Roosevelt Opinion Research recently surveyed 500 small business owners at the behest of the Job Creators Network and found that the cost of health care is a significant concern going into 2018.
When asked: “What is the biggest threat your business faces in 2018?” 16.2% replied “health care mandates.” While that ranks far below “finding qualified workers” (27.3%) and “other” (22.1%), 16.2% (approximately one-sixth) is a significant number.
Under the Affordable Care Act (ACA), businesses with 50 or more full-time equivalent (FTE) employees must offer affordable health insurance for those employees and their dependents, or face a fine.
When asked: “Is the cost of health care a concern to you in 2018?” 55.9% said that they are “very concerned,” and 20.6% said they are “somewhat concerned.” A combined 20.2% said they are either “somewhat unconcerned” or “very unconcerned.”
When asked: “Does the cost of health care prevent you from offering health insurance to your employees?” 62.9% said “yes,” while 29.1% said “no.”
Lastly, when asked: “If you had access to an association health plan that was a substantially cheaper than current offerings, would you consider offering health care coverage to your employees?” 75.2% said “yes,” while just 13.5% said “no.
For the 62.9% of small business owners who are concerned about the cost of healthcare, and the 75.2% who might offer health insurance to employees if it were cheaper, there may be a partial solution in the works.
In early January, the Trump administration’s Department of Labor announced a proposal that would let a larger number of small businesses and sole proprietors than is currently allowed to band together and form associations. These groups could then use their collective power to negotiate lower health insurance costs.
A January 4 press release states in part:
Many small employers struggle to offer insurance because it is currently too expensive and cumbersome. These employees – and their families – would have an additional alternative through Small Business Health Plans (Association Health Plans). These plans would close the gap of uninsured without eliminating options available in the healthcare marketplace. Under the proposal, small businesses and sole proprietors would have more freedom to band together to provide affordable, quality health insurance for employees.
The proposed rule, which applies only to employer-sponsored health insurance, would allow employers to join together as a single group to purchase insurance in the large group market. These improvements stand to open health insurance coverage for millions of Americans and their families by making it more affordable for thousands of small businesses and sole proprietors. By joining together, employers may reduce administrative costs through economies of scale, strengthen their bargaining position to obtain more favorable deals, enhance their ability to self-insure, and offer a wider array of insurance options.
As long as the health insurance debate continues in Washington, concern will likely remain high. At least for some, however, the Association Health Plans (AHP) proposal may provide hope that the gears are turning, and some relief is coming.