Healthcare reform one year later: Moving small business forward
John Arensmeyer
Luck, however, had nothing to do with it. Mark’s a savvy business owner, and more important, an informed one. After healthcare reform was passed a year ago, he educated himself about the law and jumped on one of the first small business-focused provisions to go into effect: healthcare tax credits. Those credits, which will plant $15,000 back in his coffers, gave Mark, who was on the fence about hiring a new employee, the confidence to do so.
As we mark the first anniversary of the passage of the Affordable Care Act, it’s important to remember who it was enacted to help: folks like Mark Hodesh, his new worker, who was unemployed before joining Mark’s crew, and the 28 million other small business owners who needed relief from a broken system that discouraged entrepreneurship and stunted economic growth. And on a more personal level, it was passed to help those employers who wanted to do right by their employees and offer benefits but couldn’t because of outrageous costs and scurrilous insurance practices.
An economic analysis released by Small Business Majority and based on modeling by MIT economist Jonathan Gruber concluded that without reform, small employers would shell out $2.4 trillion to cover healthcare costs by 2018, and 178,000 small business jobs and $52.1 billion in profits would be lost. In the world beyond ledgers and red ink, real people would have been hurt. Mark Hodesh’s new employee, for one, would likely be back in the unemployment line. No matter where on the political spectrum you fall, that’s a grim picture.
Despite rhetoric claiming otherwise, the ACA is stocked with provisions aimed at reducing small businesses’ healthcare costs and ensuring they have access to quality, affordable insurance. For instance, four million small businesses are eligible now for the same tax credit Mark Hodesh will receive. Unfortunately, this benefit, along with many others, gets lost in the political theater surrounding the act. That’s a shame because, as we found in a national survey of small business owners released in January, 57 percent don’t know the credits exist. But once they learn about them, one-third who don’t offer insurance said they would be more likely to do so.
For many small businesses, tax credits aren’t just an appealing idea floated in a survey; they’re much-needed dollars flowing back into their cash registers this year. Dollars that enable entrepreneurs like Mike Hodesh to hire new employees; dollars that let people like bookshop owner Betsy Burton of Salt Lake City -- who just last year faced the demoralizing decision to either drop her business’s health plan or lay off workers to contain costs -- to continue offering coverage.
These are the success stories we hoped to see when the president signed the bill into law. But tax credits are not the end of the story. By 2014, states will create health insurance marketplaces where small businesses can pool their buying power and drive down costs. And insurance companies will no longer be able to refuse coverage because of preexisting conditions—a reality that stifles entrepreneurship because many creative and hardworking people are scared to start a business without coverage.
Opponents of reform want to reignite the debate we’ve had for two years over the ACA, but we don’t see the point. The act is working for small business. It’s time to move forward. It’s time to let Mark Hodesh and Betsy Burton focus on the health of their business rather than worry about a sickly bottom line. It’s time to let states begin creating insurance marketplaces that will lower the cost of healthcare. And it’s time to let the spirit of American entrepreneurship flourish and drive our economy to new heights.
John Arensmeyer is the founder and CEO of Small Business Majority (www.smallbusinessmajority.org), a small business advocacy group based in Washington, D.C.
Comments
actionjackson
Sat, Mar 26, 2011 : 2:53 a.m.
I liked my plan. I kept it.
AAresident
Fri, Mar 25, 2011 : 12:18 p.m.
Our health care system is broken. It's good that small businesses like Downtown Home and Garden receive some benefit, but for most of us, this health care reform will not help the ever increasing cost and not so wonderful quality of the American business model for health care.
Diagenes
Wed, Mar 23, 2011 : 3:17 a.m.
Obamacare has been working great for the more than 700 companies and labor unions that have asked for waivers to be exempt from the law. It works great for the State of Maine which is exempt from the law as well. The state of Nebraska thinks its great too because their increase in future Medicaid expenses will be covered by the feds. Not so good for Michigan because Liberal Debbie Stabinow and Carl Levin sold their vote before the bidding got high enough. Its not so good for the seniors who lost their Medicare Advantage plans, even though Pres. Obama said "if you like your plan you can keep it". Was he lying or just misinformed?
outdoor6709
Tue, Mar 22, 2011 : 1:12 a.m.
Let me get this straight. Taxpayers are $14 trillion in debt to the Chinese and in order to make health care more affordable, the governmemt gives business $15,000 per employee. And I am supposed to think this is a great idea. And you think I am the one out of touch with reality.
gsorter
Mon, Mar 21, 2011 : 3:16 p.m.
I am a small business owner here in town with between 12 and 15 covered employees, and am glad Obama has ridden to my rescue against those mean insurance companies. Too bad, I, like tecnojunkie can't take matters into our own hands with high deductible HSA plans, since I might be able to squirrel away too much money in that. Too bad that I still have to declare my premium costs as income, since we are an S-corp. Too bad I almost had to give a 1099 to the gas company, electric company, office supply store, etc. Too bad this plan won't bend the curve of health care costs downward at all. And finally, I'm so happy that we have the new convoluted rules that determine whether or not I am "grandfathered" or not. I may find that it is cheaper to just drop all coverage, and pay the penalty.
John B.
Wed, Mar 23, 2011 : 11:48 p.m.
Have a nice day!
Garrett
Mon, Mar 21, 2011 : 2:20 p.m.
And again progressives and liberals have dragged conservatives, kicking and screaming, into a new century... From the article: "...we found in a national survey of small business owners released in January, 57 percent don't know the credits exist. But once they learn about them, one-third who don't offer insurance said they would be more likely to do so." It's a shame really that the lies perpetrated about this bill by the right is hurting small business owners and thus the economy of this country. Glad to see the truth is beginning to come out.
Technojunkie
Mon, Mar 21, 2011 : 1:15 p.m.
Or people could buy high-deductible insurance for a fraction of the cost of full coverage, use the cost difference to pay cash for routine expenses and have money left over, and help to wipe out the jobs of many thousands of paper-pushing bureaucrats. I've been happy with mine. Now I'm not dependent on an employer for health insurance. I can see any doctor I want without asking some bureaucrat's permission first. Unless something catastrophic happens like getting hit by a truck I generally don't bother to file a claim. Paperwork = waste. Unfortunately the ACA has made my affordable high deductible coverage illegal so if you want insurance rather than overpriced, bureaucratic, prepaid medical care "insurance" you're out of luck. That will mean lots of jobs for paper-pushers and propagandists but it won't help to provide actual health care. But ooooh, the government will give you subsidies now! Bernanke has this neat device called a printing press that makes all the money anyone could want! What could go wrong? But hey, that's corporatism for you.
1bit
Mon, Mar 21, 2011 : 2:57 p.m.
1. High deductible coverage is not "illegal" under the ACA. 2. Most people are happy with their health care plans because they're not sick. Wait until you have a serious injury or illness and see how happy you are with your plan. It's similar to car or home insurance - you don't know how bad your plan is until you need it.
tim
Mon, Mar 21, 2011 : 12:19 p.m.
The reason people don't get excited about " scurrilous insurance practices " is because they don't know they exist until it's too late. Not until the hospital tells you that your not covered that you know how bad your insurance policy is--- and lets face most people aren't sick.
David Briegel
Mon, Mar 21, 2011 : 11:30 a.m.
John, Excellent article. The Affordable Care Act is a giant step forward for our nation as it will have a positive impact on all business, especially small business and our fellow citizens. If people would get as excited about "scurulous insurance practices" as they do the trial lawyers we would be much better able to put this in proper perspective. Progress. One giant step forward!