After years of concern related to the Affordable Care Act and the additional burdens it placed on organizations, there’s a new issue to contend with. President Donald Trump made promises in the past to roll back the ACA – commonly called Obamacare – and a potential replacement bill was released in early March.
What does this mean for small business owners? There are plenty of potential considerations, depending on exactly what happens to the ACA. Let’s take a look at some of the biggest issues on the table.
The possibility of cost savings
If the ACA is repealed or changed in a way that removes the need for employers of 50 or more full-time staff to provide coverage to 95 percent of those workers, businesses will experience some large changes right off the bat. The first is the now-voluntary nature of health care, removing a significant expense from the ledger of many business owners. Depending on your balance sheet and the number of employees you have, this could lead to significant savings.
Potential issues for workers
Another important element, whether or not your company reaches that threshold of 50 full-time employees, is the potential lack of health care for you and your staff. In practice, the ACA caused the rate of Americans lacking health insurance to drop to its lowest recorded number since that statistic was first recorded.
CNBC, drawing on data from the Centers for Disease Control and Prevention, reported the uninsured rate hit an all-time low of 8.6 percent in the first quarter of 2016. In 2010, the year before the ACA required all U.S. citizens to either have health care or pay a fine, about 16 percent of Americans were uninsured.
What does this mean for your business? If you employ people who are only covered due to the law changes caused by the ACA, some of them may decide they no longer want or need health insurance. This difficult decision could ultimately influence your operations through employees getting sick and lacking the resources to quickly address that issue.
You may also see some employees seeking out jobs that offer health insurance, which means more costs for finding and training their replacements. Because significant Medicaid expansion is another component of the ACA, as noted by the Associated Press, businesses in those states could see additional impacts if they employ people who are now covered but won’t be following a repeal or change.
For some businesses, those changes will be minor if they’re noticeable at all. Others, however, may experience more call outs and sick days, a drain of knowledgeable, successful employees who seek out other opportunities, or both.
An uncertain path forward
Payroll company Paychex’s analysis of the potential removal of all or part of the ACA is one of uncertainty. The company believes it’s simply too early to tell exactly what will happen. Some major developments following any action – like the destabilization or collapse of the individual insurance market – won’t make themselves known until after the changes are made. Depending on whether it’s a full or partial repeal and which elements are retained in a new health care plan, there are a very large number of potential outcomes.
In a time of such uncertainty, it’s important that business owners take stock of their assets, resources, liabilities and opportunities. With that knowledge in hand, they can take on potential difficulties more confidently. Consider taking some time soon to familiarize yourself with the benefits of loans and credit from alternative business financing companies and be even more prepared in the future.
Sources:
https://www.cnbc.com/2016/09/07/obamacare-pushes-nations-health-uninsured-rate-to-record-low.html
https://www.paychex.com/articles/health-reform/repealing-aca-business-implications
