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.

Don’t Forget About the Small Business Healthcare Tax Credit

John Arensmeyer

John Arensmeyer

Originally featured in The Huffington Post:

With tax day rapidly approaching, small business owners still have a chance to cash in on a health care reform provision reserved just for them: health care tax credits. The Affordable Care Act was designed to address one of small business owners’ most serious problems — a lack of access to affordable coverage. Since its enactment, employers across the country have been able to claim the credit and reinvest in their business. Nan Warshaw, owner of Bloodshoot Records in Chicago, Illinois, is one of them.

Nan was able to save nearly $6,000 with the Affordable Care Act’s small business tax credit in 2010, helping offset her group coverage cost. “We’re still filing our 2011 returns, but we anticipate saving nearly that amount again,” she said. “With us paying the full contributions for our employees’ insurance, it really is a relief to get some help with those costs — and this is certainly the first time we’ve been financially rewarded for looking out for their wellbeing.”

Nan is one of hundreds of thousands of employers already seeing her health care costs decrease with the help of the tax credits. According to national opinion polling we released in 2011, one-third of small business owners who currently don’t offer health coverage are more likely to start doing so because of them, and 33 percent of employers already offering it said they’re more likely to continue doing so.

Currently, businesses with fewer than 25 full-time employees who pay at least 50 percent of total premiums are eligible for a credit of up to 35 percent of their premium contribution. In 2014, that will jump to 50 percent. For a rough estimate of how much your business could save, check out Small Business Majority’s tax credit calculator.

In this tough economy small business owners are struggling to compete, and in some cases, just keep their doors open. Like some of the law’s other key components, the tax credits are intended to boost entrepreneurs’ bottom lines, bettering their chances of offering quality coverage. Some use it to become more competitive by bulking up benefits packages, while others purchase new equipment. Still others put it toward their employees’ share of premiums.

For Ron Nelsen, owner of Pioneer Overhead Door in Las Vegas, Nevada, the credit eased worries that group costs might spiral so far out of control that he’d be robbed of his commitment to offering insurance. “When I heard about the new health care law, I was relieved something was finally being done to help entrepreneurs like me,” he said. “In 2010, I got back $2,235 just for offering insurance to deserving employees. And this year, I received even more. Most importantly, I’m not thinking about having to tell the guys they’re on their own when it comes to health insurance.”

Nationally, 309,000 small businesses saved money through this provision in 2010. An even larger number should benefit this year. And research shows the uptake could be even greater. Our opinion poll found 57 percent of small business owners do not know about the tax credits. It’s time to change that. To help them, we must get the word out and do everything we can to make sure this important provision is taken advantage of. In this economy, every little bit helps.

Virtual, Easy-to-Use Brochure Walks Small Businesses Through Ins and Outs of Healthcare Reform Law

John Arensmeyer

John Arensmeyer

Original statement issued on March 23, 2012:

Today, Small Business Majority released an easy-to-use online resource called the “Actual Factual brochure,” which small business owners can use to learn how the 2-year-old healthcare reform law impacts their businesses.

National small business advocacy organization Small Business Majority released a virtual version of the Actual Factual brochure, which was developed and produced by Ascension Health, the largest nonprofit health system in the nation. Presented in an easy-to-use flipbook format that can be accessed from all mobile devices, it puts important information about the law at small business owners’ fingertips.

“The nation’s small businesses are critical to achieving 100 percent access to healthcare,” said Susan Nestor Levy, Chief Advocacy Officer, Ascension Health and Executive Vice President, Ascension Health Alliance.“To help spread the word about the provisions in the law that help small businesses provide health insurance to their employees, Ascension Health developed the Actual Factual brochure. By making it available in a virtual, easy to flip-through format, we hope even more small businesses will learn about the law and take advantage of the provisions aimed at helping them.”

The healthcare landscape is shifting as the market adjusts to provisions of the Affordable Care Act, signed into law on March 23, 2010. The Actual Factual brochure, which details provisions of healthcare reform pertinent to small businesses, walks small business owners through the ACA provisions such as healthcare tax credits, small business exchanges and various cost containment measures aimed at lowering costs throughout the system.

“As the Affordable Care Act continues bringing changes to the healthcare system, it’s essential to disseminate clear information about how this law impacts our job creators,” said Small Business Majority CEO John Arensmeyer. “This brochure allows them to have this information literally at their fingertips, so wherever they are—be it their business, a job site or meeting with clients—if they have questions about the law they can access a resource that will give them clear, easy-to-understand answers.”

Report Gives Lawmakers Tips on Creating Health Insurance Marketplaces for Small Businesses

John Arensmeyer

John Arensmeyer

Politicians and pundits have focused a lot of attention on the Affordable Care Act’s requirement that everyone have health coverage, but few have looked into the health insurance marketplaces—the component of healthcare reform most important for small businesses. Fortunately, people are beginning to pay closer attention. On Monday, the Department of Health and Human Services released new guidelines state lawmakers can follow when setting up the marketplaces, also known as exchanges. If lawmakers set them up right, these marketplaces will allow small businesses to pool their buying power, driving down costs and allowing them to purchase high-quality insurance at lower rates just like big businesses.

The states are charged with implementing the exchanges by 2014, but only 10 have moved forward with legislation necessary to create them. The longer states wait, the more they risk missing the 2014 deadline and having HHS create the exchange for them. States should set the exchanges up themselves because they have more insight into the needs of their small business owners. States that do not pass legislation this year will find it challenging to build a successful exchange by 2014.

There is help out there for lawmakers willing to tackle the hard but necessary work of setting up the exchanges. The Center for American Progress and Small Business Majority issued a report on July 6 that will help legislators make sense of those rules and provide a roadmap they can follow to create a robust exchange that will significantly lower small business owners’ premiums and give them more options for high-quality health insurance. The report focuses on the intricacies of creating an exchange, provides examples of successes and failures experienced by states that have already created them and offers advice on how to get it right the first time. Small business owners like Walt Rowen, owner of Susquehanna Glass Company in Pennsylvania, are counting on lawmakers to do just that.

The Columbia-based small business, which opened its doors more than 100 years ago, survived the Great Depression, wartime and the recent economic downturn by ensuring its factory stays efficient and diversifying and expanding the type of work it does. But soaring healthcare costs—one increase came in at an outrageous 160 percent above the previous year’s rate—had Walt wondering if the company had finally encountered an obstacle it couldn’t overcome. If done right, health insurance marketplaces will make volatile premium hikes like his 160 percent zinger a thing of the past and the glass company can thrive for another 100 years and beyond.

Lawmakers have a host of important decisions to make when creating an exchange, such as whether it should be an active or passive purchaser, what role brokers should play and whether the exchange should cater to individuals and small businesses jointly or separately. But these issues are just a fraction of the whole. Healthcare reform, and exchanges in particular, are expansive and complicated; policymakers must give themselves time to sift through the complexities. Roadmaps like the one released last week will help legislators smoothly implement these complex reforms. State officials have the chance to drive our nation’s chief job creators down the road to less financial burden and more economic opportunities through state exchanges. Walt Rowen, and millions of other small business owners like him, are counting on them to get it right.

Healthcare Reform Ruling Comes Down on the Side of Small Business

John Arensmeyer

John Arensmeyer

The Affordable Care Act was signed into law more than a year ago, but in true democratic fashion the debate about whether it should remain on the books is far from over. Opponents of the law have been waging one court battle after another trying to have it ruled unconstitutional. But on June 29, the 6th Circuit Court of Appeals issued an encouraging ruling: the Affordable Care Act is constitutional.

The ruling is the latest in a handful of court decisions reaffirming the right of Congress to enact the law. The panel of three judges—two of whom were appointed by Republican presidents—determined that Congress had the power to pass the Affordable Care Act under the Commerce Clause of the Constitution. We hope this will put the tired debate over the constitutionality of the new healthcare law to rest because there is a lot in the law that will give small businesses the relief they need from soaring healthcare costs.

The court case focused on the minimum coverage requirement provision of the ACA. This requires everyone in the United States to have some type of health coverage by 2014, whether through a private plan, employer-based health insurance or a public plan like Medicare or Medicaid. The judges agreed with many constitutional law experts on this subject: Congress did not overstep its legal authority when making this requirement.

It’s refreshing to see two judges from different political parties confirm the constitutionality of the minimum coverage requirement. They were able to look past the partisanship that has gripped the national debate on healthcare reform and make a decision based on the law.

Opponents of healthcare reform haven’t been able to defend the merits of their argument because the facts aren’t on their side. They can’t say that the status quo was working because it wasn’t—small business owners and their employees can attest to that. Small businesses have been losing coverage at an alarming rate thanks to the increasing unaffordability of insurance and inaccessibility to plans that fit their needs. The RAND Corporation estimates that the ACA will boost employer health insurance offer rates from 57 to 80 percent because of, among other things, lower premium costs resulting from healthcare exchanges and tax credits. A study we released with Families USA found that more than four million small businesses—87 percent of all small businesses in the country—are eligible for tax credits to help cover the cost of health insurance.

Opponents also claim that the reform measures will add to the national debt and increase government spending, yet the nonpartisan Congressional Budget Office’s analysis found that the ACA will reduce the federal deficit by $143 billion by 2020 and by another $1 billion the following decade. This is an important point to consider as lawmakers debate whether to raise the nation’s debt limit. The Affordable Care Act will improve our nation’s fiscal woes by taking direct aim at rising costs across the entire healthcare system and making the reforms necessary to reduce waste, fraud and abuse and improve the effectiveness of every dollar we spend.

Most importantly, opponents’ efforts to thwart the law won’t make the situation any better for small businesses and the millions they employ. Striking down the law would only make things worse; health premiums would continue to increase at exponential rates and more and more individuals would be left uninsured. It was reassuring Wednesday to see fair and impartial judges stand on the side of reason and ensure that won’t happen any time soon.