The Affordable Care Act: A Small Business Booster

Some of us are wishing happy two-year birthday this week to the Affordable Care Act. Some of us are not and are praying the U.S. Supreme Court strikes it down.

And that's understandable because of the philosophical differences between those for and those against the ACA. Nevertheless, what many of us — except those who still regard America as having the best health coverage on earth despite the statistics — there is the recognition that our current system is unsustainable.

Small business is one of the segments of our economy that has especially felt the impact of our dysfunctional healthcare system, hard. Over half the bankruptcies in this country are a result of medical bills, and no doubt many small business owners have had to close up shop when they hit the financial rocks.

This fact is very true here in Wisconsin, which has some of the highest health insurance costs in the country. An independent contractor friend of mine recounts how his health insurance premiums are higher than his house payments.

The real job creators in this country are smaller businesses, and for years they have had to struggle with the challenge of hiring staff in the face of rapidly rising health insurance premiums while dealing with competition from big business for the talent they need. Too many have this choice decided for them. For those who feel that government has been the enemy of small business, they are forgetting the damaging effects big insurance companies have had on families and on small business success.

Until they become big businesses, the plight of small business owners and their employees is no different than the average person. During the first half of 2011, one in three Americans lived in a family that struggled to pay medical bills, and many small business owners, and especially new start-ups, are among those. A recent survey by the Small Business Majority found that providing health insurance was the prime concern of small businesses.

With all the burdens faced by small businesses to make it from year to year, a smart country would find a way to lift the healthcare load. Certainly the ACA is a step towards achieving that goal.

Over the past two years since the enactment of the ACA, small businesses throughout the country have already benefitted from new access to tax credits, which help to lower premiums. In 2011, 62,800 Wisconsin businesses qualified for a tax credit. This feature enables small businesses to offer comprehensive coverage like never before. Small Business Majority found in another survey conducted in 2011 that one-third of small business owners who didn't offer insurance would be more likely to do so because of these provisions.

Here are the unappreciated benefits. Most small businesses function like a team. For one of those team members to deal with a personal health problem affecting themselves or a member of their family is a major distraction. Throw in the collateral worries of having to pay for those procedures if all the team members "are going naked" in terms of healthcare coverage.

The Affordable Care Act enables a leveling of the playing field. The name of the game is attracting talent, and a small company is at a distinct disadvantage if they can't afford to offer healthcare to attract that talent.

Of course the big news is the announcement last week by Common Ground of a $56.4 million federal loan to set up a health care cooperative to serve the insurance needs small businesses and others in southeastern Wisconsin. The loan was made possible thanks to the Affordable Care Act, and like all of the other cooperatives sprouting up across the country, the plan will activate in 2014, enabling main street small businesses to have the mass buying power of big business.

It would be foolish for anyone to think we can afford to do nothing when it comes to reforming healthcare in America. The nibbling around the edge solutions proposed by the right is not going to cut it. For all the faults of the Canadian health care system, at least business owners don't have to waste hundreds of hours dealing with their company's health care plans like their competition in the States.

For better or worse, President Obama laid a pile of political chips on launching this bill, and many, including a fair number of Democrats, felt that early 2010 was the wrong time to do this, especially with the demands for improving employment in the depths of this recession.

But this was the only time to pass something this major when the President's popularity and political capital was at their peaks.

Turns out, in reality the President and the Congress enacted a jobs bill — for the long run. By working to lift the burden of health care coverage, small business owners and their teams can focus on what they do best and what is the best for this country — create jobs.