In early June, the New Hampshire Senate proposed a state budget that included legislation potentially increasing health insurance costs for small businesses and their employees. The proposal featured a new tax on health insurance intended to fund a state-created mental health program, along with several costly coverage mandates.
However, these provisions were removed from the final budget following actions by NFIB members and collaboration with a coalition concerned about rising healthcare costs. John Reynolds, NFIB New Hampshire State Director, expressed concerns in an op-ed published by NH Journal before the budget agreement was finalized.
Reynolds emphasized that “for small employers, health insurance is a crucial benefit for recruiting and retaining workers.” He highlighted structural disadvantages in how health insurance markets are regulated at both state and federal levels. According to Reynolds, small businesses purchasing employee coverage in the small group market generally incur higher costs than larger competitors who can self-insure.
He noted that rising healthcare costs have adversely affected small businesses in New Hampshire. Between 2018 and 2023, there was a 20 percent increase in small group premiums alongside a 16 percent decline in enrollment. Large group enrollment also decreased during this period due to escalating premiums.
Reynolds warned that “the problem will get worse if a new health insurance tax becomes law this year.” The proposed provision would tax private health coverage to fund youth mental health services under a state government program. He acknowledged the seriousness of the care involved but questioned “how to pay for it and who should provide it.”
He argued that this uncapped tax would exacerbate financial burdens for small employers, raise premiums for workers and their families, and be misplaced.
The full op-ed can be read here: REYNOLDS: Higher Health Insurance Taxes Will Hurt Small Businesses – NH Journal
