Business Owner, Jim Houser, responds to the ACA
Jim Houser, co-owner of Hawthorne Auto Clinic, reflects on what it means to be a small business owner amidst the impacts of the ACA. He recounts the headaches of what it was like to provide health insurance to his employees prior to the Affordable Care Act and shares the many benefits that the Act provides to his business.
When my wife Liz Dally and I opened Hawthorne Auto Clinic 29 years ago, we made the commitment to offer those who worked with us a good benefits package, including comprehensive health care.
Health care is a major issue for small businesses like ours and others in the auto repair industry. We're in a high-skill field where being able to offer good benefits to keep good people is very important. Plus, we're an aging profession. These factors make health care critically important.
But for American small businesses, health care has been an unrelenting headache, with:
- Small businesses’ health care costs growing 129% since 2000,
- Workers paying an average of 18% more for premiums than those with larger firms, and
- Administrative costs eating up two and half times more of their premiums than larger businesses pay.
In fact, less than half of America’s smallest firms could afford to offer any health care benefits at all. Health care costs for our 10 full-time employees and their families doubled in 8 years to equal over $100,000 dollars in 2010 (20% of payroll).
But now, thanks to the Affordable Care Act, this is what we and other American small businesses can look forward to:
- Small business health insurance tax credits. Our small business received $12,903 credit on our 2010 taxes to help us pay our health insurance premiums. This nearly $13,000 gave us the confidence and the resources to promote a student intern to full-time technician. Also, our premiums decreased 3% each of the last 2 years
- Health insurance exchanges, which will provide more choices and more bargaining power for small business and individuals. It is predicted that as many as 970,000 people will enroll in Oregon’s new health insurance exchange when it opens in 2014. I currently serve of the Consumer Advisory Committee for the Exchange.
- Medical loss ratio (MLR) requirements to ensure that small businesses get real value for our premium dollars. Insurance companies in Oregon have already had to rebate hundreds of dollars to their individual policy holders for exceeding the loss ratio requirements.
- Rate review - giving states new tools to protect small businesses and other insurance customers from unreasonable rate increases. Oregon’s rate review process has cut rate increases nearly in half over the last 2 years.
Of course this is on top of the benefits that will benefit all individuals, including:
- Prohibitions on: lifetime dollar caps, rescinding coverage (except in cases of fraud), and exclusions for pre-existing conditions.
- Expanded dependent coverage to age 26. Our 24 year old daughter has been able to rejoin our health insurance plan.
- An emphasis on preventive care, including mandatory coverage for routine immunizations, screenings for conditions such as cancer, high blood pressure and high cholesterol, and preventive services for women. Consider: According to American Heart Association, stroke is the leading cause of disability and the third leading cause of death in the U.S., yet up to 80% of strokes are preventable. It is far cheaper to provide $30 worth of blood pressure meds during a preventive services screening than to provide a $30,000 ER stroke response.
Now that our Supreme Court has ruled that the essential elements of the ACA are, indeed, Constitutional, we all have the important task of implementing and improving this landmark legislation that finally begins to address the health care crisis in our country.