WASHINGTON — President Barack Obama, citing a new White House study suggesting that small businesses pay far more per employee for health insurance than big companies, said Saturday the disparity is "unsustainable — it's unacceptable."
A study by the White House Council of Economic Advisers said small businesses pay up to 18 percent more to provide health insurance for their employees. As a result, fewer of them do so.
Separately, congressional budget scorekeepers say one highly touted idea for saving money from Medicare to finance a health overhaul would only yield modest savings. In a setback for Obama, the Congressional Budget Office says that creating a powerful commission to recommend Medicare cuts would produce only about $2 billion in savings over 10 years. Cuts the commission agreed on would go into effect unless Congress overrode them.
The White House study said only 49 percent of businesses with three to nine workers and 78 percent of companies with 10 to 24 workers offered any type of health insurance to their employees in 2008. In contrast, 99 percent of companies with more than 200 workers offered health insurance.
Small companies pay more because they lack bargaining power and face higher administrative costs, the study found. "Right now, they are getting crushed by skyrocketing health care costs," Obama said.
Republicans dismissed the new report as propaganda.
"There's a reason why almost every employer and small business group is opposed to the Democrats' government takeover of health care, and that's because it would impose new job-killing taxes during a recession," House Minority Leader John Boehner, R-Ohio, said.
Obama decried what he said were tactics by opponents to block health care overhaul "as a way to inflict political damage on my administration. I'll leave it to them to explain that to the American people."