “Partly Because” Companies May Opt To Pay A Fine Instead Of Covering Employees. “But the Medicare actuary, Richard Foster, writes that his projected small overall change masks a bigger loss—balanced by a compensating gain. He predicts that nationally, 14 million people will move out of employer coverage. That is partly because companies will have the option of throwing at least part of the cost of covering lower-income employees onto the government.” (Anna Wilde Mathews, “Workplace Set To Remain Key Source Of Health Coverage,” The Wall Street Journal, 5/17/10)

• Like Small Businesses Who Feel The Pain Of A Down Economy, Higher Health Care Costs. “The biggest test is likely to come with small firms like 460 Machine Co., a machine shop in Prince George County, Va., with five workers. A recent downturn in business, combined with rising premiums, has made it tougher to keep its health plan. Sandra Wallace, vice president of operations, says her insurance broker has predicted double-digit rate increases.” (Anna Wilde Mathews, “Workplace Set To Remain Key Source Of Health Coverage,” The Wall Street Journal, 5/17/10)

Economist At The University Of Minnesota Warns “It Wouldn’t Be So Great” For The Federal Government If Companies Dumped Employer-Based Coverage “Because Of The Budget Strain.” “For many low-wage employees, a pay bump combined with a subsidized health plan bought on their own may be a better deal than a workplace health package, says Brad Herring, an economist at Johns Hopkins University. However, ‘from the federal government's point of view, it wouldn't be so great,’ because of the budget strain, says Roger Feldman, an economist at the University of Minnesota.” (Anna Wilde Mathews, “Workplace Set To Remain Key Source Of Health Coverage,” The Wall Street Journal, 5/17/10)

MEANWHILE, DEMS WHO FLIPPED TO SUPPORT OBAMACARE FACE TROUBLE AS “THE DEMOCRATS’ MOST VULNERABLE INCUMBENTS”

DSCC Chairman Sen. Robert Menendez (D-NJ) Says “Democrats Will Surely Reap Political Benefits” From ObamaCare In November. “Passing affordable, accessible health care for every American was a historic moment for our county — and a monumental achievement for Democrats. … This will not be lost on voters this fall. … [D]emocrats will surely reap political benefits from health care reform this November.” (Sen. Robert Menendez, Op-Ed, “Health Care Enters The Race,” Politico, 5/17/10)

But Dems Who Flipped To Support Obama’s Government-Run Health Care Experiment Are “Among The Democrats’ Most Vulnerable Incumbents.” “They were the difference makers on health care reform: House Democrats who flipped from opposing the plan to supporting it, delivering a win on President Barack Obama’s signature domestic issue. Now, they are also among the Democrats’ most vulnerable incumbents, and none is building a reelection message around their famous vote.” (Josh Kraushaar, “Five Who Flipped On Health Care,” Politico, 5/17/10)

Rep. Allen Boyd (D-FL) Hasn’t “Had Any Specific Events On Health Care Since The Vote” And Neglected To Mention It In Campaign Ads. “Boyd is taking a quieter tack — releasing four campaign ads that never mention the issue of health care. Two ads focus on his efforts to secure funding for veterans’ affairs and improve broadband access in north Florida. ‘We haven’t had any specific events on health care since the vote, but he talks in the community anytime it comes up,’ said Boyd spokesman Aaron Blye. ‘We’ve found that people are really concerned about the economy and jobs right now.’” (Josh Kraushaar, “Five Who Flipped On Health Care,” Politico, 5/17/10)