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Press Release


Date:February 2, 2009
Contact: Jeff Leland


Employer Alliance: New York Budget Proposals Damaging to Small Business


Budget proposals promoted by Governor Paterson and being considered by lawmakers include onerous increases to the taxes on health insurance, which would be another hit to business struggling to afford and offer health insurance coverage, according to the Employer Alliance for Affordable Health Care.

“We all recognize the difficulties of our current economy,” said Jeff Leland, chair of the Employer Alliance. “However, hitting businesses with higher health care taxes, and potentially adding to New York’s problems by causing more New Yorkers to become uninsured, is not the answer.”

Noting news reports saying lawmakers hoped to act this week on a deficit reduction package to address the gap in the current (2008-09) fiscal year, the Employer Alliance urged the legislature to reject the increased health insurance taxes and, instead, look for ways to make health insurance more affordable.

“Federal lawmakers are working on economic stimulus legislation that would bring a much needed financial ‘shot in the arm’ to New York. Some of these dollars could be used to off-set the proposed increases in health care taxes,” said Leland. “State lawmakers should not act on a deficit reduction plan until they know what the impact of the federal stimulus package will be here in New York.”

Governor Paterson’s budget deficit reduction proposal calls for increasing in the Covered Lives Assessment — a surcharge paid on every health insurance policy — as well as other health insurance taxes such as the patient services surcharge and the section 332 assessments. Adding insult to injury, according to the Employer Alliance, money raised by the increase in the section 332 assessments is proposed to be used to pay for various health care programs including the state’s $100 million subsidy to small businesses to cover the cost of Timothy’s Law (mental health parity).

“The state promised to protect small business from the higher cost of coverage imposed by Timothy’s Law. Now it’s breaking that promise,” Leland said.

The Employer Alliance for Affordable Health Care is a coalition of more than 3,400 employers and individuals from across New York, representing more than 200,000 working New Yorkers, committed to preserving quality affordable health care.