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Report: Texas Businesses Wary of Federal Health Reform

Texas businesses are skeptical of the federal health care law, according to a report released by the comptroller's office. Nearly two-thirds of survey respondents said the law will be bad for business.

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Texas business owners have "significant doubts" about the federal health care law being considered by the U.S. Supreme Court, according to a report released Tuesday by the state comptroller’s office.

Nearly two-thirds of the 919 business owners surveyed — members of either the National Federation of Independent Business or the Texas Association of Business — said they feared the law, if upheld, would be bad for business.

"While we expected to find some skepticism regarding health care reform among the respondents, the overwhelming weight of opposition was truly surprising," Comptroller Susan Combs wrote in the report. 

At a roundtable discussion Tuesday on the survey, Combs said she was surprised by the dislike for the health care law. "But the uncertainty as well," she added. "I say this as the [state's] chief financial officer: Uncertainty is bad for business."

She added that "attitude drives business. It makes a real difference, and the whole phrase I use is, 'Capital will flee a hostile environment.'"

The report's release comes less than a week after the U.S. Supreme Court heard oral arguments in the case challenging the constitutionality of the Affordable Care Act. Twenty-six states including Texas have supported the lawsuit against President Obama’s signature legislation.

"Based on this survey, there’s no conclusion other than the Affordable Care Act has been a damper on hiring at a time when the federal government should be doing everything to increase hiring," said Bill Hammond, president and CEO of the Texas Association of Business. "It’s had the exact opposite effect of what the administration has been saying they want."

The survey shows 36.5 percent of respondents expect no effect on their hiring or health care coverage decisions as a result of the law, while 12.5 percent said they have reduced staffing and 24.7 percent expect to eliminate or reduce coverage in the next two years. More than half of the respondents expect the costs of benefits provided to employees to rise because of the law, compared with a third who replied that they didn't know, and 12 percent who believe that costs will decrease.

Most respondents to the survey were businesses with fewer than 25 employees. Seven percent had more than 100 workers.

The comptroller’s office issued a report in 2011 that studied the health care reform’s impact on Texas. In publishing the latest report, the comptroller’s office said it "wanted to better gauge the Texas business community’s views on the potential impacts of federal health care reform by reaching out to and hearing from the most businesses possible in Texas," according to the report.

The Texas Association of Business is a corporate sponsor of The Texas Tribune.

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