Obamacare And Small Businesses
The start of a new year means many things, and, for small businesses this year, it means the implementation of the Affordable Care Act (ACA).
Under the ACA, small businesses with more than 50 employees have (as of 2015) an “employer mandate” to provide health insurance for those employees; if they fail to do so, they face a $2,000 fee per each uninsured worker. Businesses with 25 or fewer employees are not part of the mandate, but are eligible for tax credits to subsidize employee healthcare.
So what does that mean for Westchester small businesses? “There’s been a lot of trepidation with the law,” says John Ravitz, executive vice president of The Business Council of Westchester. “The biggest concerns were that the initial rollout was such a disaster on a federal level, and then there was the cost issue of whether or not it was feasible for companies to pay for health plans,” he adds.
To get a better sense of how the ACA is affecting the county, we spoke to a few Westchester business leaders to gauge their feelings about the impact of the ACA in a small business setting.
Tompkins Landscaping Corporation, Shrub Oak
On finding a plan for employees:
“To find a small group plan that was affordable was a challenge. The entire experience was frustrating because I had such a hard time understanding all of the vague employer-participation requirements. It took two months to find a healthcare plan, and it was still not as affordable as desired. Only one out of my seven full-time employees took the plan; they were either already under the plan of a parent or significant other, or they couldn’t afford our plan.”
Rey Insurance, Sleepy Hollow
On offering health insurance to clients:
“The healthcare rules began changing so rapidly that it changed the whole game. Healthcare companies were still providing plans, but I didn’t want to go through the education process of learning about which groups were suitable for different plans under the new law. The law was confusing, and I was no longer confident in my ability to provide clients with top-quality service, so it basically shut down a small fraction of my business.”
Grand Prix New York, Mount Kisco
On the “wait and see” approach:
“Whereas larger businesses have the organization and expertise to understand these complexities, smaller and medium-sized businesses are most likely still struggling to understand the law in its entirety. Certainly with the Senate switching to Republican control in 2015, many businesses will wait to see which aspects of the law are revised, which will further complicate planning.”
Bleakley, Platt & Schmidt, LLP, White Plains
On the uncertain legal impact:
“The Affordable Care Act is problematic because of its uncertainty; there are so many questions that employers have to answer: Is the act going to stay in place? How will it affect the cost of insurance? Are employees happy with the plan? Does the plan satisfy a business’s requirements under the law? It’s a totally unknown variable that small businesses have to take into account, and that’s causing us to pause when working with clients.”