The Best (and Worst) States for Small Business Healthcare Costs

According to SBE Council President & CEO, Karen Kerrigan, "Few understand the costs of health care better than small business owners. In the face of significant costs, they struggle to remain competitive, provide health care coverage for themselves, their own families, employees and the families of workers. Unfortunately, many policies that have been put into effect have only increased health insurance costs. That is the case not just with federal policies, but state initiatives as well."

The Index is a means of highlighting trouble spots as well as places where things are working and costs to business are low. The ranking of the states in the Healthcare Policy Cost Index is accomplished by measuring five policy items that impact the cost of healthcare. By doing this, the Index is able to show which states have a good climate for healthcare costs and which do not. These measures include mandated benefits on insurers, "play or pay" mandates on businesses, community rating mandates, guaranteed issue mandates, and the tax deductibility of health savings accounts. The results of the Index clearly show that the places with the highest combined state and federal intervention in healthcare are also the most expensive.

The best 15 states in terms of state healthcare policies are : 1) Idaho, 2) Utah, 3) Iowa, 4t) Michigan, 4t) Ohio, 6) Alaska, 7) South Carolina, 8) South Dakota, 9) Pennsylvania, 10t) Nebraska, 10t) Wyoming, 12) District of Columbia, 13) Kentucky, 14) North Dakota, and 15) Oklahoma.

The 15 worst states are : 37) Minnesota, 38) New Hampshire, 39t) North Carolina, 39t) Rhode Island, 41) Florida, 42) New York, 43) New Jersey, 44) Colorado, 45) Maryland, 46) California, 47) Vermont, 48) Connecticut, 49t) Maine, 49t) Washington, and 51) Massachusetts.

"Whatever health care crisis there might be in this nation, its origins can be traced back to governmental policies that raise the costs of healthcare, and thereby limit the availability of healthcare coverage. If policymakers are serious about having a positive impact on health care, then they must significantly relieve the system of mandates and regulations at the federal and state levels," concluded SBE Council chief economist Raymond J. Keating, author of the report.