Opinion: Healthcare reform one year later: Moving small business forward
John Arensmeyer
Luck, however, had nothing to do with it. Mark’s a savvy business owner, and more important, an informed one. After healthcare reform was passed a year ago, he educated himself about the law and jumped on one of the first small business-focused provisions to go into effect: healthcare tax credits. Those credits, which will plant $15,000 back in his coffers, gave Mark, who was on the fence about hiring a new employee, the confidence to do so.
As we mark the first anniversary of the passage of the Affordable Care Act, it’s important to remember who it was enacted to help: folks like Mark Hodesh, his new worker, who was unemployed before joining Mark’s crew, and the 28 million other small business owners who needed relief from a broken system that discouraged entrepreneurship and stunted economic growth. And on a more personal level, it was passed to help those employers who wanted to do right by their employees and offer benefits but couldn’t because of outrageous costs and scurrilous insurance practices.
An economic analysis released by Small Business Majority and based on modeling by MIT economist Jonathan Gruber concluded that without reform, small employers would shell out $2.4 trillion to cover healthcare costs by 2018, and 178,000 small business jobs and $52.1 billion in profits would be lost. In the world beyond ledgers and red ink, real people would have been hurt. Mark Hodesh’s new employee, for one, would likely be back in the unemployment line. No matter where on the political spectrum you fall, that’s a grim picture.
Despite rhetoric claiming otherwise, the ACA is stocked with provisions aimed at reducing small businesses’ healthcare costs and ensuring they have access to quality, affordable insurance. For instance, four million small businesses are eligible now for the same tax credit Mark Hodesh will receive. Unfortunately, this benefit, along with many others, gets lost in the political theater surrounding the act. That’s a shame because, as we found in a national survey of small business owners released in January, 57 percent don’t know the credits exist. But once they learn about them, one-third who don’t offer insurance said they would be more likely to do so.
For many small businesses, tax credits aren’t just an appealing idea floated in a survey; they’re much-needed dollars flowing back into their cash registers this year. Dollars that enable entrepreneurs like Mike Hodesh to hire new employees; dollars that let people like bookshop owner Betsy Burton of Salt Lake City -- who just last year faced the demoralizing decision to either drop her business’s health plan or lay off workers to contain costs -- to continue offering coverage.
These are the success stories we hoped to see when the president signed the bill into law. But tax credits are not the end of the story. By 2014, states will create health insurance marketplaces where small businesses can pool their buying power and drive down costs. And insurance companies will no longer be able to refuse coverage because of preexisting conditions—a reality that stifles entrepreneurship because many creative and hardworking people are scared to start a business without coverage.
Opponents of reform want to reignite the debate we’ve had for two years over the ACA, but we don’t see the point. The act is working for small business. It’s time to move forward. It’s time to let Mark Hodesh and Betsy Burton focus on the health of their business rather than worry about a sickly bottom line. It’s time to let states begin creating insurance marketplaces that will lower the cost of healthcare. And it’s time to let the spirit of American entrepreneurship flourish and drive our economy to new heights.
John Arensmeyer is the founder and CEO of Small Business Majority (www.smallbusinessmajority.org), a small business advocacy group based in Washington, D.C.
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