Passing the cost of health care onto you.

A recent posting in The Right Standard discusses the effect of the new health care reform bill on small business, more specifically, cafes, bistros, and other small restaurants. The posting is based on another posting by Fox News’ Claudia Cowan. In her (and The Right Standard’s) posting, she discuss the “employer mandates” which the new health care legislation will place on small businesses. The new law will require small businesses to provide some form of health insurance or face penalties for non-compliance. It is the argument of the author that the reason many of these small businesses don’t offer health insurance today is they simply do not bring in enough revenue. If the government in turn, requires them to shell out money to provided even the most basic of health care to their employees, the businesses will have no choice but to either raise their prices or shut the doors altogether.

To back up this point, the post refers to the city of San Francisco, CA which has had the same type of mandates in place for over a year now and has been met with mixed reviews. The San Francisco ordinance requires all businesses with over 20 employees to provide health insurance. The post says that, due to increase in costs, the city of San Francisco has lost over 200 restaurants in the last four years.

The post on The Right Standard is not geared to one particular audience, but rather at anyone who is opposed to the health care bill. By focusing on one issue of the bill, he is trying to shed a negative light on the entire bill by saying it will kill small business. The author of the post on the Right Standard is unknown so it is hard to judge his creditability; however Claudia Cowan is a well known and well respected journalist in California. The evidence in the posting is rather compelling, losing over two hundred restaurants in four years is a big number and means quite a few people lost their jobs. However, the posting doesn’t quote any sources or studies to verify the numbers. Let’s assume the number is true for the purpose of this. If true, the logic behind the post is sound. Often times, states are used as a test ground for policies. If they work on a state level, they have a good chance of working on a national level. The same can be said for cities within states. If the policy of requiring small businesses to provide health insurance has already cost the city of San Francisco 200 restaurants, the national policy would cost the nation a lot more.