March 31, 2010. Retrieved online: April 1, 2010, from GABRIEL VASQUEZ, Las Cruces Bulletin
The $938 billion behemoth – the sweeping health care reform signed into law by the president Tuesday, March 23 – promises to change the way Americans receive health care. It also brings a crucial transformation in the way small business owners purchase and provide health insurance for their employees.
Some small business owners feel optimistic about the bill, but most are uneasy about the legislation, which inflicts stiff penalties on businesses with 50 or more employees that don’t buy in to the soon-to-be state-created insurance pools or provide minimum benefits through a private insurer.
“Any time you’re looking at a potential cost increase in any place on your balance sheet, you’re going to have make some strategic decisions,” said Tom Hutchinson, owner of La Posta de Mesilla. “But it’s too early to tell the impact. Some of our own congressional representatives don’t yet know the impact. That’s part of the dilemma that many (small business owners) have – the uncertainty, and uncertainty is never good for small business.”
Hutchinson, who employs just under 50 full-time employees and 50 part-time employees, said he’s not perused through the 2,000-plus pages of HR 4872 and HR 3590, but will work closely with his accountant and legal counsel to see what, if any, restructuring he must make within his business to prepare for the new rules.
“Right now I have insurance availability through a state-supported program. Will this new bill enhance that or not? I don’t know,” he said. “It’s a big question for me right now.”
By no later than 2014, states will have to set up small business health options programs (SHOP exchanges), where small businesses will be able to pool together to buy insurance. Congress defines small businesses as those with 100 employees or less.
The U.S. Congressional Budget Office estimates the insurance pools would reduce premiums for businesses in the small-group market by 1 to 4 percent. It’s estimated that nearly 13 million small business employees are uninsured.
Hutchinson, who sits on the board of the National Restaurant Association, said he and his colleagues have been averse to the legislation since it was first introduced.
“The (restaurant) association has lobbied Congress the past 18 months to let them be aware of the issues within the restaurant industry and with other businesses throughout the country,” he said. “There are unintended consequences of major legislation like this. The devil is in the details when it comes to these things.”
… Tim Query, professor of risk management and insurance at New Mexico State University, said the new reform is a short-term fix for rising premiums but could be detrimental to small business in the long term.
“This health care bill offers some small businesses subsidized relief from rising health care costs in the short term,” he said. “However, in the long term it will inevitably increase taxes for small businesses (and their customers) and add yet another government mandate that may end up costing many employees their jobs.”
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