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NFIB Healthcare

NFIB Healthcare

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Published by workitrichmond

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Published by: workitrichmond on Aug 04, 2011
Copyright:Attribution Non-commercial

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08/04/2011

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 July 2011
S
mall
B
uSineSS
 
 and
 H
ealtH
i
nSurance
:
O
ne
ear 
fter 
 e
nactment
 
Of
PPaca 
S
mall
B
uSineSS
 
 and
 H
ealtH
i
nSurance
:
O
ne
ear 
fter 
 e
nactment
 
Of
PPaca 
 
The
NFIB Research Foundation
is a small business-orientedresearch and information organization afliated with the
National Federation of Independent Business
, thenation’s largest small and independent business advocacy organi-zation. Located in Washington, DC, the Foundation’s primarypurpose is to explore the policy-related problems small businessowners encounter. Its periodic reports include
Small BusinessEconomic Trends
,
Small Business Problems and Priorities
, and now the
National Small Business Poll 
. The Foundation also publishes ad hocreports on issues of concern to small business owners.
1201 “F” Street, NW Suite 200 Washington, DC 20004nfb.com
 
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• One year ater passage o the Patient Protection and Aordable Care Act (PPACA), 42 percent o small employers –defned as businesses employing 50 or ewer people other than the owner(s) – oer employee health insurance. In thelast 12 months, 1 percent o oering small employers added health insurance as an employee beneft while 4 percento non-oering employers dropped it.The number o small employers oering employee health insurance is likely to change little over the next 12 months. Virtually no small employer now oering expects to drop health insurance in the next year and virtually no non-oering employer expects to add it in that time rame.• Twenty (20) percent o small employers currently oering expect to signifcantly change their beneft package and/or their employees’ premium cost-share the next time they renew their health insurance plans. Almost all signifcantchanges expected involve a decrease in benefts, an increase in employee cost-share, or both.Since enactment, one in eight (12%) small employers have either had their health insurance plans terminated or beentold that their plan would not be available in the uture. Plan elimination is the frst major consequence o PPACA that small-business owners likely eel.• Eighteen (18) percent o small employers think they are “very amiliar” with PPACA and another 40 percent thinkthey are “somewhat amiliar” with the new law.• By overwhelming margins, small employers who have some knowledge o the new law think that PPACA will
not
 reduce the rate o health care (insurance) cost increases, will
not
reduce the administrative burden, will increasetaxes, and will add to the ederal defcit. They agree that PPACA will result in more people having health insurancecoverage, but do not think it will yield a healthier American public.• The principal actor explaining the PPACA outcomes that small-business owners expect is their current oer/non-oer status. Those oering employee health insurance are notably more pessimistic about the new law’s projectedoutcomes. Neither the degree o amiliarity with PPACA nor employee size-o-business is associated with theirexpected outcomes.Low-wage employees, particularly those experiencing a large premium cost-share, have a powerul incentive to bolt anemployer’s health plan or the newly established and heavily subsidized exchanges. Should employees begin to leaveor an exchange, 26 percent o currently oering small employers are very likely to explore dropping their healthinsurance plans and another 31 percent are somewhat likely to do so.A key actor in a small employer’s decision to drop a current health insurance plan will be the proportion o employeeswho leave their health plan or an exchange. Forty-three (43) percent report that a majority o employees would haveto leave beore they would drop their plan and 35 claim it would require all o them.• An estimated 245,000 (out o 5,228,000 employers with ewer than 25 employees) are eligible or a ull PPACA taxcredit. Another estimated 1.165 million are eligible or the partial credit.• The PPACA tax credit acts almost exclusively as a windall or small employers who currently oer health insur-ance rather than as an incentive to encourage its purchase. Considering eligibility and awareness issues, the ull creditincents, but does not necessarily change behavior, o only about 2 percent o small employers having ewer than 25employees.Fity-seven (57) percent o small employers express interest in contributing to defned contribution-type health plans.Their interest assumes employees benefting rom their contributions receive equitable tax treatment compared tothat in employer-sponsored plans.
e
 xecutive
S
ummarY 

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