Inside the Debate: Small Businesses and "Obamacare"
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Inside the Debate: Small businesses and “Obamacare”


As the health care act—commonly known as Obamacare—continues to be hotly debated in the Supreme Court, small business owners take their places on either side of the fence. While the National Federation of Independent Businesses is one of the entities challenging the act in court, other small businesses support the act. To gain a better understanding of the conflict, here is an in-depth look at the act, its proponents and its critics.

Inside the debate: Small businesses and “Obamacare”

The Affordable Care Act basics
Signed into law in 2010 after widespread debates, the law has aims to affect nearly all aspects of health care reform. The law would result in the largest overhaul in 50 years of America’s $2.6 trillion health care system, reports Reuters. This includes patient protection, universal coverage and lower insurance costs. For employers, the law hopes to ease the costs of employee health care. Provided that businesses with 200 employees are 99 percent likely to provide health care, according to BusinessWeek, small businesses lie at the heart of this conflict.

Provisions for small businesses
Small businesses in particular are meant to benefit from the Affordable Care Act. Employers with fewer than 25 employees can qualify for a tax credit of up to 35 percent of insurance costs. By 2014, the tax credits can account for up to 50 percent of insurance costs. The Affordable Care Act also aims to relieve early retirees, so they are covered during the time between early retirement and the start of Medicaid benefits.

Small businesses against the act
The NFIB argues that the act is both costly for small businesses and plain unconstitutional. Karen Harned, a legal executive at the NFIB, told CNBC that small businesses report higher costs on health care, primarily due to the bill. Harned reports that anywhere from 20 to 40 percent of small businesses have seen higher premium costs since the bill was passed.

Business owners also argue that the new law will create cumbersome bureaucratic processes for providing health care. In a CNN article comparing two small business owners’ personal views on the health care act, one business owner describes the new act as an introduction of excessive paperwork. John Nicholson, who employees 15 employees, told CNN that the act “means basically that all of a sudden, [he’s] going to have to answer to government, filling out forms.”

Small businesses supporting the act
Some small business owners report success in line with the act’s mission. One small business owner, Mike Roach, told CNBC that he expected over $7,000 in tax refunds—thanks to the new credit. If successful, the Affordable Care Act will help employers provide health care without cutting back on labor.

The act additionally aims to make insurance policies more competitively priced through a federally mandated health care exchange. One Florida businesswoman, Louisa McQueeney, has spent nearly $2000 a month on health care for her four employees, reports NPR. Like Mike Roach, McQueeney anticipates over $7,000 in tax refunds this year. If the law passes through the Supreme Court unscathed, the full implementation in 2014 would mean even higher tax refunds for small business owners.

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