The Supreme Court Monday began the process of deciding whether President Barack Obama's healthcare reform bill is constitutional.
Three days of hearings on the Patient Protection and Affordable Care Act began Monday as the Justices determine whether to hear the case now or wait until 2015 when the regulations take effect. (Listen to audio of the arguments.)
One central topic: whether or not the individual mandate penalty fee, which would charge a fee to those who do not have healthcare coverage, actually is a tax. This brought up discussion of the Anti-Injunction Act, an 1867 law that says lawsuits that would "seem to interrupt the collection of federal tax revenues" cannot be ruled upon.
Karen Harned, executive director of the Small Business Legal Center at the conservative National Federation of Independent Business, said the group was glad to see the justices questioning the Anti-Injunction Act.
“It was a great day for small businesses. Bottom line is that there was healthy skepticism on the part of most, if not all, of the justices on whether or not the Anti-Injunction Act warrants challenge at this time,” Harned said in a statement. “We feel good about our chances of the court going to the merits of whether or not the individual mandate is constitutional. We’re looking forward to arguments tomorrow.”
The NFIB is arguing alongside 26 states that the provision mandating everyone obtain health insurance—whether through an employer or a state-based pool—is unconstitutional, and thus the entire law must be struck from the books.
But some small businesses say healthcare reform already has helped their balance sheets.
Mike Roach, the owner of Paloma Clothing in Portland, Ore., says the Affordable Care Act’s small-business tax credit has trimmed $5,500 from his company’s healthcare premiums. It's also allowed him to keep his workers on a good-quality plan even as costs rise.
“The new healthcare law has already started helping us,” Roach told The Washington Post. “Overturning it would send us back to the dark ages.”
Number of employees is, of course, a huge factor in determining how much the new rules will cost you.
Starting in 2010, small businesses with fewer than 25 employees who each make less than $50,000 on average could claim a tax credit of up to 35 percent of premium expenses, calculated on a sliding scale based on the number of employees.
Companies with between 25 and 50 full-time employees don’t qualify for a tax credit, but they also are not required to provide health insurance under the law. According to the U.S. Small Business Administration, 96 percent of all American companies have fewer than 50 employees—and a recent Kauffman Foundation survey revealed that only half of companies that survive to six years old have any employees at all.
Companies with more than 50 workers, the other four percent, will be required to provide health insurance or face fines of up to $2,000 per employee.
Though a decision is not expected until June, The Supreme Court blog noted that the comments and questions of the Justices during the 89-minute hearings "left the distinct impression that they are prepared to rule on the constitutionality of the mandate that individuals must buy health insurance, and not push the issue off into the future. The exact route they would take was a bit uncertain, but their skepticism about taking a pass now was clear."
Has healthcare reform already affected your business, and if so, how?
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