Smoking ban, insurance expansion proposals worry Pa. businesses

1/18/2007, 6:37 p.m. ET
By MARTHA RAFFAELE The Associated Press

HARRISBURG, Pa. (AP) — Pennsylvania's tavern owners are likely to oppose Gov. Ed Rendell's call to ban smoking in workplaces, restaurants and bars, while other business leaders are concerned about how the state will determine which employers will have to pay a special tax to help expand state-subsidized insurance for adults.
Rendell's broad "Prescription for Pennsylvania" proposal to reduce health care costs and make insurance more affordable to roughly 800,000 adults without coverage also includes a proposed statewide smoking ban, one of several measures aimed at promoting healthy lifestyles.
Lobbyists for restaurants and taverns had uniformly opposed efforts to ban smoking in those establishments, but have recently split over the issue. In June, the Pennsylvania Restaurant Association's board of directors voted to support a comprehensive statewide smoking ban, citing concerns about the effect of secondhand smoke on employees.

"By doing this, we hope to be part of the solution," Patrick Conway, the association's executive director, said Wednesday. "A statewide solution means you don't have a patchwork of different regulations that are unfair and confusing to workers and businesses."
Amy Christie, executive director of the Pennsylvania Tavern Association, said her group's board has not had an opportunity to discuss Rendell's proposal. She said the state's 1988 Clean Indoor Air Act, which requires designated nonsmoking areas in certain establishments, goes far enough.
"We are opposed to a smoking ban that is completely restrictive on bars and restaurants," Christie said.
States that already prohibit smoking in all private workplaces, restaurants and bars include Delaware, Hawaii, Massachusetts, New Jersey, New York, Rhode Island and Washington. Three others — Ohio, Arizona and Nevada — passed similar bans in the November election, although Nevada's exempts casino gaming floors and has been challenged in the courts.
California, Colorado, Connecticut, Maine and Vermont ban smoking in all restaurants and bars.
Rendell is also proposing to phase in a 3 percent payroll tax on businesses that do not offer health insurance, but exempt employers with fewer than 50 workers from paying it in the first year. The administration estimates that more than 100,000 businesses do not provide coverage.
Kevin Shivers, state director of the National Federation of Independent Business, noted the cost insurance to employees can vary widely across different businesses, and some offer high-deductible insurance plans with health savings accounts as an alternative.
"Maybe you pay 100 percent of a basic plan," Shivers said. "The question then becomes, are you providing insurance?"
Rendell spokeswoman Kate Philips said the state would consider health savings accounts as acceptable coverage, provided that they are comparable to the state's insurance plan.
"If someone makes minimum wage, and has a $30,000 deductible, that's not comparable," Philips said. "We're not outright rejecting the idea of health savings accounts ... it depends on the structure of the account."