Health care start

A bill to encourage small-business owners to offer health care to children of employees became law this week as a start to what should be more incentives to help businesses with this cost. Here’s a slipperly slope that Maine might want to start sliding on.

The legislation, crafted by state Sens. Peter Mills and Susan Longley, allows employers with fewer than five low-income employees to claim a tax credit worth up to $125 per employee. A maximum $500 credit isn’t likely to change the behavior of employers, but the program is a start to expanding health care coverage for families. The Maine Children’s Alliance reports that Maine has the highest percentage of uninsured children in New England.

Despite its limited range, the bill makes Maine the second state in this region to offer employers tax incentives to cover children, after Massachusetts. What is surprising is that the bill passed at all. It began as broad coverage of all employers, providing credits when the cost of health care for a business exceeded 7.5 percent of gross payroll. It was whittled down throughout the session, but retained bipartisan support. Gov. King signed it into law late last week.

One of the reasons for its passage was the support of the Maine Chamber and Business Alliance, which knows from its own surveys how important health-care costs are to Maine businesses. Last December, business owners ranked health care second only to workers’ compensation as most important to their bottom lines. Health care, in fact, finished ahead of the state tax burden, electric energy costs and local taxes. Given how much time politicians devote to fretting about these last three items, even this modest attempt at cutting health-care costs should be applauded.

Once the applause stops, however, lawmakers should start thinking about affordable ways to widen the use of the credit. Part of the reason this legislation is needed is that expanded Medicare programs now cover more Maine children, and the temptation exists for some businesses to push their employees off private insurance, knowing they will be picked up by the public plan. The credit is a way to counter this, and could be effective if it is made large enough.

That’s a challenge for next session. For now, Maine has a chance to see whether small businesses take advantage of this good idea.