Small business owners have big problems with legislation
Written by JORDAN CRAVENS Sentinel Staff Writer
Saturday, 22 June 2013 08:20
Tensions rose Friday during an "Affordable Care Act 101" forum at Wood County Hospital for local small business owners.
Small business owners, health care coverage consultants, money lenders and representatives from the U.S. Small Business Administration's Cleveland District Office all came together for the meeting.
The goal of the forum was to educate business owners on the impacts of the legislation and to clarify some myths surrounding its implementation.
But even as the "101" of the legislation was explained, more questions and concerns over potential skyrocketing health care costs and uncertainty on the parameters of the act did not sit well with several people in attendance - specifically the health care coverage consultants who work with local businesses. Voices were raised, questions and answers were interrupted, and obvious signs of frustration could be seen.
One business owner, as he was walking out of the forum, told an SBA representative, "I feel bad for you guys."
Earlene Kilpatrick, executive director of the Bowling Green Chamber of Commerce, reached after the forum, said "I think people are really passionate about the topic. Those who spoke up the most just wanted to get some clarification on how it will impact our local businesses.
"I think the passion comes out in trying to get answers that are realistic. This is going to impact our local businesses."
The chamber, along with U.S. Senator Sherrod Brown's office and the SBA, coordinated Friday's forum. Kilpatrick said additional forums are planned and the chamber will continue with its legislative updates.
Despite the tension, Jim Duffy, with the SBA's Cleveland office, did get through his presentation titled the "Affordable Care Act 101: What the Health Care Law Means for Small Businesses."
Duffy began by presenting some of the challenges small business face with health care.
For starters, he said, small businesses pay, on average, 18 percent more than big businesses for health insurance. Other obstacles include: too few choices for covering employees; higher premiums and unpredictable rate increases; higher rates for groups with women, older workers and those with chronic health concerns; and waiting periods or no coverage for those with pre-existing conditions.
According to Duffy, under the Affordable Care Act, small business owners are better off because there are now limits on how much insurance companies can charge for administrative spending. At least 80 percent of the premium dollars have to be spent on actual medical care. Insurance companies must also disclose and justify proposed rate hikes of 10 percent or more and are subject to state or federal government review.
Beginning in 2014, Duffy said, the Affordable Care Act will prevent insurance companies from: charging higher rates or denying coverage because of a chronic or pre-existing condition; charging higher rates for women; and facing limits on charging higher premiums for older employees. As part of the Act, insurance companies will have to pool risks across small groups to create larger groups.
Some small businesses are also eligible for a health care tax credit. To be eligible for the tax credit, a for-profit business must meet three criteria. They must employ less than 25 full-time equivalent employees; employees' average annual wages are less than $50,000; and the business must pay for at least 50 percent of employees' self-only premium costs. If all three criteria are met, the business is eligible for up to a 35 percent federal tax credit in 2013 and a 50 percent tax credit in 2014, Duffy said,
Beginning Oct. 1, small business will also be able to enroll in the "SHOP" program, which stands for Small Business Health Options Program. The new program is designed to simplify the process of finding health insurance for small businesses. Coverage would begin on Jan. 1.
For more information, visit: www.sba.gov/healthcare.