The Iowa Senate

State of Iowa

Eighty-First General Assembly

STATEHOUSE

Des Moines, Iowa 50319

For Immediate Release Contact: Kimberly Steenhoek

Thursday, Feb. 9, 2006 (515) 281-6571

Senate Republicans Work to Make Health Care More Affordable

DES MOINES – Republican senators today introduced initiatives aimed at making health care more affordable for Iowans.

The legislation includes tax credits to encourage small businesses to offer health insurance for their employees and a revolving loan fund to help Iowans establish health savings accounts.

“Growing health care costs are among the biggest challenges facing Iowa’s working families,” said Senate Republican Leader Stewart Iverson (R-Clarion). “While Iowa has always been one of the leading states in the nation for those with health insurance coverage, we must do better.”

The first bill would offer a tax credit to businesses with fewer than 50 employees that provide insurance coverage for their workers. Eligible companies would receive a tax credit of $1,000 per employee with a maximum of $25,000 per company for providing health insurance.

There are 81,937 companies in Iowa employing 50 employees or less, according to U.S. Department of Labor statistics.

“As insurance premiums go up, the ability for small businesses to offer health insurance reduces dramatically. In Iowa alone, we estimate there are at least 200,000 employees of small businesses who are uninsured,” said Senate Co-President Jeff Lamberti (R-Ankeny). “By making it easier for small employers to provide affordable health insurance, we can help alleviate the burden of high health care costs on these families.”

The second bill would create a $10 million revolving loan fund to help Iowans establish health savings accounts. The accounts, which are coupled with insurance, allow individuals to save money, tax-free, for major medical expenses.

Loans from the fund would help Iowans frontload their health savings accounts before meeting their deductibles. Participants could draw loans from the fund for a period of two years and would be required to pay back their loans over 12 months.

“Health savings accounts put consumers in the driver’s seat when it comes to their health care,” said Sen. Ron Wieck (R-Sioux City). “Under our plan, more Iowans will have the opportunity to invest in their health.”

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