Health insurance tax credit for small businesses proposed

Whether they're making sea-salt caramels, aerospace parts or empanadas, Connecticut's small businesses need help securing health insurance for employees, owners and state leaders said Wednesday in Waterbury.

"I have people here that I want to provide for, and anything will help," said Carmen Romeo, gesturing at the workers dipping meltaways and bagging nonpareils at the Fascia's Chocolates factory on Chase River Road.

The family-run candy company at one time offered health insurance to its small core of about 10 full-time workers, but premiums rose so high they had to cancel the plan. Then Cigna dropped the company from a subsequent plan when it exited the market for small groups, and Fascia's workers were left to find coverage on their own..

"We need a way back in," Romeo said. "I have more employees now -- I might be able to get back in the game with about a dozen employees eligible for health care. I just need a way in."

Gov. Ned Lamont came to Fascia's on Wednesday to highlight a new alternative for the state's smallest businesses: A tax credit that will reimburse employers up to $1,000 a year per employee enrolled in the state's insurance exchange.

"You gotta treat your people right," Lamont said. The new credit will "make it a little easier for you to administer this for the folks that work here right now, save you a little bit of money and make sure that these folks have the care they need."

Lamont urged the state Legislature to approve the tax credit as part of House Bill 5041, which includes health-insurance-related measures like a study of the debated "Connecticut Option" health plan.

"It's also a bridge to what we're trying to do with the Connecticut option, where we try and steer people to those hospitals where you get the very best value, the very best top quality care at a very affordable rate," Lamont said of the small-business tax credit.

Business owners can get a head start on claiming the tax credit by registering now with the state's insurance exchange, Access Health CT, and supplying information on the number of workers needing coverage and their salaries, Lamont said.

"Take advantage of that right now," Lamont said.

The tax credit will enable some workers at small businesses to get coverage, but employers facing soaring health costs need more help to stay afloat, said Chris DiPentima, president and CEO of business group CBIA.

"This will help those microbusinesses that probably aren't insurable today, but then, when you get above 10 and you're going through a couple hundred, you need more solutions there," DiPentima said, referring to numbers of employees.

CBIA blasted lawmakers earlier this week for rejecting a bill that would have allowed small businesses to buy health insurance through a trade association or local chamber of commerce.

"Unfortunately, some members of the Appropriations Committee put politics in front of good policy -- penalizing small businesses rather than helping them and their employees navigate Connecticut's growing affordability crisis," DiPentima said in a statement.

"It's just having as many options in the toolbox as possible," DiPentima said of both measures. "There are probably not even enough options... but at least this creates progress."