Some small business groups favor Obamacare listen09/30/13 Janelle Irwin
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Insurance marketplaces open in states nationwide Tuesday for people to shop for subsidized health insurance. Small businesses will also be able to choose more competitive policies for their employees starting in November. During a conference call Monday with the group Small Business Majority, founder and CEO John Arensmeyer said the marketplaces will lead to more employers offering health benefits to their employees.
“In fact, our polling has found that, of those small business owners who don’t offer coverage, more than 8 and ten say it’s because they can’t afford it. The insurance marketplaces really are going to help that. We found in our polling that two thirds of small business owners say that they would use an exchange or at least consider using it compared to a mere 8% who say they would not.”
Some small businesses have taken advantage of a provision in the Affordable Care Act that provides tax credits to those employers who offer health coverage. But even for companies who don’t qualify for a credit, Arensmeyer said the marketplace will still be a cost-saving tool.
“It will enable them, for the first time, to band together and leverage their buying power giving them the kind of clout large businesses currently enjoy and narrowing the gap that now exists in costs where small businesses pay 18% more than large businesses for the same coverage.”
Critics of the law argue the 2015 mandate that businesses employing more than 50 people must offer coverage to any employee working 30 hours or more is a burden forcing companies to scale back hours. According to NBC News, St. Petersburg College cut back hours for adjunct professors this semester. Giants like Wal-Mart also steered away from offering full-time status to some workers. But president of the U.S. Hispanic Chamber of Commerce, Javier Palomarez, said the insurance marketplace adds opportunity for many of those workers to obtain quality coverage without further burdening businesses.
“Hispanics are more likely to be uninsured than any other group of Americans and under the ACA provisions already enacted, nearly one million young Hispanics aged 19-25 have gained coverage under their parent’s health plan.”
Staunch distaste for the Affordable Care Act is careening the government toward a possible government shutdown tomorrow. But even if that happens, it’s not likely to affect implementation of the insurance marketplace. According to PolitiFact, the subsidies offered through the marketplace qualify as an entitlement. Such programs aren’t subject to a shutdown. The funding for the provision is also considered a long-term appropriation and is also unlikely to be affected. Small Business Majority’s Arensmeyer said it’s important to continue to get the word out so employees and employers understand their options.
“Right now we have a situation where someone who stays stuck in a job they’d rather not be in just because of health coverage and it’s really crazy. It really is a -- sort of depresses the incentive to become an entrepreneur if you have to worry about health coverage and under the new law that will change.”
The healthcare law offers cost savings options for employers who already offer health insurance. Jarek Steele is an independent bookstore owner in Missouri.
“To put this cost into perspective, the average paperback retails at about $15 and of that we pay about $8.25 to the publisher leaving us with $6.75 to pay all of the other expenses – rent and payroll and electricity. That means that had to sell 40,082 paperbacks at full cost to pay for health insurance alone since 2009.”
By using the insurance marketplace, Steele’s business may be able to offer employees better coverage at lower rates. And Mike Bray, owner of a small retail chain in the Washington D.C. area, said he expects both savings and expanded options.
“Thirteen insurers announced plans to offer on Maryland’s shop exchange. So, at the very beginning when all I’m hearing is bad news, it looks like I’m going to have, on October 1st, quadruple the choice of insurers that I had before just overnight, stroke of the pen.”
Florida is one of several states that has not accepted federal funding to expand Medicaid. Because of that, individuals with income below the federal poverty level do not qualify for the tax credit under the insurance marketplace. Many of those individuals may have qualified for Medicaid had Florida expanded its program. Members of the small business community including Arensmeyer, didn’t weigh in on the issue when pressed about how the decision would affect employees.
“We’re sorry that not every state has chosen to that because it does create the gap. It doesn’t really affect the issue for small business owners on the small business exchanges though. They’re really two separate issues.”
The Small Business Health Options Program, or SHOP, was supposed to open Tuesday along with the Health Insurance Marketplace for individuals. Businesses will be able to view options tomorrow, but will have to wait to purchase plans. Individuals can compare plans on their website.