Suburban companies prepare for health care change

Executives at suburban companies and organizations huddled with colleagues on Monday to review the impact of the new health care bill once President Obama signs it into law.

The House vote and continuing work has provided a measure of certainty about the future of health care, but most companies are going to wait for the Senate to finish their work before they dive into the minutiae of the law and how it will affect them, business leaders say.

Many small and self-employed business owners could look at this favorably after an era of constant shopping for new and competitive insurance and the inability to control or plan for the ever growing premium costs, said Doug Whitley, president and CEO of the Illinois State Chamber of Commerce. But other business representatives said they're worried that new taxes and mandates will stunt a possible economic recovery by discouraging small businesses from adding staff.

And very few, if any, are aware yet how the new law will affect the cost of their employees' health plans.

"Health insurance costs have been problematic for all employers for many years, but the owners who have been most vocal about their frustrations and expenses have been the small employers and the self-employed," Whitley said.

The shift in the nation's health care landscape will surely challenge drug, insurance and hospital companies. But many experts believe the short-term profit squeeze ultimately will be outweighed by the business of millions of new patients entering the system.

The problem for everyone else is that, even though a law has passed, there's so much that still has to be determined about just what it will do. The law is only Step One. There will be federal rules and regulations as well as implications for state rules and regulations, he said.

"Most businesses will not be able to plan with certainty until many aspects of the new law are analyzed and implementations begin," Whitley said. "The phase-in nature of the benefits and the costs will occur over years. Therefore, most business owners are still in a wait-and-see mode. This is particularly true for businesses that are directly associated with insurance and health care."

Some suburban chambers said some of their member companies are just starting to sift through the language.

"I'm sure there will be a need to understand the plan before companies can decide what they will do," said Jean Gaines, executive director of the Geneva Chamber of Commerce. "Remember, most of our members have fewer than 25 employees and that puts them in a different category as well."

Zurich American Insurance Co. in Schaumburg is one company that's not making any plans until the reform is signed into law.

"Since the Senate has yet to act, we aren't making any plans as of yet," said Zurich spokesman Steve McKay.

Also, Schamburg-based Motorola Inc. is reviewing the reform, said company spokeswoman Tama McWhinney.

"Motorola is committed to offering competitive benefits, and we are evaluating the potential impact of the legislation," McWhinney said.

And the legislation still is being written as senators tangle over "fixes" in the document over the next week. So no one knows the full impact of the taxes and fines that could be levied in 2014, said Jim Uszler, executive director of the Mount Prospect Chamber of Commerce.

"Small business owners are likely to be saddled with additional costly mandates and burdened by regulatory requirements," said Uszler.

John Schmitt, president and CEO of the Naperville Area Chamber of Commerce, said businesses with 50 employees or less could be hunkering down, since this is where one of the main fee triggers is based, he said.

"What makes us a little uncomfortable, is that typically, it is firms with less than 50 employees that are the engine of job growth after a recession. This law phases in a number of taxes starting in 2010 through 2013, that could erect large financial penalties to growing firms and job creation, or in some cases encourage them to make some head count adjustments," said Schmitt.

The marathon debate and passage of the historic bill on Sunday led executives at companies, hospitals and insurance firms to review the potential impact to their own bottom lines and how it would effect their employees.

Health Care Service Corp., parent of health insurer Blue Cross Blue Shield, said last August it was forced to cut about 650 jobs, including 239 in Illinois, due to the bad economy and in "anticipation" of the health care reform, HCSC said at the time. In light of the bill's passage, HCSC said Monday it is committed to working with the administration, said HCSC spokeswoman Mary Ann Schultz.

"We have been reviewing provisions of the legislation and we are in the process of developing implementation plans," Schultz said. "We will continue to review the bill's requirements on our business and their respective time frames to ensure full compliance."

Libertyville Township-based Abbott Laboratories and other pharmaceutical firms referred comments to the national Pharmaceutical Research and Manufacturers Association.

The association issued a statement that said that while it supports the administration, it has "concerns" about issues involving "broad powers of a non-elected Independent Payment Advisory Board, which could enact sweeping Medicare changes without action by Congress and would not be subject to judicial or administrative review."

Local hospitals, which need to operate like businesses, will need to shift to new business models to thrive. Many hospitals already have been adapting by realigning their operations and advancing with new technology, said Maryjane Wurth, president of Naperville-based Illinois Hospital Association.

"What does this mean for me, the facility and the community? The hospital will be developing a business plan accordingly. It will mean greater compensation and less uncompensated care," said Wurth.

Until the law becomes enacted, businesses should stay focused on creating jobs and providing a great product or service at a great value, said Jon S. Ridler, executive director of the Arlington Heights Chamber of Commerce.

"Washington politics is not going to bring our country out of this recession, businesses and consumers are," Ridler said. "Small businesses are the nerve center of our country, they are the healing power that we all need."

•Daily Herald Business Writer Kim Mikus and Associated Press contributed to this report.