ObamaCare Hits Small Business Hard in Gloomy ’15
Red Tape: With businesses’ one-year reprieve from financial penalties under ObamaCare ending, the horror stories of complying with the costly health care law already are trickling in. The worst is yet to come.
But many of these small businesses are retailers that don’t have the kind of margins where they can cover workers and still stay in business.
Many grocers and restaurants have opted to pay the fine rather than swallow the larger cost of buying coverage for all workers. Others are cutting back worker hours to duck the law altogether.
Universal health care is hardly “free,” and its costs hit both employees and customers hard. Service companies — including even garbage collectors — are passing on the added cost to customers in the form of higher bills.
Take God Bless the USA, a trash collection company outside Charlotte, N.C. It recently notified customers that it’s raising prices 5% to help cover expenses.
“Due to the Affordable Care Act, effective Jan. 1, 2015, we are obligated to provide health care coverage to all of our employees,” it explained in a Dec. 5 letter. “Unfortunately, we are unable to internalize this cost and are sorry we have to pass this cost on to you.”
Requirements under ObamaCare (again) tighten in 2016, when smaller firms employing 50 to 99 full-time workers also have to offer coverage or face fines.
A few small businesses in Michigan that did offer employee-sponsored health coverage are now preparing to stop next year, says Michigan Group Benefits, an East Lansing-based insurance agency.
Why? Sticker shock from the pricier ACA-compliant policies, which provide everything from “free” mammograms to colonoscopies.
Blue Cross Blue Shield and other insurers have stopped allowing businesses to renew policies that aren’t compliant with ObamaCare. In their place, they’re offering plans with 14% to 45% rate increases, the National Association of Health Underwriters says.
Though employers with fewer than 50 workers are exempt from mandates, they too are feeling ObamaCare’s pain.
Kaiser Permanente already has sent cancellation letters to such employers, explaining that their existing plans don’t offer ObamaCare’s richer benefits and therefore are no longer available.
Some two-thirds of the 31 million employees who work for such firms and get health insurance from them could receive similar cancellation notices over the next year.
When President Obama signed ‘ObamaCare’ in 2010, he promised it would “lower costs for families and for businesses.” As it turns out, neither is true.
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