Friday, August 2, 2013

Obamacare good for small business


Since the Patient Protection and Affordable Care Act was passed in 2010, critics have piled on the scary warnings about how federal mandates would mean death panels, individuals would be dragged off to jail because they couldn’t afford government-mandated insurance and small businesses would be boarded up all along Main Street.
    As the provisions of the act finally begin to take effect, Obamacare is turning out to be a pretty good deal for small businesses like Express Publishing, Inc., which publishes this newspaper.
    Obamacare requires insurance companies to spend at least 80 percent of premiums collected on patient care. That includes premiums paid by companies like the Express, which began providing health care coverage for employees in 1980. It turns out that our insurance provider, among many, missed that target this year. So this week, it sent us a substantial refund.
    Over the past decade, annual double-digit premium increases often arrived in our offices without warning, sending us scrambling to find ways to maintain coverage for our employees. Benefits to families were reduced, deductibles raised, stop loss limits increased. We became expert in insurance company jargon, scouring through complex plans for ways to keep from dropping health insurance altogether.
    The Express is not alone. The cost of providing that insurance has become a very big deal as companies, especially small ones with their tight margins, struggled with premiums that rose far in excess of the cost of living.
    Before those who support less government regulation or who worry about private corporate health weigh in, let us assure our readers that we believe in profits, too. They are, as famous business guru Peter F. Drucker said, simply the cost of capital. We also believe that corporations need administrative functions, including marketing, to produce and sell goods and services. And we believe companies in a competitive marketplace have the right to set their terms of business, including pricing.
    But health insurance does not operate in a competitive marketplace. Many health insurance providers are nonprofits that do not pay federal income taxes and record and maintain “surpluses” rather than profits and retained earnings. Insurance companies operate under regulations that control both returns and risks.
    Obamacare is far from perfect. It will undoubtedly be modified. For now, however, Obamacare is making good on its promises to small businesses of patient protection and affordable care.




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