Help on the Way for Small Businesses Struggling With Health Care Costs

Huffington Post

This week marks the third anniversary of the health care law’s passage. Given the amount of airtime the law still gets, it’s hard to believe the Affordable Care Act has been on the books that long. The law continues to generate controversy from the corridors of Capitol Hill to the sidewalks of Main Street, but in fact many important provisions impacting our country’s primary job creators have been quietly helping small business owners better afford health insurance. However, next year when the bulk of the law’s provisions go into effect, we’ll see even more changes that will help rein in insurance costs for small employers and the millions they employ.

The most important provision coming online in 2014 are the health insurance exchanges, which are the cornerstone of the new law for small businesses. In a nutshell, the exchanges will be a one-stop shop where small businesses can find the right health insurance policy for their needs and budget. 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.

In the past, the high cost of health insurance made it difficult for many small business owners to offer health insurance to employees. In fact, Small Business Majority’s opinion polling found of those small business owners who don’t offer coverage to their employees, seven in 10 say it’s because they can’t afford it. Additional research found that 56 percent of small business owners offered health insurance to their employees in 2011, which is significantly less than in years past. The Affordable Care Act, and exchanges in particular, will help change that. Our polling found 66 percent of small business owners say they would use an exchange or at least consider using it, compared to a mere 8 percent who say they would not.

Besides allowing small business owners to pool their buying power, the exchange will give them access to support tools enabling them to compare plans and make meaningful choices. The current health care market is incredibly difficult to navigate. Bringing transparency to the costs of services and products in the exchange will enhance entrepreneurs’ decision-making ability, pushing insurers and providers to be more upfront with price information and giving entrepreneurs much-needed clarity as to where their health care dollars are going.

With open enrollment for the exchanges fast approaching in October, it’s important to note that small business owners are also supportive of specific elements of this new marketplace. Three-quarters would want the exchange to provide plans offering prevention and wellness programs and 74 percent hope the exchange educates employees about their plans and helps them enroll, which would do a great deal to cut down on business owners’ administrative duties.

Despite what some politicians or talking heads might say, entrepreneurs support many elements of the law in addition to the exchanges. Our polling found nearly 8 in 10 small business owners support prohibiting health plans from denying coverage based on preexisting conditions, and 72 percent support requiring insurance companies to spend at least 80 percent of small group premiums on patient care and quality improvement, as opposed to plan administration, marketing and profits. Additionally, 65 percent support allowing states to review and potentially reject excessive premium rate increases.

It’s critical small business owners are aware of the many benefits the new law offers. The fact that small businesses have been suffering from high health care costs for decades isn’t front-page news, but that something is coming online soon to help them is.

Arensmeyer: Small Businesses? Sequester Advice Is to Plug Corporate Loopholes

John Arensmeyer

John Arensmeyer

Originally featured in Roll Call:

Small businesses are critical to our economy. In fact, they generate, on average, 6 in 10 net new jobs. Fortunately for our leading job creators, Congress took an important step at the beginning of the year to protect them and their core customer base by extending income tax cuts for the middle class, as part of the fiscal-cliff deal. But lawmakers now have another economic obstacle in their path: the sequester — a host of automatic spending cuts that began March 1 because lawmakers couldn’t agree on a deal to reduce the deficit. These across-the-board cuts could have dire consequences for the economy and small employers. But all is not lost. There are still some areas in the budget where Congress can quickly pick up revenue to avoid the bulk of the cuts.
Unfair tax loopholes funnel billions of dollars into major oil and gas company coffers every year. Political leaders on both sides of the aisle have pointed to the need to get rid of them, and small employers agree.
Small Business Majority’s opinion polling found three-quarters of entrepreneurs support ending government subsidies to oil and gas companies. What’s more, 6 in 10 believe we should rein in the oil industry even if it means a small increase in gas prices.
If that sounds surprising, it shouldn’t, given our budget crisis. The sequester will reduce funding for everything from defense to infrastructure to small-business loan programs. It will cost the nation 1.5 million jobs and half our economic growth in 2013, according to the nonpartisan Congressional Budget Office.
That’s why spending cuts need to be wielded with a scalpel, not a chainsaw. Closing tax loopholes is part of a balanced approach to this crisis, and entrepreneurs agree it’s necessary. In fact, 92 percent believe big corporations’ use of loopholes is a problem, and three-quarters say their own business is harmed when corporations use them to avoid taxes.
It also doesn’t help small businesses or the economy as a whole when special tax treatment is given to hedge fund managers and Wall Street powerhouses. The controversial “carried interest loophole” lets finance titans pay a top tax rate of 20 percent on part of their earnings, only half of what they would pay at the top rate for normal wages and salaries. This puts other taxpayers at a huge disadvantage, including small-business owners. Our polling shows two-thirds of entrepreneurs believe hedge fund managers should have their incomes taxed at normal rates.
The bottom line is that policymakers concerned about our economy should be leveling the playing field for small businesses, not perpetuating tax breaks for the big boys. The CBO estimates that ending subsidies to gas and oil companies would shore up $40 billion over 10 years and closing the carried interest loophole could raise $21 billion. Together, these measures would significantly offset cuts caused by the sequester.
However, finding short-term solutions to ongoing budget crises shouldn’t be the end goal. Small businesses want policymakers to resolve this problem for the long term so they and our economy have the sustained fiscal certainty they need to thrive.