Last night, Congress led by House Speaker Nancy Pelosi, succeeded in finally passing legislation that will empower 31 million people with a new right to health insurance and remake the nation’s health care system. Many of those people without healthcare are small business owners, who have been struggling to keep their businesses afloat. Just after the vote passed, President Obama said, “This legislation will not fix everything that ails our health care system, but it moves us decisively in the right direction. This is what change looks like.”
So what does this really mean for you and your business? Once signed into law by President Obama, working professionals will no longer need to keep their job to have health insurance. No longer will those without financial means and pre-existing medical conditions be subject to the greed of health insurance companies.
- Small businesses with fewer than 25 employees and average annual wages of less than $50,000 will be eligible for tax credits to cover up to 35% of their insurance premiums.
- Companies with more than 50 workers that don’t offer health-insurance coverage would pay an assessment of $2,000 per full-time worker if any of their workers gets a tax credit to buy coverage.
- Employers with more than 200 employees would be required to enroll all employees automatically in their health-insurance plans, though workers could still opt out.
- Legislation would place a $2,500 limit on what can be contributed to employer-sponsored flexible spending accounts funded with pre-tax dollars from employees.
Here’s 10 Things the new health care reform means for you and your family.
- New insurance plans would have to pay full cost of certain preventive care and exempt this care from deductibles. (The requirement wouldn’t apply to existing policies until 2018.)
- Insurers wouldn’t be allowed to cancel policies just because a person became sick
- No more lifetime or annual caps on coverage
- Insurers would be barred from denying adults coverage because of a pre-existing health condition. (The provision doesn’t take effect until 2014.)
- Adults with pre-existing conditions may buy into a national high-risk pool until the exchanges come online.
- Children could stay on their parents’ insurance policies until their 26th birthday
- Children under age 19 may not be excluded for pre-existing conditions
- The “donut hole” closes for Medicare patients, making prescription medications more affordable for seniors.
- Requirement that all insurers must post their balance sheets on the Internet and fully disclose administrative costs, executive compensation packages, and benefit payments.
- For patients frustrated by attempts to get reimbursed for insurance claims, the government would establish an ombudsman and a claims process to help them reconcile contested medical bills. The spirit of the past must be empowered by the possibilities of today.
Like Social Security, Medicare, Medicaid, Sunday’s vote will forever be a watershed moment for the nation. Generations to come will look back to this historic vote as one where the American dream was more fully realized. After this bill passed, President Obama said, “We did not fear our future, we shaped it.” In the Declaration of Independence it says, “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights that among these are life, liberty and the pursuit of happiness.” When our forefathers referred to “Life,” in this historic document, it meant preservation of life in the form of access to quality health care. The single leading cause of the massive health care disparities and premature death in America is access to affordable health care. It is my hope that in the years to come access to healthcare becomes a moot issue for all Americans.
Reference Articles:
New York Times: House Approves Health Overhaul, Sending Landmark Bill to Obama http://www.nytimes.com/2010/03/22/health/policy/22health.html?pagewanted=1
Wall Street Journal: Consumers Would See Impact Soon After Health-Care Bill’s Enactment http://online.wsj.com/article/SB10001424052748704534904575132110999558770.html
Business Week: New Taxes for Health Care Help Obama ‘Spread the Wealth Around’ http://www.businessweek.com/news/2010-03-22/new-taxes-for-health-care-help-obama-spread-the-wealth-around-.html
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Melinda Emerson “SmallBizLady” is a Veteran Entrepreneur, Small Business Expert and Social Media Coach who hosts #SmallBizChat on Twitter. #SmallBizChat is the trusted resource on Twitter to discuss everything entrepreneurs need to know about launching and running a profitable small business. Melinda’s first book, Become Your Own Boss in12 Months was released by Adams Media in March 2010.
If you’re ready to start or grow your small business subscribe to Melinda Emerson’s blog at www.succeedasyourownboss.com
Very clear and concise article. You did a good job explaining how this will affect business owners.
Stephen–
Thank you for your comment. I thought it was important to explain how this law will affect small business owners. I am glad it was helpful.
Best of luck with you business.
Melinda
What your post did NOT cover, nor disclose, is the amount of taxes that will now be taken out of everyone’s paycheck (entrepreneurs included) to help pay for this. Great, everyone will now have healthcare. But it comes with a cost and it’s frustrating that many are not willing to talk about this aspect of our realized “dream.” Please do not refer to this comment as me “hating” on the decision. I’m concerned and I’d like the full picture.
Jeff–
Thank you for your comment. I think the taxes are worth it if it stops the insurance company from raise premiums arbitrarily and capped coverage when people get sick. I really think insurance companies should be forced to become non-profits, then the care of patients would be top priority not profits. All opinions are welcome on my blog.
Best–
Melinda
Melinda, thanks for responding. A few things, though:
1) The last thing I want to do is sound cold-hearted. But the economy is hurting a lot of people in a big way. If an additional 10, 15, 20 percent comes out of my income to pay for this plan, it’s not a good thing. In my opinion we need cost reform, not health reform. Have the doctors go on salary and limit medical malpractice – two big areas you’ll keep costs down without taxing the heck out of people.
2) You’ll never get any insurance industry to go non-profit because of the element of risk involved with coverage.
If I have more than 50 employees, but less than 200 and I offer Health Coverage already to those that maintain 32 hours per week, and pay 75% of the cost. What does this do to my company? Has their been any details related to FTE’s (Full Time Equ)?
Dan–
I believe that you will now get a 35% tax credit for each employee that you provide health insurance for which would be great for your business.
I am learning this stuff too, but I will give you the benefit of my research.
Here’s to your business success.
Melinda
Glen–
Thank you for coming by and letting me know that you love what I’m doing. I will keep it up.
Best–
Melinda
Melissa,
This is the worst article I have ever seen advising small business owners (no hyperbole). Everyone who reads this will be dumber for having done so. This is a political cheerleading article for Obama and the Democrats masquerading itself as an informative article for small business owners on recently passed legislation.
You wrote: “When our forefathers referred to “Life,” in this historic document, it meant preservation of life in the form of access to quality health care” —
Call me crazy, but I believe when the founding fathers wrote “life.. happiness” – they were referring to a right to life, not healthcare/insurance. If they meant everyone had a right to healthcare/insurance – they would have said so.
This is the worst bill passed in American history, as its is a vast power grab by the Democrats and the Federal government into arenas never intended nor imagined by the founding fathers. Ultimately, the productive sector of society will be stretched to the breaking point, and healthcare will soon be rationed by quiue rather than medical necessity.
Martin Luther King, one of the truly great American figures in its history once said “Justice delayed is justice denied” – well I think the same logic applies here: healthcare delayed is healthcare denied. We will soon all have equally crappy healthcare will equally crappy lack of access to a doctor. This is healthcare reform in name only. Waht it really is is a massive socialist wealth redistribution masquerading itself as healthcare reform. You fell hook, line, and sinker for big brother’s propoganda. American Small Business Owners- The greatest wealth engines the world has ever known, will be greatly harmed, rather than helped, by Obamacare. It is disingenuous for you to imply otherwise. If you support Obamacare – thats fine, but don’t lie and say its good for small business when clearly it is not. How the hell does raising taxes on businesses and individuals good for small business? Money that could be spent on developing that next great idea (ie google) or life saving medical device will now instead be going to uncle sam. If google, in its early stages, had to provide healthcare (or pay a fine) to its employees, when it was just a few guys in a garage, it never would have gotten off the ground, and the world would be worse off. Think about that Melissa before speaking.
.-= John Galt´s last blog ..Castlevania: The Adventure =-.
John–
I appreciate your comment, but I could not disagree more. Small businesses including my own have been struggling to pay for health insurance for years–now at least we will all get a 35% tax credit per employee for doing it. I never said this legislation was perfect. As for your reference to Dr. Martin Luther King Jr., I can imagine he would have been in full support of 31 million uninsured Americans getting health insurance.
Best–
Melinda
Very important — you neglected to mention the time limes on the credits and requirements. Two years does not save much for the small business.
I love everything about health reform. Kudos for getting this passed. However, and I write with a capital HOWEVER, I am worried that we did nothing to address premiums. Health insurance companies are in business to make a profit. And they will continue to do so on the backs of all of us. It’s not enough to make a profit, these publicly traded companies MUST also show growth in order for their stock to rise. I am afraid that we as consumers are screwed. By the way, in California a doctor can only be sued for up to $250,000. This cap has been in place for 30 years. Take a guess, have premiums for doctors gone up or down in this time period. Caps are just an excuse for insurance companies to continue gouging everyone, including doctors. I have a funny feeling that at the end of the day this bill will be just like credit card reform. Credit card companies had 18 months to screw us and they did.
fairly useful stuff, all in all I picture this is worthy of a book mark, cheers