Are you confused by all the changes in the Affordable Care Act?
Are you tired of trying to navigate the complexities of buying health insurance coverage for employees?
Have you seen an increase in premiums?
If you, like me, are a typical small business owner you probably answered yes to all of the above. We are not alone. A survey just released by the National Small Business Association (NSBA) confirmed what many of us already know. It is getting more and more complicated to provide coverage for our employees. Not to mention expensive.
The NSBA 2015 Small Business Health Care Survey is a follow-up to a 2014 survey but the data goes all the way back to 2009 so it does a great job of showing trends. You can read the complete report at www.nsba.biz
I want to focus on just a few of the findings. I have offered health benefits to employees from the first day we opened the doors. That’s because I, like a majority of small business owners, believe that it is important. It helps me attract and keep good employees. There is however a difference between thinking something is important and actually doing it.
The survey states, “Just 41 percent of firms with zero to five employees offer health benefits, down from 46 percent one year ago. Overall, 65 percent of small firms (those with fewer than 500 employees) report offering health insurance today, down from 70 percent one year ago. For the smallest firms, those with zero to five employees, the offer rate is less than half that of their counterparts with 20 or more employees.”
So what does this mean? I believe that many are getting tired of the time and effort it takes to administer plans. Small business owners unlike large companies do not have an HR department to handle benefits to it is our time that is expended. Small business owners are also concerned about costs. In fact, it was the number one factor in determining how or if they could purchase insurance. The survey also reported, “A whopping 90 percent reported increases in their health plan premiums at their most recent renewal, while 95 percent reported increased health insurance costs over the past five years.” I experienced this first-hand with my last renewal.
So what can business owners do? You can increase the amount that employees pay as a percentage of their premium. You can lay-off workers or simply not add staff by using freelance workers or subcontractors. Or if you are a small business that is not required to carry coverage you can simply do away with your plan and let employees cope.
In December of 2013, I was interviewed by TIME magazine for an article on health insurance titled. “Is Your Plan in Play?” At the time the reporter asked me what I would do in the face of rising costs-would I consider getting out of the business of providing coverage. I said I would try to find other options. Two years later, with costs still on the rise, I still don’t have a good answer but I will keep working on it.