As Congress returns to work this week, senators are scheduled to cast a critical vote on Tuesday as part of a broad measure designed to encourage economic growth for small businesses. But in this case, the outcome could end up hurting small business, costing us billions in crucial prevention dollars and jeopardizing efforts to improve and protect the health of millions of Americans.
At issue is an Internal Revenue Service reporting requirement included in the new health law as a means to raise revenue to offset reform’s costs. It does so by reducing noncompliance with tax laws by requiring expanded 1099 reporting on certain business transactions – a reform, by the way, that was supported by George W. Bush during his presidency. Since the measure became law, Democrats and Republicans alike have realized that it places an unnecessary burden on small businesses, which are already stretched thin by the current economy.
Those backing the amendment by Sen. Mike Johanns, R-Neb., say it will help small businesses by providing them relief from this reporting regulation. The Johanns amendment, however, makes up for the resulting lost revenue by virtually eliminating the landmark Prevention and Public Health Fund. Helping small businesses makes sense – but we won’t be helping them by eliminating prevention.
The Prevention and Public Health Fund, established as part of health reform, is a 10-year $15 billion commitment to wellness. Instead of just treating illness, the fund invests in proven strategies that prevent people from getting sick in the first place – and that save money down the line. It would provide much needed funding to support community-based tobacco cessation and prevention programs, initiatives to reduce diabetes and heart disease, breast and colon cancer screenings, and adult vaccine programs.
Additionally, community prevention efforts support smart communities where people can walk to work, access public transportation safely and easily, and buy fresh fruits and vegetables right in their neighborhood.
Physical activity, safe neighborhoods and access to nutritional foods have everything to do with health, and our economy. Our country spent $83 billion caring for diabetes patients in 2008 alone. If you divide that cost among all people in the United States, the bill comes to $267 per person – and that was in just one year. More than half of the differences in obesity rates among countries are linked to walking and cycling rates: the availability of crosswalks and bike paths, and policies that restrict car use encourage walking and cycling, lowering diabetes risk in the process. If we were able to reduce the number of Americans who have diabetes by even 5 percent, that could save us as much as $4 billion every year just in hospital visits.
Of course, we won’t be saving money on diabetes alone; we’d be saving money from reductions in heart attacks, asthma, strokes and many other chronic diseases. Prevention Institute research reveals that smart prevention strategies deliver a 5-to-1 return on investment in just five years. At an investment of just $2 billion dollars a year, the Prevention Fund is a bargain indeed.
What’s more, prevention is good for small business. Chronic diseases cost the United States $1 trillion annually in lost productivity, placing our economic security and ability to compete globally in jeopardy. A newly released University of Michigan study demonstrates that workplace wellness programs have long-term health and cost-saving benefits. One Midwest utility company showed a net savings of $4.8 million in employee health and lost work time costs over nine years. We won’t be helping small business or the economy by gutting the Prevention Fund.
And the motives behind the amendment may be less altruistic for small business than they seem. Sen. Johanns has previously stated that repealing health reform is on his agenda, even if it has to happen piece by piece. In addition to eliminating crucial prevention dollars, his amendment starts the dismantling of health reform, by reducing the number of Americans who will be covered by health insurance and increasing the cost of premiums for those who are insured. Small businesses stand to gain as much as $40 billion in tax credits through the existing health reform law, and see lower premium costs to boot.
In this anemic economy, small businesses need all the help they can get, and the Prevention and Public Health Fund provides the best medicine. The fund is a critical step in building a healthy, competitive workforce and controlling the costs of health care.
If senators want to support small businesses, reduce health costs, spark economic growth and improve health outcomes across the nation, they should vote “no” on the Johanns amendment.