AUG. 2, 2016 • BY JON HURST
As is often the case, the recently concluded formal session of the Legislature featured some wins—mostly in the defeat of costly employer measures—but some losses, primarily the continuation of existing discriminatory policies, which either result in lower sales, or higher costs for local sellers.
One important win was the passage of a measure to keep the state’s innovative Small Business Health Insurance Cooperatives operating and serving employers of 50 and under. RAM operates one of the existing three co-ops in the state, and thanks the Legislature--in particular the House of Representatives--for recognizing the costly, discriminatory and unfair application of health insurance rates under federal ACA rules. In the Economic Development bill passed Sunday, an important section sponsored by Representative Kate Hogan (D-Stow) allows for new financial incentives to use wellness and provider transparency tools through small business cooperatives. In reaction to double digit premium increases for small employers following the passage of “RomneyCare,” the Legislature in 2010 authorized group purchasing through non-profit cooperatives with upfront premium discounts. Yet, those savings are evaporating under preemptive ACA requirements on state rate setting. The ACA required phase out of state rating factors, means no upfront premium flexibility remains to award employees for using wellness programs, or to shop around for the low cost, high quality healthcare providers—common practices for large employers. The new state legislation moves upfront premium incentives to the end of the insurance contract period in the form of rebates, which remains legal under federal rules. The section also encourages the Baker Administration to seek an Innovation Waiver from the federal government under the ACA to seek more flexibility and fairness for Massachusetts small businesses and their employees. Without rate flexibility and consumer financial incentives, small business health insurance premiums are more accurately labeled healthcare taxes.
Health insurance is a mandate which disproportionately disadvantages those who work for small businesses; and the cooperatives reform will help create more fairness. However, RAM is disappointed over the loss of two vital initiatives designed to ease other government imposed competitive discrimination, as they relate to the sales tax and to Blue Law restrictions.
For only the second time in the last twelve years, no Sales Tax Holiday was authorized for this August, meaning local sellers and our economy will lose hundreds of millions in sales to internet and New Hampshire competitors which enjoy 365 days a year of tax free sales. Those two days recover a remarkable amount of tax sensitive sales from consumers looking for a reason to invest their dollars locally. With accelerating mobile commerce growth—much of it untaxed—the 6.25% sales tax disparity is threatening the very future of our Main Streets and retail jobs in the Commonwealth. Government is picking winners and losers in the marketplace, and our losers are our local stores and employers.