Supreme Court Decision a Victory for Small Businesses Looking for Relief from High Healthcare Costs

John Arensmeyer

John Arensmeyer

Statement originally issued on June 28, 2012:

The U.S. Supreme Court’s ruling today upholding the Affordable Care Act is a victory for small business owners who have struggled with the excessively high cost of health insurance for decades. The Affordable Care Act tackles small business owners’ top priorities when it comes to healthcare reform: cost and accessibility. The law will significantly rein in costs while providing more health coverage options for entrepreneurs.

Our opinion polling has found that small businesses support the law, believe healthcare reform is needed to fix the economy and they support key provisions, particularly the healthcare exchanges and tax credits. Many components of the law, including rate review and the Medical Loss Ratio provision, have already resulted in lower premium costs for small employers. It also help ends “job lock,” where a prospective entrepreneur who has a preexisting medical condition cannot leave their job, launch a new company or help grow the economy because they are locked in their job for health benefits. And in 2014 the law calls for health insurance exchanges to be set up in every state, which will do even more to curb costs and boost choice. State lawmakers who have blocked implementation must now step up to the plate and work with local small businesses to establish these new competitive marketplaces.

The political circus that has surrounded this law for the past two years hasn’t done anything to help small business owners struggling with high costs. Today’s ruling lets us get back to what’s important: implementing the law and getting small business owners the financial relief they’ve been waiting for.

Plurality of Small Business Owners Want Healthcare Law Upheld; Only One-Third Want it Overturned

John Arensmeyer

John Arensmeyer

Originally released June 14, 2012:

A plurality (50 percent) of small business owners want the healthcare reform law upheld—either as is or with minor changes—while only one-third want the Supreme Court to overturn it, according to opinion polling released today by Small Business Majority. However, after learning more about the law, a clear majority (56 percent) want it kept intact with, at most, only minor changes.

The Supreme Court is expected to hand down its decision any day in the case against the Affordable Care Act, filed by the National Federation of Independent Business (NFIB) and state attorneys general. The polling of 800 small business owners in eight states (Florida, Illinois, Louisiana, Michigan, Missouri, New York, Texas and Virginia) found that once small business owners learn more about the law, their support for keeping it intact—either as is or with minor changes—rises to 56 percent, while opposition falls to just 28 percent.

Contrary to popular belief, small business owners do not want the high court to throw out the Affordable Care Act. They see this law as helping everyone have coverage and bringing down healthcare costs—something that has been one of their top concerns for years. We hope Supreme Court justices understand how important this law is to small businesses who need relief from high healthcare costs.

Key provisions of the law also have strong small business support, including one of the most crucial components for small businesses—the health insurance exchanges. The Affordable Care Act calls for exchanges—online marketplaces where small businesses can pool their buying power when purchasing coverage—to be up and running in every state by 2014. Sixty-six percent of owners say they would use their state exchange or consider using it to provide their employees with health benefits. The majority of entrepreneurs find potential features of the exchange very appealing, including employee choice (76 percent), the exchange educating employees about plans (74 percent), and the exchange providing plans that offer prevention and wellness programs (77 percent). Additionally, a strong majority (66 percent) of small businesses support their state applying for federal funds to set one up.

“Small businesses have been at the center of this lawsuit, and everything I hear is that they want it overturned. That’s not true for me, and it obviously isn’t true for the majority of my fellow entrepreneurs,” said Mark Hodesh, owner of Downtown Home and Garden in Ann Arbor, Mich. “I sincerely hope our Supreme Court justices listen to what real small businesses are saying about this law, not what a select few are saying for us, and that they uphold it. Going back to the status quo would be unthinkable.”

Other key findings from the poll:

  • 55 percent of small businesses who support upholding the law believe it should be kept because we need to make sure everyone has health coverage; more than one-third say it’s because it will make it easier to purchase insurance
  • 72 percent support the medical loss ratio requirement, where insurers are required to spend at least 80 percent of premiums on healthcare claims and quality improvement efforts
  • 65 percent support “rate review,” where state regulators are allowed to review and approve or reject insurers’ increases they deem excessive
  • 78 percent support prohibiting insurers from denying coverage based on preexisting conditions
  • 69 percent support preventing insurance companies from basing insurance rates on health status; 73 percent support preventing insurers from charging women higher rates than men
  • 69 percent favor allowing young people up to age 26 to stay on their parents’ plans
  • 55 percent of small business owners provide insurance to at least some of their employees, but of those who don’t offer it, 70 percent say it’s because they can’t afford it
  • Of small businesses who do offer benefits, respondents said the two most compelling reasons to offer were that they had a responsibility to offer (47 percent) and because it helps retain good employees (47 percent)
  • Of the small businesses who qualify for a tax credit under the law, but were not taking advantage of it, nearly half (46 percent) said they weren’t using it because they were not aware it existed
  • Nearly half of all small businesses (49 percent) said they’d be more likely to offer insurance if they qualified for a tax credit and the same percentage said they’d be more likely to purchase insurance through an exchange if they could receive a tax credit
  • 51 percent of small businesses are interested in establishing a workplace wellness program

To read the full report go online to http://www.smallbusinessmajority.org/small-business-research/healthcare/small-business-owners-views-on-aca.php

Small Firms Create Majority of New Jobs in May; Robust Policies Can Help Keep it Up

John Arensmeyer

John Arensmeyer

Original statement issued on June 1, 2012:

Our nation’s smallest businesses—those with 1-49 employees—continue to outpace large businesses in the race to put America back to work. Businesses with fewer than 50 employees created more than half of all new jobs last month, and, from April to May, they boosted the actual number of jobs they generated by 16 percent, according to data released Thursday by Automatic Data Processing, Inc (ADP). Small businesses overall accounted for more than 93 percent of all new jobs last month, while large businesses created just 6.8 percent of new jobs.

These figures underscore the starring role small businesses have in helping lower the unemployment rate, and they’re a reminder that the smallest firms are our country’s primary job creators. These businesses can and will put our economy back on track, but they can’t do it singlehandedly. Legislators must continue pursuing pragmatic economic policies that ensure entrepreneurs have they tools they need to keep rebuilding the economy. We suggest:

  • Calling on the Federal Deposit Insurance Corporation (FDIC) to issue bank charters that would supply small firms with more credit. The agency has not issued a single charter this year, despite the dismal lending landscape entrepreneurs continue to face: our national opinion polling found 90 percent of small business owners view credit availability as a problem.
  • Passing the Small Business Jobs and Tax Relief Act, which would promote small business job creation by providing a 10 percent income tax credit for increased payroll in 2012 while also extending the 100 percent expense deduction for equipment that lowers owners’ after-tax costs.
  • Extending the Production Tax Credit for wind project development, as it supports 37,000 jobs that would be at risk if the credit expires. Not only would extending this credit protect existing jobs, small business owners also indicate it could help generate new jobs: 7 in 10 small business owners believe government investments in clean energy play an important role in boosting the economy and creating jobs now.
  • With ADP’s latest data highlighting small businesses as invaluable assets to the economy, it’s clear we must support them with pragmatic solutions that address their greatest concerns. We encourage lawmakers to pursue robust policies such as those listed above, as failing to do so would only hamper our fiscal recovery.