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Posted: October 01, 2010

How health-care reform helps small business

By Suzanne Bragg-Gamble and Jim Swayze

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Federal health-care reform law will take a few years to fully implement. But if you work for yourself or run a small business, you may already be feeling the new law's impact. Here's a look at the most important benefits of the 2,400-page bill:

If you're uninsured
For self-employed and unemployed people without health insurance, a new federally funded program offers a long-awaited means of coverage.
In July, the federal government set up a new insurance plan for uninsured people with medical conditions, called GettingUSCovered (www.getting-uscovered.org). Administered by Rocky Mountain Health Plans and CoverColorado, the program solves a frustrating problem for people who are or have been sick: It's almost impossible for them to buy health insurance.
While GettingUSCovered is not a low-income program, it makes health insurance available to people who have been denied coverage. Thanks to $90 million in federal subsidies, members pay the same rates as that of a healthy person of the same age and smoking status. The program is ideal for working people - such as self-employed consultants, marketers or Realtors - who live with manageable, chronic medical conditions and no longer want to risk their financial security by going without health insurance.

If you're a female business owner
For the past 20 years, women consistently have been launching new enterprises at twice the rate of men.
But when it comes to buying health insurance, female "solopreneurs" have been penalized. For instance, in Colorado, self-employed women starting a family couldn't buy comprehensive health insurance - maternity care was not offered. And some health plans rescinded coverage to women who signed up and later got pregnant or sick.
As of September, it was illegal for insurance companies to drop women if they got sick or decided to have a baby, except in cases of fraud. Starting next year, Colorado health plans in the individual market will be required to offer maternity coverage.

If you operate a small company
The smallest companies struggle the most to provide health insurance for their employees because their rates are much higher than those of large employers.
To ease the burden, the new law includes tax credits, effective now, to help an estimated 68,000 eligible Colorado small businesses and nonprofits afford and maintain health insurance.
Businesses that pay more than half of the cost of their employees' health benefits and have fewer than 24 employees, and pay average annual wages of less than $50,000 are eligible. The credit most helps firms with 10 or fewer employees and those with average wages below $25,000.
These businesses can claim a tax credit of up to 35 percent of the cost of premiums from the 2010 tax year through the 2013 tax year. The credit will go up to 50 percent in 2014 and can be used for two consecutive years after that.

If you're ready for competition and simplicity
GettingUsCovered and small-business tax credits offer some immediate relief to the business community and self-employed. A more widespread benefit of health care reform will come in 2014: health insurance exchanges.
Exchanges will allow small businesses and individuals to pool their purchasing power - in effect, to act as a large group - to buy health insurance. Pooled purchasing promises to lower the cost.
It also creates an online marketplace - think Travelocity or Expedia - that adds transparency, comparability and competition to the process of buying insurance.
In addition, in 2024, employers can decide whether to continue offering group coverage or let employees buy their own health insurance, perhaps with a pay raise to help.
As health reform begins to take shape, self-employed workers can seek help through GettingUSCovered, and small-business owners will see tangible benefits such as tax credits that go a long way toward reducing the financial burden of insuring themselves, their families and their employees.
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Readers Respond

The "associations" cannot cross state lines. That was one of the most important requirements of a health care law, imho, and the Dem's WOULD NOT consider it. They made a deal with the insurance companies. Of course later, they threw the insurance companies under the bus so now they're contributing big time to defeat Dem's. I belong to a national association that would probably get me much cheaper rates, (NFIB &/OR AWSA) but they can't do it. One of the major problems is the mandates. All states are different as to what they HAVE to cover. It all makes it difficult and only possible to do at the Federal level. Logic is NOT one of the factors in this process. By John Wray on 2010 10 15
I have worked for small companies that joined associations in order to get a group insurance rate. Is this no longer feasable? I was with a company that joined the Associated General Contractors, and the AGC had tens of thousands of members. That was a better insureanc deal than pooling a few companies. Sounds like it wasn't broke in the first place. Another thing I dont' get is that many companies, as they find out about the law, are taking what I would term are drastic actions. $1 billion writoff of profits by AT&T, McDonald's dropping 30,000 mini med employees. Doesn't look promising from this point. By Mark Kuta on 2010 10 15
excellent response. That's what we're all afraid of as long as the current administration is in control By John Wray on 2010 10 14
Of the items mentioned, only the pooling of companies or organizations to create more buying power is likely to help reduce costs in the short run. The tax credits are too small to entice employers to cover employees considering that this will morph into a mandated obligation once the government has enough people on board. Government subsides don't change the cost of coverage, only who pays for the coverage. And once again, it will hit those who are middle class and above in the form of increase taxes. The only way government would potentially be able to slow or reduce the cost of health care would be a total government takeover where they run hospitals, drug makers, equipment manufacturers and practitioners. Then you have to ask yourself, would that give you quality health care? By John Gimple on 2010 10 14
I’ve been in business for FORTY years and I KNOW the facts. Sorry that you don’t because you OBVIOUSLY haven’t listened to the ONLY people who DO understand the health care fiasco. My insurance went up FORTY percent this year and it’s SPECIFICALLY because of Obama care. The insurance companies have to make the money back that Obama care forces them to spend for un-insured people. I see that you think that you also know more than three long term insurance professionals. I suppose that being a liberal Democrat has nothing to do with that supposition. You REALLY need to talk to real people, not ideologues. Just so you know I have a doctorate and a bachelors degree in Nuclear Physics. I don’t need someone who is not really connected with the real world telling me what’s “interesting.” I’m sorry that you got the 30 hour requirement wrong and that’s “interesting.” All three of my PROFESSIONAL insurance people, (one of which is from the NFIB) disagree with you. Hmmmm interesting> I’ve already notified my part-timer that he has to drop to TWENTY hours. You’re using the Colorado STATE rules which are different than Obama care. I also laid off a new employee because under my old company rules, they had to be employed here for a year before they got health care paid by me. I’ll take a guess that I speak for MOST small businessman in saying that I DON’T NEED Obama telling me how to take care of my employees. I’ve paid ALL of their health care costs for decades. THEY don’t want Obama care because they KNOW what it will cause. Private insurance companies will be priced out of the market giving health care to those who won’t work. You don’t deserve to have the public forum that you have with your extreme liberal viewpoint. Thank God, the majority of this country agree with me and in three weeks it will all change. Obama care WILL be repealed. If we follow the obama care, single payer is INEVITABLE and my employees knew it before I did. Few people want the Canadian of English system. In the mean time, I think you are misleading your audience to a level that I’ve rarely seen. I READ the bill before it was passed and my wife who is an ex bank president read it with me. We agreed that it would be a disaster and it IS. Have you figured out why the REAL job creators in this country AREN’T creating jobs??? I knew small businessmen wouldn’t expand two years ago. We do NOT trust the liberals like you who have been in control and won’t hire until we get a pro business administration and there’s nothing that Obama or his minions can do about that. It’s NOT money, It’s NOT credit; it’s NOT “help” from the incompetent government; IT’S BECAUSE of the government and liberals like you. Obama is the worst president in history and history will clearly record that. Good luck with your campaigning, but I’d suggest that you not try it in the country outside of Denver. Fyi, my business is 83 years old and will last another 83. Thanks for making it so clear about your politics. Reporters quit being reporters when the reader can tell their political persuasion after reading their “news”. Yours couldn’t be any clearer. John Wray pres Marsau’s By John Wray on 2010 10 14
So, John, in your first post you are totally confused, and in your second you know the "REAL facts". Very interesting. 1. If you have three advisors and none of them can explain things, dump them all and find someone who knows. 2. Health insurance for small business has gone up 10-20% per year for over a decade. How is this related to health reform? Its actually the result of there being no health reform until now. At least you'll get something back in the tax credit. 3. In the reform rules, you can avoid the obligation for anyone working less than 30 hours a week, so all you have to do is reduce this person to 29 hours and give them a 3% raise,and figure out how to make him/her more productive. You don't have to lay them off, unless you just want to enjoy getting all hysterical to promote your political leanings. By Eric Cove on 2010 10 14
also, my decisions about health care are now MUCH MUCH more complicated. I've got three professional health care providers and none of them agree and none of them can explain what's happening adequately. It's TOTALLY confusing. By John Wray on 2010 10 14
The comments about "small business operators" leaves out the FACT that this years health insurance costs took a HUGE jump. My increased costs are more than the 35% tax break. When the tax breaks run out I'm doomed. Also I have to insure employees that I didn't have to before. I have a "part timer" that only works 30 hrs/wk and now I have to insure him. I CANNOT afford it so I have to let him go. These are the REAL facts about this bill. It gets worse By John Wray on 2010 10 14

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