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A Letter in support of S. 1049, the "Small Business Health Relief Act of 2011."

June 30, 2011

The Honorable Jon Kyl
United States House of Representatives
730 Hart Senate Office Building
Washington, DC 20510

Dear Senator Kyl:

On behalf of the 362,000 members of the National Taxpayers Union (NTU), I write in support of S. 1049, the “Small Business Health Relief Act of 2011.” Your bill would repeal many of the onerous provisions contained in the Patient Protection and Affordable Care Act (PPACA) that increase health insurance prices and raise taxes.

America’s health care system has long been in dire need of reform. Rising costs have made it difficult for many to afford insurance, in large part due to the complicated bureaucratic and regulatory framework that distorts markets, as well as our employer-centric system that short-circuits the cost-efficient consumer-provider relationship. Meanwhile, Medicare and Medicaid have saddled Americans with tens of trillions in unfunded liabilities. Rather than solve any of these issues, PPACA merely added a tangled web of new taxes, government mandates, and burdensome regulations. The end result has been higher costs for taxpayers, reduced choice for patients, and disincentives for employers to hire new workers.

The Small Business Health Relief Act would address some of the most egregious parts of PPACA until full repeal can be accomplished. Among the many positive changes made by this legislation is the elimination of section 9010, which imposed a new fee on health insurance providers that would inevitably be passed on to consumers. The Joint Committee on Taxation estimates that removing this fee will save the average family $350 to $400 each year in premium costs.

Your bill would also repeal PPACA’s employer mandate, which penalizes businesses that fail to offer government-approved insurance plans. This ill-conceived provision promises to have numerous unintended consequences as businesses attempt to save money by either pushing workers into government-run exchanges or avoiding extra insurance costs by refusing to hire new workers. Doing away with these perverse incentives allows employers to focus on the job creation that is desperately needed to jump-start our economic recovery.

Finally, S. 1049 would repeal an oft-overlooked PPACA provision that instituted a $2,500 cap on Flexible Spending Accounts (FSAs). As a result of these caps, health care purchasers now must contend with higher taxes despite fewer choices since they no longer have as much freedom to use pre-tax dollars to pay for doctor’s visits, prescriptions, over-the-counter medicines, and other out-of-pocket costs. Restoring FSA rules to their previous state will help American families get the most value out of their health care dollars.

For the aforementioned reasons, NTU endorses your Small Business Health Relief Act of 2011 and any roll call votes will be significantly weighted in our annual Rating of Congress.

Brandon Greife
Federal Government Affairs Manager