WASHINGTON — Congress' attempt to overhaul the nation's health care system has failed its first checkup by the supermarket industry.
H.R. 3962, dubbed The Affordable Health Care for America Act, would be anything but affordable for many food retailers, according to Leslie G. Sarasin, president and chief executive officer, Food Marketing Institute.
“We need a bill, but not this bill,” Sarasin said in a letter to House Speaker Nancy Pelosi, D-Calif., shortly before the House passed the legislation by a narrow margin last week. “H.R. 3962 contains a number of provisions that impact unique aspects of the food retail and wholesale industry and will actually make it more difficult to provide quality health care.”
Among the problems FMI sees with the legislation are a requirement that employers provide immediate coverage for both full and part-time workers, and provisions that would nullify existing health care benefit contracts for retirees.
“The requirement to immediately and automatically enroll employees into health benefit plans will increase the cost of benefits available to our long-term workers, as well as impose significant administrative burdens to enroll and de-enroll associates who decide in a short time that the grocery business is not for them,” Sarasin wrote in the letter.
Frank DiPasquale, executive vice president of the National Grocers Association, based in Arlington, Va., agreed.
“What is concerning are the punitive measures that affect employers,” he told SN last week. “Specifically, mandating that employers pay 72.5% of the cost of health care for every employee, 65% for their families, or pay an 8% payroll surtax.”
If health care costs continue to rise, employers could be forced to stop offering health care and accept the surtax, he explained.
“Somewhere, businesses will have to make a decision about whether they want to drop health care altogether,” he said. “Do we want to encourage employers to drop health care because of these mandates?
“On that point alone, it is very troublesome,” DiPasquale said of the House bill.
He also said NGA was disappointed that the bill did not make reference to retail health clinics, which he said have been valuable in reducing health care expenditures and in improving access to health care.
Retailers have often had a difficult time making the clinics financially viable, DiPasquale explained, so it would be helpful for health reform legislation to include some tax incentives or subsidies “to get these clinics up and running, and get to critical mass.”
“We have heard great stories about how they drive down costs, where people run to the emergency room and get a $400 bill vs. going to the clinic and getting a $40 bill,” he said.
Both FMI and NGA also object to language in the House bill that would place restrictions on flexible health spending account purchases — especially disallowing purchases of over-the-counter medications.
“Limiting the choice and ability of consumers to obtain affordable OTC treatment options using their FSA funds is contrary to the goals of reducing costs and improving choice,” Sarasin said in the letter.
She also cited the plight of independent supermarket companies that file taxes as individuals, and could thus be subject to the proposed 5.4% surtax on those earning more than $500,000 annually in addition to having to provide additional coverage or pay the 8% penalty.
A Senate version of the bill is expected to come out this week.