Health insurance expenses are the fastest-growing cost component for employers, making the ability to provide adequate health coverage to employees a significant challenge for manufacturers.
In response to this growing concern, House Health Policy Committee Chairman Hank Vaupel (R-Fowlerville) invited MMA to testify before the Committee last Wednesday, 2/22/17, on issues relating to health care costs and the long-term impact those costs have on Michigan’s manufacturing industry.
“Rising health care costs hinder manufacturers’ ability to compete globally, drain resources that could be better invested elsewhere, inhibit the creation of new jobs and undermine economic growth across the nation,” testified Delaney McKinley, MMA director of human resource policy and membership development.
MMA recommends lawmakers focus on two specific areas to ensure Michigan employers remain competitive and are able to continue boosting statewide economic growth:
- Encourage flexibility and creativity in plan design
- Eliminate state specific health care costs
McKinley spoke extensively of the chilling effect that the anti-competitive Health Insurance Claims Act (HICA) tax has had on manufacturers who pay for health care for their employees.
“No other state in the nation has a tax like the HICA tax,” said McKinley, “Our competitors in Ohio and Indiana are not saddled with this additional tax burden on their health care bills.”
The HICA tax has added over $1 billion to the cost of purchasing health care in Michigan since its inception in 2011. In fiscal year 2017, it is expected to add another $305 million to the backs of employers and individuals that purchase health care.
“In order for manufacturers to be able to continue to provide affordable insurance to their employees and to compete in global markets, it is critical that we ensure that health care costs are contained whenever possible,” testified McKinley. “We welcome a partnership with each of the members on the House Health Policy Committee and in this chamber to accomplish our goal of affordable, quality health care for Michigan employers and workers.”