News surrounding the Affordable Care Act have been a topic of discussion for business owners nationwide, as additional expenses can greatly affect small business owners’ ability to budget in higher costs, especially when just starting out.
Many residents of New Orleans are attempting to repeal a section of the act that would place an additional tax on insurance companies, according to a new report from The IC Times-Picayune. Should business owners need to pay more for healthcare plans for themselves and their employees, they could look for alternative ways to cut corners on expenses, such as letting go of employees or decreasing coverage outlined in their commercial insurance policy.
Data revealed that the additional tax could raise around $87 billion between 2014 and 2019, while the National Federation of Independent Businesses suggested family’s could see the cost of coverage increase by around $500 each year. Large companies who see a large amount of profit won’t likely be as harshly affected by this as small businesses, which has created a bit of a divide in some industries.
In preparation for the new healthcare law which goes into affect next year, states nationwide have been developing alternative programs for business owners and families alike. According to the Times-Picayune, some small business owners in Louisiana are mostly concerned about raised premiums that will force cuts in other departments. One New Orleans business owner, Dickie Brennan told the source he fears having to eliminate programs and benefits.
“It affects individuals we are trying to help,” Brennan said in part of his letter addressed to Senator Mary Landrieu in an effort to win a vote to repeal the tax.
Many small businesses offer incentives and programs for their employees such as helping them return to school to continue their education or buying their first home. Larger businesses don’t always have these programs, which is one benefit owners have over larger corporations when hiring.
Even small companies that have seen growth since the start of the economic recovery are worried about how their finances and ability to provide employees with other benefits will be influence with higher taxes for insurance. Companies who plan on switching care are urged to compare not only the premiums being offered by the terms and conditions. Understanding how these plans will change with the start of the Affordable Care Act is also crucial when looking at its affects long-term.