INDIANAPOLIS | Only two Indiana companies have taken advantage of new state tax credits designed to coax more businesses into offering health insurance to their employees.

Republican legislators fought for the $50-per-employee incentive to be included in a health care expansion lawmakers financed last year with a 44-cent increase in the state cigarette tax. At the time, legislative analysts predicted the tax breaks would cost the state upward of $11 million a year.

But records show only two companies -- one in Fishers, the other in New Carlisle -- tapped the tax credit this year. The Indiana Department of Revenue, citing taxpayer confidentiality, did not name the firms, which received a combined break of $2,550.

"I think it needs to be marketed more," said state Rep. Charlie Brown, a Gary Democrat who chairs the House Public Health Committee. The head of Indiana's human services agency agrees more outreach is needed.

"The business participation, although low, is not insignificant," said Mitch Roob, secretary of the Indiana Family and Social Services Administration. "We are looking forward to doing more outreach and marketing for this piece of the plan and getting more businesses signed up."

One of the participating firms got a $50 tax break while the other received $2,500, the maximum per employer. That means the program helped extend health insurance to at least 51 Hoosier workers.

Another eight companies, including one in Hammond and another in Munster, reaped $19,699 in separate tax breaks now available to firms that offer wellness programs encouraging employees to quit smoking, lose weight and embrace healthy lifestyles.

Roob said the slow start for the business incentive programs should be considered in context of the more than 20,000 working poor Hoosiers now receiving health insurance through the new Healthy Indiana Plan. The program, championed by Republican Gov. Mitch Daniels, receives the bulk of the $140 million a year lawmakers generated by raising the cigarette tax to 99.5 cents a pack.

Brown said he plans to begin a discussion on possible improvements to the cigarette tax funded health care programs when Roob appears before a legislative study committee later this month.

Democratic gubernatorial hopeful Jill Long Thompson wants to commandeer the roughly $12 million lawmakers set aside for the employer insurance incentive and use it to support a proposed purchasing pool aimed at lowering health care costs for small business.

"We believe that would have a much more profound impact on individuals and small businesses," said Long Thompson spokesman Jeff Harris. He said bulk purchasing could lower costs for small businesses already offering employee health insurance and encourage more employers to extend coverage. And some of the money would go to tax credits for firms that join the purchasing pool, which initially would be geared toward companies with fewer than 50 employees.