So much of the news about federal health care reform’s impact on small business focuses on the bleak—from employers cutting hours to the scaling back of health coverage for dependents. The Obama administration is trying to change that. In a blog post on Wednesday, WhiteHouse.gov outlined five reasons that small-business owners should embrace, not fear, Obamacare:
1. A more-level playing field.
Small businesses currently pay 18 percent more on average for health insurance than large businesses, the White House says. The new Small Business Health Options Program (SHOP) will give small-business owners the same group purchasing clout as big business.
2. Greater pricing transparency.
The public exchanges, particularly the SHOP exchanges, will make insurance pricing and options far more transparent. Rather than having to wonder whether your business is getting a fair deal on insurance, the SHOP exchanges will make it far easier to compare prices.
3. Better tax breaks.
Small-business owners who currently buy health insurance can get a tax credit for up to 35 percent the cost; that is set to rise to 50 percent for qualified small businesses that buy insurance through the SHOP exchanges starting in 2014.
4. Improved risk pooling.
Many small businesses have trouble getting affordable insurance because their small employee base is seen as too risky by insurers. One employee with a serious medical condition can make rates soar. Obamacare should make that less of a concern, as the SHOP exchange will spread risk across many employers.
5. Better wellness rewards.
Small employers will have access to higher premium reductions for employers that get their workers involved in wellness programs. Currently, they can get up to a 20-percent reduction; starting next year, those rewards will rise to 30 percent. They can even reach 50 percent for companies with workers who commit to stop smoking.
This isn’t the only positive news to emerge in recent days, however. Some states, including New York and Maryland, predict that their small business premiums could drop substantially next year, thanks to Obamacare. (Read a recent piece I wrote on 7 things you should know about health care reform, which lays out some pros and cons.)
The Obama administration along with the group Small Business Majority also recently unveiled a new tool, the Health Care Changes Wizard, on Business.USA.gov to act as a one-stop resource for business owners on Obamacare.
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