Small Businesses

Utah small business offers health benefits to attract good employees, but costs keep skyrocketing…

Contractor offers employees health insurance but struggles to compete

For 35 years, Fred Ochsenhirt has owned a small drywall and contracting business, Ochsenhirt Drywall and Construction. He feels strongly about providing a health insurance benefit to his 4 employees, even though very few of his competitors do the same. As premium costs escalate, he’s finding it harder to compete in the bid process for contracts because his business costs are higher.

“I provide health insurance” says Fred, “but it’s a big challenge to compete with companies that don’t.” The slow-down in construction over the past year has significantly reduced the amount of drywall work available, making it even more difficult to cover the employer portion (50%) of the company’s monthly premium.

Because there are so few individuals in this company’s health insurance group, a significant health claim by any one employee or dependent causes huge increases in the overall premium. At the last renewal, premiums rose 20%, and coverage for a family with children now costs more than $1200 per month. Even with premiums that high, the employees have had to fight with the insurer to pay claims. “It’s hard to find good insurers. Not many insurance companies are interested in a group as small as ours,” says Fred.

A Policy Solution: Enact Health Reforms This Year

Utah small business owners have spoken in unambiguous terms about the need for comprehensive health reforms. As the economy falls deeper into recession, the urgency for reform grows stronger. Sixty four percent of Utah small business owners say health reform is important to getting the economy back on track.

Congress and our state legislature need to enact health reforms this year that bring stability and peace of mind to Utah small business owners. Sixty eight percent of our small businesses agree that the state and federal government must be partners in reforming health care. Small businesses are the foundation of our economy. They cannot lead the way to economic recovery—as they must—without immediate, lasting relief from rising health care costs.