One of the big complaints that plenty of entrepreneurs across the country probably have about the health insurance mandate built into the Patient Protection and Affordable Care Act is not an objection to providing health insurance itself – millions of companies already did so before the requirement was in place – but the amount of work they’d have to do to show they’re compliant. Now, data suggests that the average small business could lose thousands of dollars annually just as a result of having to do this work.
Data from the National Small Business Association shows that, on average, companies that can be considered small spend more than $15,000 per year on compliance and paperwork when it comes to the health care law, according to a report from the Associated Press. This is often because it’s a complicated and time-consuming process to go through each employee’s eligibility one-by-one and filling out all the necessary documentation.
What’s being done?
Larger companies often have sizable legal departments to help them deal with those requirements, but that’s not going to be the case for the vast majority of companies with fewer than 50 employees, the report said. That means they have to either pay other companies or consultants to do the work for them, or do it themselves and lose lots of man hours (and also risk getting it at least a little bit wrong).
“They want to comply with the law and don’t want to be subject to an unintended penalty,” Dorothy Miraglia King, executive vice president of the St. Petersburg, Florida-based human resources provider Engage PEO, told the news agency.
All companies will have to provide workers who average more than 30 hours per week over the course of the year – plus their dependents – health insurance, if the company has more than 50 employees, the report said. But even those that do not will have to provide documentation of worker insurance so that those employees don’t face fines for going without coverage on their end.
Owners who want to ensure that they have the best possible standing to handle the time and cost associated with compliance might want to consider the benefits of cutting expenses for other things. That could include finding more affordable small business insurance policies – including those for commercial insurance – to potentially save thousands annually.