What Small Business Owners Should Know About Healthcare Reform
There are many complex policy issues that have a major impact on the small business community. Each week, we’re going to help break one of those issues down so small business owners can stay in the know and remain aware of their stake in these national issues. This week’s Issue Q&A is on healthcare reform.
Q: How has the Affordable Care Act impacted small business access to healthcare?
A: Implementation of the Affordable Care Act has removed a significant impediment to entrepreneurship. No longer is healthcare coverage tied to a job working for another employer. Would-be entrepreneurs can now pursue their dreams of starting their own business knowing they will have access to affordable health coverage. For small businesses, there is a wealth of options available to provide affordable coverage to employees, allowing smaller firms to compete for highly skilled workers.
Q: What steps can lawmakers take to ensure the healthcare law is working best for small businesses?
A: One way to strengthen the Affordable Care Act for small businesses is making sure the federal Small Business Health Options Program (SHOP) functions properly when it’s released online on November 15. SHOP allows small businesses with fewer than 50 employees to band together when buying coverage, granting them the kind of purchasing clout larger corporations enjoy. Small employers that offer coverage through the marketplace may also be eligible for a tax credit of up to 50% of the premiums.
A properly implemented SHOP marketplace relieves hard-working small business owners from spending countless hours trying to navigate the healthcare market. Following a year’s delay with no online front-end available in the federally run SHOP marketplaces, getting a working online system up and running would be a real win for small businesses.
Q: Do employees of small businesses have any choice in their health coverage?
A: Yes! In fact, employee choice is key in distinguishing the new insurance marketplaces from the outside health insurance market, and small businesses are very supportive of this feature. Our scientific opinion polling found two-thirds of small employers believe allowing employees to choose among multiple carriers is a huge benefit of the ACA.
In June 2014, the Obama administration released a rule allowing states to delay the implementation of employee choice in SHOP until 2015. This rule has allowed half the states with federally run programs to opt out of the ACA-mandated requirement that the SHOP marketplace allow employees to choose among multiple insurance carriers. This harms small businesses in those states and puts them at a competitive disadvantage with big business. Including employee choice in all SHOP marketplaces as quickly as possible can reverse a longstanding market trend that’s left small employers on unequal footing.
Q: What about self-employed individuals?
A: There are more options outside of SHOP for self-employed individuals and small businesses not in a financial position to purchase employer-sponsored coverage. Since none of our nation’s 22 million self-employed people are eligible to purchase coverage in SHOP, they have options available to them in the individual healthcare insurance marketplaces. It’s important that lawmakers also continue to support maximum outreach and education efforts to inform these self-employed individuals about their options and access to health coverage under the ACA.