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Posted: January 20, 2011

Health care reform: a win-win for small business

It's time to separate fact from fiction

John Arensmeyer

Health care reform remains a hot topic, as shown in Tony Gagliardi's Jan. 13 column "Repeal: the New Year's resolution Congress should keep."  In the wake of the vote by the U.S. House of Representatives to repeal the Patient Protection and Affordable Care Act, it's important to separate fact from fiction. They claim it hurts small businesses and the economic recovery, but the evidence suggests otherwise. Sharp rhetoric attacking health care reform may get headlines, but it does nothing to lower the cost of health insurance for America's 28 million small businesses.

Gagliardi's piece blasted the new health care law for increasing costs on small businesses, yet the cost of health insurance has already had disastrous consequences for small business owners across the country, forcing many to cut or forgo coverage, or lay off employees or put off growing their business in order to keep it. A study we released based upon research by MIT economist Jonathan Gruber found that without reform, employers would pay nearly $2.4 trillion in health care costs for their workers over the next decade.

Such dramatic costs would slash 178,000 small business jobs and $51.2 billion in profits in the same period. The study found that reform could reduce this burden by up to one-third. The status quo wasn't sustainable before the ACA was passed and still isn't, which is why health care reform's success is so critical to small businesses' survival.

Despite Gagliardi's assertion that small business owners oppose any attempt to correct the system, according to opinion polling we conducted of small business owners in 20 states across the country, 86 percent of those who don't offer benefits to their workers said they can't afford to, but 85 percent said they feel a responsibility to do so, while more than 80 percent supported two central provisions in the law¬-small business exchanges and the elimination of pre-existing condition restrictions.

The new law, while certainly not perfect, has a number of provisions that will help employers and the self-employed obtain more affordable and comprehensive coverage for themselves and their workers. Last year we released a report with Families USA showing that nearly 84 percent of small firms are eligible for the small business tax credits. These credits will help many small business owners provide insurance to their employees and save money that can then be used to create more jobs.

A survey of 619 small business owners we released on Jan. 4 showed that one-third of respondents who currently don't provide insurance would be more likely to do so because of the tax credits. Our poll found that the same percentage of small business owners not offering benefits said they'd be more likely to do so because of the insurance exchanges.

These competitive marketplaces, which go into effect in 2014, will enable small businesses to access lower-cost health care without sacrificing quality, and will allow them to pool their purchasing power so they can have the same kind of clout large businesses currently enjoy when negotiating for coverage. Their transparent nature will force insurance providers to price plans competitively, and plans will be required to offer a range of benefits that participants in the exchanges can compare, apples-to-apples. This means that small business owners can spend less time reading the fine print to decipher which plan is right for them, and more time hiring quality workers and growing their businesses.

A particular provision of the new law-the 1099 reporting requirement-was also mentioned in Gagliardi's piece. Though the Affordable Care Act has tremendous benefits for small businesses, the 1099 provision, which has nothing to do with health care reform and was included only as a revenue-raising measure, is not one of them. It would require small businesses to file a 1099 form for the purchase of any goods and services over $600, forcing them to spend an inordinate amount of time filling out paperwork instead of doing business. Legislation has been introduced in Congress to eliminate this provision, and we're confident a strong bipartisan vote in favor of this measure will pass that chamber soon.

Those who would deny small business owners the numerous advantages of reform don't have their best interests at heart. The political fighting over health care reform has dragged on for years and must end; it's time to roll up our sleeves and focus on building a health care system that will work better for the country's 28 million small businesses and the tens of millions of families that count on a small business paycheck.
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John Arensmeyer is founder and CEO of Small Business Majority, a national nonprofit organization founded and run by small business owners. Contact John at or 866-597-7431

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Readers Respond

btw, for 40 years I have ALWAYS provided hc for ALL my employees and now the liberals have handicapped that. I have already had to lay off one employee and will have to require more employee participation next year to make up for the 40% INCREASE that I received SPECIFICALLY from this health care bill. Did the liberals REALLY think that they could control the insurance companies. What naivite, but that's the definition of liberal. I'll bet $ that most of the people who agree with the "author" of this bill are government and public workers. By John Wray on 2011 02 19
I knew that I could get you to post your degrees. Your narcissism and elitism is over the top whichs DESTROYS any credibility that you might have had. The people who have bought into this job killing health care debacle are usually of the same bent. I HAVE BEEN A SMALL BUSINESSMAN for 40 years and my hc costs went UP 40% this year BECAUSE OF THIS BILL. What planet are you on that you can't see that. OF COURSE I get angry about the pap that was put out in this article. I appreciate the chance to expose your far left approach. You walked into it like a guppie. I have absolutely NO respect for you, so perhaps your "wonderful" education might show you that there is NOTHING that you can say that effects me in any way. I simply had ONE reason for confronting you; to expose you and I've done that, esp the coward part By John Wray on 2011 02 19
I only have two degrees...a B.A. in Psychology and Philosophy and an M.A. in Religion (Theology and the Philosophy of Religion), both of which were earned. The remainder of the alphabet soup behind my name denotes certifications. I am a Certified Personnel Consultant and am Board Certified in Professional Counseling. These certifications were also earned. I am also a small business owner, and have worked for myself for over 28 years. Not sure how these are "phony degrees." The emotion in some of the posts is really over the top. By John Heckers, MA, CPC, BCPC on 2011 02 19
btw, I have MORE degrees than you do, but I didn't feel obligated or so narcissistic that I had to publish them and YOU should have learned somewhere that you can't just publish a lie. We're NOT talking about opinions here and YOU KNOW IT. Nice try again. This guy is a pure scammer and it's widely known and he NEVER should have been allowed to publish such a lie. I have NO respect for you with all of the personal attack that you've resorted to, but I did respect cobiz but that's fading fast. Now the ONLY reason that I will post here is to expose the lies. Opinions are like butt holes, everyone has one. By John Wray on 2011 02 17
I see that John H. is at it with his far left approach again. What Arensmeyer was ALLOWED to do was a TOTAL scam and a complete lie. Did you bother to research where he was coming from and what his organization was?? Of course you didn't. In any case he has been exposed competely and will have no credibility here or anywhere else that I come across him just like you. Internet cowards and liars MUST be exposed and so far we're doing okay. You're in the minority John with all the phony letters after your name. By John Wray on 2011 02 17
No, folks. Neither should Mr. Arensmeyer been "required" to publish a disclaimer, NOR should CoBizMag refuse to publish him. It is interesting the way that some people want only THEIR side of the argument heard. It is completely immaterial how much or to whom Mr. Arensmeyer has contributed. Does what the Chamber of Commerce has to say become less valuable (or true) because they contributed large sums of money to the Republicans? Agree or disagree, fine. But CoBizMag publishes a wide range of opinions (including some that are diametrically opposed to this article). It seems that whenever a publication publishes something that gives the Progressive side of an issue, Conservatives want to shut down the publication or shut up the writer. Tell does THAT fit in with the supposed goal of "freedom?" Hmmm? A free press with a plethora of opinions (for which CoBiZMag provides a wonderful forum) is the last defense against tyranny. Just because not everyone spouts off your opinion doesn't make them a). evil or b). wrong. And the opinions of those of us who are columnists for CoBizMag are ours alone, and do not necessarily reflect the beliefs or opinions of the publishers or editors of CoBizMag. In fact, I KNOW that some of my articles go against some of the things the publishers and editors believe. This is what true freedom of the press is all about. case you missed this in school. The only time the opinions in a publication reflect the opinions of the publishers or editors is when the publication has a section for opinion from the publishers or editors. This you should have learned in high school. By John Heckers, MA, CPC, BCPC on 2011 02 17
John, have you figured out that I was RIGHT to question this "author". He's a TOTAL scam artist and his "organization" has NO members. He has contributed HUGE amounts to obama etc. This is a complete scam and Cobiz should require him to publish a disclaimer at worst and ban him from further "articles" at best. By John Wray on 2011 02 17
John G. excellent response. I agree that this SHOULDN'T be a political issue, but it certainly has become one. The Dem's, now, CANNOT back down and the REpub's were elected to repeal it. What I'd like to see is an alternative hc bill presented at the same time. If both parties can work on it then obamacare can be repealed. EVERY businessman that I know knew that this bill would drive prices way up. The numbers NEVER added up and robbing medicare didn't help. There are so many other options that could be used. It would take me a book to cover them, but that's from a 40yr businessman who spent a lot of time thinking about this. btw, for our writer, I didn't see an MD behind your name, so what's with the medical advice??? I've got LOTS more letters with d's in them that I could put behind my name, but I'm NOT an elitist By John Wray on 2011 01 31
Typical liberal; you call people names and insult them and think that it's okay. I REALLY don't care what you think of me because I only care about an opinion of someone that I repect and you don't deserve repect. You actually published an article that was full of flat out lies. I will ALWAYS expose such bad bad "journalism.' You don't need to be ashamed about your opinion but you SHOULD be ashamed of such inaccurate and misleading tripe. I'm also glad that others can see what kind of person that you are. The wonders of the internet By John Wray on 2011 01 31
It's easy to blame the insurance companies and the insurance companies are not blameless. We make the connection to the insurance companies because that is who we send the check for our premiums and where we see the increases. However, if the insurance company's profit is in the 5% range and premium increases are 20% to 40% range, what do you think is the source of the real cost explosion? The States and Federal governments have increased mandates on what conditions must be covered by insurance and to what extent. This expands the medical field and the costs. The pot grows bigger and everybody in the medical field is in line to get their cut. The health care debacle isn't Republican or Democrat. We put a high value on health and the system has extorted that value. Unfortunately, the new health care law does not really do anything to reduce costs. If you really want to see costs reduced, eliminate the pot of money and have the financial aspect dealt with strictly between the patient and provider. Of course then, any major medical event would have us wishing there was insurance coverage. By John Gimple on 2011 01 31
John Wray. You need to take your Valium now...if it is covered by your health insurance company. Calm is good. John Arensmeyer was expressing his educated opinion. We now know yours. No need to get abusive. He shouldn't be ashamed for his opinion. CoBizMag publishes many diverse opinions. Chill, dude. By John Heckers, MA, CPC, BCPC on 2011 01 31
btw, John, you didn't separate "fact from fiction" you added to the fiction. Our legislators didn't know what was in obamacare and they admitted it. You KNOW that, yet you try to put "fact" out for something that you OBVIOUSLY didn't do your research on. You COMPETELY bought into the Democrat talking points. It's poor journalism at best and outright fraud at worst. You should be ashamed to publish such an article. By John Wray on 2011 01 31
What was happening before is irrelevant to anyone except a Democrat. Did you MISS my point about SIX insurance companies telling me the SAME thing??? EVERY ONE said that the 40% increase was from obamacare mandates. Didn't you notice that the insurance companies are REQUIRED to carry "kids" until they're 26?? Didn't you notice the rest of the mandates. Now we can discuss whether that's necessary, but we CAN'T argue that they are not being paid for by small business. I'm arguing FACTS and you're arguing theory. Now we ALL know that the figures by our CBO were manipulated because of the data they were given. It isn't there fault, but our "administration' skewed the data and you KNOW it. Why didn't you mention that?? You political "comments" exposed you and I thank you for making your bias clear. Now everyone knows. In FACT, I liked Clinton a lot and I'm quite sure that Obama is competely incompetent regardless of color. It must be nice to have your imagined prejudices to blame your opposition on. Sorry, but FEW true small business people are prejudiced. they simply can't afford to be. It's all about the bottom line and obamacare MUST GO before it destroys this country. for what it's worth, I've got 40 years in business and a bunch of degrees (more than our president) so you're not dealing with a rookie but ESPECIALLY not an elistist like our current administration. Actually, I'm glad to hear your opinion because it assures me that obama will be gone along with the House. You missed the message last election didn't you?? I'm glad and I want you to find other reasons for what happened. By John Wray on 2011 01 31
So, John, let me get this straight. Your health insurance costs HAVEN'T been going up by ridiculous amounts in PREVIOUS years...years when BUSH was in office, or Clinton was in office? Because, if not, you're different from every other small business I know, including mine. What is happening is that the insurance companies, having larceny in their hearts, are raising prices even more than their normal price gouging to profiteer prior to the kicking in of price control regulations. This, yes, is the fault of the law. All provisions of the law should have kicked in almost immediately, rather than in 2014, with a provision preventing this sort of thing. But, get real, you guys. The insurance companies would price gouge no matter WHAT reform law was passed...even if the Republicans got off their payroll and passed one. As with most things, this isn't about "Obamacare." It's about the fact that you guys can't stand Obama, just like you couldn't stand Clinton and some people couldn't stand Bush. Anything that these Presidents do will be villified by those who don't like them. By John Heckers, MA, CPC, BCPC on 2011 01 31
Very good Rick. I suppose Fran won't know what to do with comments from the "non Washington people.' In FACT obamacare has destoyed ONE job in my business and may lose another. If it isn't repealed this country will go the way of Greece. EVERYONE gives lip service to small business but NO ONE actually calculates the ACTUAL effect of legislation on small business. MY HC COSTS WENT UP 40% BECAUSE OF OBAMA CARE. Get it???? duhhhh By John Wray on 2011 01 31
Fran... you sound a bit like one of the "eliteist's" that know better than I because we disagree on an issue. Do you feel compelled to use your superior intellect to take care of the poor "uninformed". By Rick Brewster on 2011 01 31
Almost every year I've had to "research" the field for hc costs. I've always provided it for my employees but this two months ago when I went through the process again, I was told by ALL of the 6 companies that I talked to that obamacare has raised costs. My premiums went up FORTY PERCENT. I had to lay off one worker out of twelve and I may have to lay off another. I DO qualify for the tax credit, but I have to make that much profit for it to matter. The last two years have taken care of any advantage. NO profit means NO credit. Get it??/ In any case the "credit" didn't make up for the increase cost. I was SPECIFICALLY informed by every company that the mandates in obamacare caused the increases as EVERY business person already knew was inevitable. More coverage means MORE money. Get it??? duhhh By John Wray on 2011 01 31
John, I have to agree with Rick. The health care reform bill is not the answer. To say that 84% of small business is eligible for the tax credit is misleading. The tax credit only applies to very low wage employees and the credit decreases as the worker's wage increases. I believe that if the government can entice enough small business to provide coverage because of the tax credit, the next move will be to make coverage mandatory. This doesn't eliminate insurance companies. This doesn't change what medical practitioners charge for their services. It doesn't lower the cost of prescription medications. This law will merely shift costs to employers and tax payers. If inefficiency and fraud are the culprits to increasing health care costs, we didn't need this law address those problems. Heath insurance like pensions started as a way for businesses to attract and retain employees. The liberals in government wants this to change from an optional benefit to a mandated requirement. The cost of health care is out of control and it still be out of control with this new law. Its just a matter of who pays the bill. By John Gimple on 2011 01 21
John -- great article. I believe that many who oppose health care reform are simply deceived by the Republican rhetoric or are part of the right's opposition to anything to do with government whatsoever. The fact is that the system is broken and the law, while far from perfect (not providing a public option, for example) is a good start. While Republicans may get some traction on this issue for a day, people are NOT going to be happy if the popular provisions of this bill get taken away. Republicans, as Bill Frist said, need to work with this bill and the Democrats to make the health care reform better. Thanks for writing this article! By John Heckers, MA, CPC, BCPC on 2011 01 20
John you have swallowed the pill! This monstrosity of a bill may give some short lived opportunity to small businesses by 2014. But at what cost to the quality of care and the right to choose? Do you believe that this bill in entirety improves healthcare quality? Do you honestly believe that the government is better qualified to manage my Healthcare? The CBO was knowingly misled to make the numbers look reasonable to the voters and in fact revised calcualtions as elements of the plan were dropped to allow it to pass the Senate make it devastatingly costly. Here is my hope. That it is repealed and that the process becomes the catalyst for major reform that will not bankrupt this country. A better alternative is to be demanded and done in the light of day and not behind closed doors with lobbyists. Have you read the list of exempted unions? By Rick Brewster on 2011 01 20
Great article! It's about time someone cut through the Republican job-killing, Obama-care rhetoric and told it like it is. We need more frank, unbiased discussions like this to counter the wave of misinformation coming from Washington Lobbyists, proliferating the media and the minds of the "uninformed". Thank you, Fran Scannell (small business owner) By Fran on 2011 01 20

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