Don’t let them fool ya,
Or even try to school ya! Oh, no!
We’ve got a mind of our own,
So go to hell if what you’re thinking is not right!
— Bob Marley
Since President Obama was elected the 44th President of the United States nearly five years ago, there has never been a dull moment in either the Congress or House of Representatives. It seems practically every decision made by the Obama administration is met with Republicans’ opposition of one kind or another.
The Patient Protection and Affordable Care Act, informally referred to as Obamacare, is just one of the many pieces of legislation that has been introduced but strongly opposed by members of the Republican Party. Today, even though the bill is now a United States statute signed into law, the Republicans continue to seek ways to thwart its implementation.
Some small business owners and their management team who also sing from the same song book as the Republicans have also joined in the chorus of — Obamacare will kill small business.
Consequently, without seeking to understand the bill or waiting for the kinks in its implementation to be ironed out, they have seized upon the confusion surrounding parts of the bill and used it as a grand opportunity or an excuse to either cut their staff, drop health insurance coverage as part of the benefit to staff, or drastically reduce their health insurance plan.
The plain truth about the affordable care act is that the new law’s rules have nothing to do with a vast majority of small businesses. The employer mandate, which forces firms to start providing insurance in 2014, only applies to companies with at least 50 full-time workers.
Now that’s only a small fraction of small businesses in the United States. The fact is as of 2010, there were approximately 5.7 million small business employers, that is businesses with fewer than 500 workers. Of this total, 97% of them have fewer than 50 full-time employees. What this means, therefore, only 3% of small businesses would be affected by the Obamacare’s mandate.
It therefore means that only an unenlightened and foolish administration would seek to punish a sector such as the small business sector that:
- represents 99.7 % of all employers
- accounts for a large percentage of jobs in start-ups
- represents a key source of innovation and economic growth
- represent 96% of all U.S. exporters of goods
Moreover, to implement any policy that would hinder small business from growth and development would be tantamount to “killing the goose that lays the golden egg.”
It defies logic and furthermore, it would be rather irrational for the Obama administration not to consider the serious implications and impact of its health care policy on small businesses.
The fact of the matter is the brouhaha by the Republican Party is clearly and simply an anti-Obama politics. It has nothing to do with the merit of the Obamacare plan in so far as its impact on small businesses is concerned.
In a research conducted by the Council of Economic Advisers (CEA), titled, “The Economic Effects of Health Care Reform on Small Business and their Employees,” it was shown that prior to the reform by the Obama administration:
- The system imposes a heavy “tax” on small businesses and their employees, primarily due to high broker fees, fixed administrative costs, and adverse selection.
- Small business pay up to 18 percent more per worker than large firms for the same health insurance policy.
- Higher healthcare costs prevent small businesses from providing health insurance for their workers compared to large businesses.
- Only 49 percent of firms with 3 to 9 workers and 78 percent of firms with 10 to 24 workers offered any type of health insurance to their employees in 2008. In contrast, 99 percent of firms with more than 200 workers offered health insurance.
- Workers in small firms that offer health insurance tend to have less generous plans than their counterparts at large firms.
- The fraction of small firms offering health insurance has declined dramatically over the last few years.
Given the foregoing, it befuddles one’s mind to think of any rational reason for not supporting a health care policy reform that will impact positively on the small business sector.