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Health Reform Helps Small Businesses

By Carol Duh-Leong

In medical school, we blame our teachers and our textbooks for the exam question with the lowest correct student response rate. Since this is the week to get the truth out about the Affordable Care Act, and Doctors for America is dedicated to making sure we understand the health policy that affects us all, we took a look at the material that we as a nation should review.

The Kaiser Family Foundation put out a short ten-question quiz to test our knowledge of the new law that you can take here. After finishing the quiz, you can compare your score to the rest of the participants. As of tonight, March 20, 2011, the question with the lowest correct response rate (at 25%) was,

Will the health reform law require all businesses, even the smallest ones, to provide health insurance for their employees?

The answer is “No.” The health reform law does NOT require employers to provide health benefits. The legislation penalizes employers with 50 or more workers that do not provide insurance to their workers or that provide only unaffordable coverage. However, there is no base requirement.

Supporting small businesses and helping them offer health insurance to their employees is vital to the success of the health reform law, which aims to have as many Americans as possible insured and protected. Small businesses often struggle to offer insurance because higher administrative expenses make the plans more expensive than at larger companies. Health coverage is a good thing. The ability to offer health coverage will allow small businesses to attract talented workers, and keep their own workers healthier.

The new law incentivizes small businesses to provide health coverage. Companies with less than 25 full-time employees that have average employee salaries of less than $50,000 but also pay half of the cost of health insurance for their employees are eligible for a tax credit. (Hint: this is also the answer to question #8 on the Kaiser Family Foundation quiz!)

Last October, researchers in The New England Journal of Medicine used a simulation model to predict the impact of the new insurance exchanges built for small firms that will help them access insurance for employees. Calculations forecast that the number of workers covered will increase from 115.1 million, or 84.6% of all workers, to 128.7 million or 94.6%. The research suggests that this increase is buoyed by small businesses in a better position to offer coverage.

Learn more about the ACA and small businesses here.  

Do you understand how the ACA affects you? This is the week to get ourselves educated about the new law and make the grade!

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