Health care came up surprisingly deep into the conversation. This year several panelists saw their premiums increase about 25 percent; this was high, they said, but not unusually so. Josh More called it a "mild problem," and judging from the reaction around the table, most of the participants seemed to agree. Still, everyone present said health care was an important issue.

All but two of the entrepreneurs offer some heath insurance for their employees; the exceptions are at Adam Carroll's mortgage company and Robb Spearman's brokerage.

For a brief synopsis of the panel and its participants, click here. You can read previous installments of this series, including the introduction, here.

INC.COM: Those of you who don't provide insurance, why don't you?

ADAM CARROLL: All my employees are independent contractors. I would like to bring them all on board and offer comprehensive health benefits for everybody, but right now it's not feasible because we're a small company. Everyone who works for me is fairly young and healthy, so it's almost cheaper for them to get an individual policy and have a health savings account or a high enough deductible that they've saved up for than for me to pay for comprehensive health benefits for everybody.

ROBB SPEARMAN: Exact same issue for me.

INC.COM: Has it affected the productivity of your employees?

ADAM CARROLL: Not a big issue for me, because I have a fairly young team. But we have other benefits to compensate them.

ROBB SPEARMAN: For those realtors in my office who've gone from a full-time job where they have health benefits into a commission-type paying position as an independent contractor, it's a key issue for them. They talk about it. Attracting good workers is very important, and I know where I have not been as competitive because I don't have health insurance to attract better workers.

INC.COM: For those of you who provide health insurance, is there a problem for you right now?

JOSH MORE: It's a mild problem in my company simply because as an IT company we tend to have younger workers. But it's gone up every year, and when it goes up, everyone has to re-evaluate all the different plans and figure out what makes the most sense. I think it probably costs productivity just in the people who have to figure out what the new plan means every year, and make phone calls on work time, and figure out if their doctor is still going to be their doctor or if they have to find a new one.

STEVE BOERS: Our insurance went up again and we had to change providers, but we weren't told why it went it up. No background on why it would raise 27 percent.

JOSH MORE: We saw numbers like that, too. We shifted to avoid that.

STEVE BOERS: We did, too.

ADAM CARROLL: I think it's part of the litigious society we're in. That's ultimately where a lot of the problem stems from. Malpractice insurance for doctors is higher. You have people suing them; they have to increase costs. Insurance companies pass the costs along to us.

WAYNE HANSEN: Doctors are ordering every test in the book to cover their posterior, driving the cost up.

HANK EVANS: You try to raise your prices a little bit to cover the higher overhead. You ask the employees from time to time to pick up more of a percentage of it. Sometimes you reduce the coverages or increase the deductibles.

INC.COM: Adam, you recently started your own business, and I'm wondering if the economics of heath care made it more difficult to leave a job that offered you insurance and strike out on your own.

ADAM CARROLL: I think there's a common misconception in America that without a job, what are you going to do for heath benefits? I worked for a large national lender before I started my own company, and in all honesty, it's cheaper for me to get a private policy just for myself and my family -- I'm paying the same amount per month that I would pay for a policy through that large national company. Now, their coverage was better, and I've got a $3,500 deductible. But it covers well-child checks and things for my kids.

INC.COM: With a $3,500 deductible, are you a lot choosier about what you see a doctor about?

ADAM CARROLL: Oh, yeah, absolutely.

INC.COM: So somebody has to have been in a coma for at least a day before you make the call.

ADAM CARROLL [laughing]: Exactly. Look, if we have heath costs, we have health costs, and it's an expensive owning your own business. But we certainly take good care of ourselves. I don't go out skydiving on the weekends, or anything like that. We have to be pretty selective about what we do and how we live.

ROBB SPEARMAN: Very similar for me, but I have a $5,000 deductible, and I use a medical savings account. And now I'm single, so I don't have a wife or children. But starting out, yes, it's that way. You don't have the coverage.

INC.COM: There seems to be a pretty clear divide between the parties this year on health care. Democrats have proposed plans that are more or less the same in offering universal coverage. Republicans have been focusing mostly on health savings plans and the like. Where does this panel come down?

ROBB SPEARMAN: My views have really swung over the last ten or 15 years. I voted Reagan; I voted Bush. I even liked Pat Buchanan in '88 when he came through. I was conservative. I never thought I would say that we need the government to step in and help us with health insurance. There's 47 million people without insurance, and they've been talking about it for 15 to 20 years, and it hasn't gone anywhere. I don't know the solution, but it needs to be addressed, and the only people I see that are even offering plans for it is the Democratic field. I don't see the Republicans saying anything except that it must be privatized.

WAYNE HANSEN: What does government interference do to the greatest health care system in the world? I agree that something needs to be done, but I've always been more prone to go with the idea that privately we can do it better than we can with the government. But on the other hand, if I'm competing with somebody that is not giving their employees health care and we are, at some point we are no longer competitive. I don't know what the answer is, I really don't.

HANK EVANS: Once upon a time I worked for a Canadian firm many years ago, and if you think our health care is screwed up, you don't want to be a Canadian. I used to live in Buffalo, and you had to shuffle your way through the Canadians to get to the emergency rooms and the doctors' offices, and I understand it's only gotten worse. So I'm certainly not anxious to see the government screw something else up, especially the best health care system in the world. I'd just as soon they keep their bloody paws out of it.

ROWENA CROSBIE: All my family is still in Canada; I'm the only one that defected. As Hank was saying, the problem with the Canadian system is you can't even buy a higher level of care if you want. So my mother, who recently had cataract surgery, had to queue in a line for a year. You know, it's absolutely ridiculous. But with socialized medicine at least everybody gets some basic care. You can debate whether or not it's an OK level, but I think it's really unfortunate that in this fabulous country we've got so many people who don't even have a basic level. I don't know what the solution is. Should the government be involved in that? Probably, at some level. One has to wonder if there's a hybrid, but there should be some basic care for everyone, and then the option for more so you don't have to go to another country and buy yourself onto a list to get better care.

JOSH MORE: I don't think the federal level is the right place to run that experiment. What I would favor is regulations that allow the states to experiment with either a health savings account or shared deductible plan -- whatever. Being able to do experiments like that at the state level is really what made our country what it is. And this is something that just seems perfect for that kind of thing.

ROBB SPEARMAN: I kind of like what Ro is saying, that there should be some type of standardization. I think that would have to be through the government, state or federal. We need a blending of ideas from both parties, take the good of each, put them together. I think one key issue is to have guaranteed coverage for the 47 million people who have no health insurance. I imagine there's a lot of those who can't even buy health insurance because of how sick they are. We need to address that.

WAYNE HANSEN: I'm on board too with what Josh said about it being local as opposed to national. I've been up there at the state capitol to talk to legislators, and they listen, they really do. That's what amazed me the first time I did it several years ago. And they're close enough that you can start hanging on it. When it gets to Washington there's just no control.

In Part V, our panel takes on taxes and spending.