Association Health Plans and Minimum Wage
Domestic Issues
Back On Federal Agenda
by Jonathan Yarowsky
NATO Washington Counsel
While national security concerns have dominated the congressional
agenda for much of this year, many legislators are working
to refocus discussion on the economy and other domestic
issues. The following provides an update on two federal
issues of particular interest to NATO members and small
businesses across the nation: association health plan (AHP)
legislation and ongoing efforts to increase the federal
minimum wage.
Association Health Plans
As small business owners across the country know, providing
health coverage can help them compete for quality workers.
NATO has solidly supported legislative efforts to give
small business owners the bargaining power that larger
businesses currently enjoy to purchase more affordable
health insurance.
In July, the House of Representatives passed
Association Health Plan (AHP) legislation with the support
of all House
Republicans and 36 House Democrats. This House-passed legislation,
the Small Business Health Fairness Act (H.R. 660), would
allow small business owners to work together across state
lines through professional associations to purchase health
care coverage for themselves and their employees. In addition,
the legislation provides that AHPs be regulated by the
Department of Labor, rather than by regulations in each
state.
The House has passed this legislation in
previous sessions without reciprocal Senate action. However,
this year, there
has been increased scrutiny of the issue on the Senate
side. As we noted in the June
issue of In
Focus, Sen. Olympia
Snowe (R-Maine) introduced legislation (S. 545) in March
that is substantially similar to H.R. 660. In addition,
Snowe ascended to the chairmanship of the Committee on
Small Business and Entrepreneurship; her first hearing
as chair explored the crisis that small businesses face
in trying to find affordable health care for their employees.
Snowe’s bill faces opposition from
large insurance companies and others who contend that AHPs
would raise
insurance premiums for small businesses that are not covered
by the plans. They also fear AHPs would intentionally structure
plans to only serve small businesses with healthy workers.
However, AHPs are part of President Bush’s small
business agenda; and he has called on Congress to pass
legislation allowing AHPs, stating: “It makes no
sense in America to isolate small businesses as little
health care islands unto themselves. We must have association
health plans. ...” Further, Labor Secretary Elaine
L. Chao has strongly advocated approval of national AHPs,
and has confirmed that the Department of Labor stands ready
and willing to provide oversight necessary to ensure that
such plans are successful. NATO continues to advocate for
timely Senate action on AHP legislation in the 108th Congress;
its actions included firing off a letter dated July 8 to
all 100 members of the Senate urging speedy passage of
S. 545.
Minimum Wage
As the countdown to the 2004 presidential race continues,
it is reasonable to expect that domestic issues will
begin to take center stage. One such issue is an increase
in the federal minimum wage, an issue with which NATO
continues to play a proactive role. In July, prominent
Senate Democrats embarked on a new effort to increase
the minimum wage, arguing that after seven years, an
increase is long overdue. According to proponents of
an increase in the federal minimum wage, if America can
afford extensive tax cuts worth $383 billion, it can
afford to increase the paychecks for minimum wage workers.
Sen. Edward Kennedy (D-Mass.) is a leading
champion of a minimum wage increase. He has argued that
the value of
the increase that Congress approved in 1997 has declined
to the point that those wages are worth less now than
they were before the most recent increase. Maintaining
that
7 million workers would benefit from the proposed increase,
the senator is pursuing a legislative strategy that seeks
an increase through any and every suitable vehicle. In
past sessions of Congress, Kennedy has been able to successfully
force a vote on minimum wage proposals.
Thus far, Republican leaders in the Senate
have thwarted attempts to attach a minimum wage increase
to moving
legislation. However, as the partisan battles of election
year politics
approach, it is likely that the minimum wage issue
will receive more attention, and that the Democrats will
be
able to force a vote in the Senate. 
