ALBANY— The rising cost of health insurance coverage is a major concern for New York’s businesses. While most acknowledge the need for health care reform, they are increasingly concerned about adding new costs through higher taxes.

Unlike many other states, New York already has an extensive health care infrastructure with a variety of public plans subsidized by huge health care taxes charged to the state’s employers and others. In a letter to New York’s Congressional delegation, Kenneth Adams, president & CEO of The Business Council of New York State, calls on lawmakers to be mindful of the cost of federal health care reform on New York businesses. Adams asks that they view national reform proposals through “a New York lens” and avoid adding new costs to employers in a state that already has above average costs.

“New York State already has the broadest safety net of subsidized health coverage options of any state in the nation,” wrote Adams. “Subsidized health insurance options in New York come at a cost to our businesses and taxpayers. Currently, taxes on New Yorkers who voluntarily buy private health coverage total about $4.2 billion per year, reflecting as much as 10 percent of the cost of health insurance in some areas of New York.”

“Proposed surtaxes to support national health care reform would likely worsen New York’s business tax climate, which is already the second most unattractive in the nation. Employer mandated coverage as part of national reform could increase costs to New York businesses, especially if they have to continue to pay for New York-subsidized coverage pools already established by the state,” added Adams. “Reforms that reduce the high costs in New York, including mandate and tax relief, and more efficient health care delivery, are essential.”

If national health care reform leads to increased taxes for New York’s employers, those new costs must be offset by reforms here at home. “The risk is that our extensive safety net options in New York will not disappear under national health care reform, but are likely to grow, and with that the tax burden to support those models will grow too. We cannot do it all. We stand ready to work with you as you negotiate national health care reform, but ask that you keep New York’s businesses and taxpayers in mind as you weigh the very complex funding options on the negotiating table,” Adams concluded.

The full letter is available here.

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