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Texas Pest Control Companies Struggle With Rising Health Insurance Premiums

Posted on: Monday, 20 March 2006, 21:00 CST

By Dan Wallach, The Beaumont Enterprise, Texas

Mar. 19--As Ed Boone Jr. listened intently last week to comments by U.S. Rep. Kevin Brady about reforming health insurance, he felt cheered -- even under the burden of a 43 percent increase in coverage for his employees at Security Pest Management.

Brady spoke to members of the Greater Beaumont Chamber of Commerce about hurricane recovery in particular, but also commented on others issues of importance to him. Brady is a member of the tax-writing House Ways and Means Committee, which considers a variety of bills affecting business.

Boone, 36, recently had traveled to Washington, D.C., with the executive director of the Texas Pest Control Association for their national group's meeting.

One of the top issues facing their industry -- like so many others -- is the cost of providing health insurance.

The association wants Congress to consider allowing the individual businesses in the association to buy health insurance through the association, thus creating larger numbers to qualify for cheaper premiums.

In Texas, there are 3,453 pest control companies, according to the state Structural Pest Control Board, the licensing agency for the industry.

The state association has about 600 members, Boone said.

"We're trying to use health insurance as an incentive to join the Texas Pest Control Association," said Boone, who is an association board member.

When Boone and other small businesses try to buy insurance, they face higher premiums that seem to rise each year.

For Boone, it's a delicate balancing act of employing and retaining quality workers and providing them with competitive benefits while selling his service at a competitive price to help his business grow.

"We are analyzing our programs every year. When we were smaller, we could absorb the increases. Now, it's too large for me as the owner to absorb every year," he said.

Boone said he changed to a new insurance carrier this year, and in so doing he had to ask each of his 20 employees to accept paying $5 more per week, bringing their total insurance contribution to $26.47 per week, an increase of almost 19 percent.

Boone's father started the business in 1974 in the family living room in Port Arthur. The company began providing insurance to employees in 1992 at a cost of about $10,000 a year.

By 2000, health insurance cost the company $25,000 a year and it's up to $40,000 now, Boone said.

In just the past two years, Boone said his cost to provide coverage rose 43 percent.

"We have to try to provide benefits as we have in the past," he said.

"It's increasingly difficult to do. That's why we want legislation so we can have more tools."

Brady, he said, is cosponsoring a bill that would make it possible for businesses to aggregate for the purpose of buying group health insurance for their employees.

"There's no need to convince him," Boone said. "He's already on board. For him to bring it up was a real thriller. He's obviously promoting it."

A competitive benefits package is crucial to helping his business grow, Boone said.

"We've grown 20 percent in the last two years. To grow, we have to provide competitive benefits," he said. "I can't foresee owning a company without maintaining quality employees. It's important to keep employees healthy. I need every minute of every day of every person we have here."

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Copyright (c) 2006, The Beaumont Enterprise, Texas

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Source: The Beaumont Enterprise

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