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Your Bottom Line: What Health Reform Means For Wisconsin Small Businesses

Your Bottom Line: What Health Reform Means For Wisconsin Small Businesses. Jessica Stone Small Business Majority. About Small Business Majority. Public policy advocacy organization – founded and run by small business owners

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Your Bottom Line: What Health Reform Means For Wisconsin Small Businesses

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  1. Your Bottom Line: What Health Reform Means For Wisconsin Small Businesses Jessica Stone Small Business Majority

  2. About Small Business Majority • Public policy advocacy organization – founded and run by small business owners • National – based in California – offices in Sacramento, Washington, DC and New York • Research and advocacy on issues of top importance to small businesses (<100 employees) and the self-employed • Very focused on healthcare over the past 5 years – top issue in all of our research

  3. Small businesses struggling with costs • Soaring cost of health insurance – especially for small businesses – 54% of businesses <10 employees don’t offer (Kaiser study) • 28% self-employed: not covered • Small firms pay 18% more than large businesses Our national study: Small business health costs will more than double over the next 10 years – $2.4 trillion total

  4. Small businesses struggling with costs Our opinion surveys: 86% of small businesses don’t offer because of cost; 72% of those who do offer say they are struggling to do so

  5. The new federal law • Builds on and seeks to fix our existing healthcare system • Aims to rein in healthcare costs; reduces deficit by over $100B by 2020; by $1.3T by 2030 (according to the Congressional Budget Office) • Implementation is primarily the responsibility of the states – essential to have small business input • Important immediate benefits – other key provisions to be implemented over the next 4 years

  6. Immediate Consumer Protections • Bans health plans from dropping insurance coverage when an individual gets sick (Sept. 23, 2010) • Insurers will no longer be able to deny coverage for patients with pre-existing conditions (2010 for kids, 2014 for adults) • Ban on lifetime caps that rescind coverage when people get sick (Sept. 23, 2010) • Adult children under 26 can stay on their parents’ plan (Sept. 23, 2010) • First-dollar coverage for preventative care for all new plans (Sept. 23, 2010)

  7. 3 Key provisions of health reform for small businesses • Provides immediatetax credits for most small businesses ($40 billion in credits by 2019) • Provides immediate access to a Preexisting Condition Insurance Plan for the self-employed • Establishes a competitive marketplace for small businesses and the self-employed

  8. I. Small business tax credits Our report: 86,100 Wisconsin small businesses are eligible (86.8% of all businesses); 25,800 businesses eligible for the maximum credit

  9. II. Preexisting Condition Insurance Plan (formerly high-risk pools) • Available to individuals -- incl. self-employed • Takes effect immediately • Eligibility: Individuals who have been uninsured for six months and have been denied coverage for a preexisting condition or have a letter from a physician stating they have a preexisting condition. • Plans = lower premiums due to federal funding ($5 billion over 5 years) • Available until full implementation in 2014 (no gap in coverage)

  10. PCIP in Wisconsin • Run by the state Health Insurance Risk-Sharing Plan (HIRSP) • www.hirsp.org

  11. Other immediate changes • Grants to study small employer wellness programs • $9M granted in 2011 • Reduce the risk of chronic disease among employees and their families through evidence-based workplace health interventions and promising practices. • Promote sustainable and replicable workplace health activities. • Promote peer-to-peer healthy business mentoring. • Medical Loss Ratio or the “80/20 rule” (2011) and Rate Review • Increased access to care - community health centers (2011)

  12. III. State Health Insurance Exchanges: Coming in 2014 • Large marketplace to shop for health coverage • Purchasing pool to increase buying power and reduce administrative costs • Small businesses with fewer than 100 workers eligible • Private insurance plans will compete • Improved competition will increase employer choice • Exchange will negotiate with insurers on behalf of small businesses to ensure higher quality and lower costs • RAND Study • Exchanges will expandcoverage to 85.9% of small business employees, up from 60.4% today, an increase of 10.5 million workers

  13. State Health Insurance Exchange • Compare plans and get detailed information about price, quality and service • Plans organized by category: bronze, silver, gold, platinum • Calculator to compare costs across plan options • Streamlined billing process • One-stop shop web portal Small Business Exchange INSURANCE PLANS EXCHANGEChoiceComparisonBillingTax Credits SMALL BUSINESSES

  14. State Insurance Exchange:Other Benefits • Many small business workers and self-employed entrepreneurs will receive affordability tax credits towards their premiums • Up to 400% of federal poverty level (approx. $90,000 for a family of four) • Incentives for administrative efficiency and modernization • Expanded coverage and individual responsibility requirement – reduce hidden tax

  15. State insurance exchange • States determine whether to keep the individual and small group markets separate or merge them • Insurance will still be sold outside exchange • Members of Congress must use the exchange

  16. CO-OP Plans: More choice • $3.8B invested in new CO-OP health plans • Plans must operate with a strong consumer focus, profits must be used to further its mission through lower premiums, improved benefits, or improved quality of care • A team of small business, community and health insurance professionals with an 11-member board formed the Common Ground Healthcare Cooperative in the Milwaukee, Wisconsin region. • HHS awarded the new WI CO-OP a $56.4 million loan. • http://www.commongroundhealthcare.org/

  17. What does this all mean for your bottom line? Changes in average employer contribution per person covered

  18. Exchange – key issues • Active vs. passive (can the exchange negotiate?) • Regional exchanges • Role of brokers • Expanding exchange to large firms in 2017 • Incorporation of wellness and prevention programs • Administrative/design issues: billing, payment, web, etc. • Effective education and outreach

  19. Shared responsibility • Businesses with fewer than 50 workers – 96% of all businesses – are exempt from any requirement to offer insurance

  20. Resources • National HHS website: www.healthcare.gov • Our website: www.smallbusinessmajority.org • “What’s in Healthcare Reform for Small Businesses” • Detailed FAQ • Tax credit calculator

  21. Join Our Network Contact • Erica Dowell, Network Coordinator • Email: edowell@smallbusinessmajority.org • Direct: (202) 535-3244 • Ways to Get Involved: Connect with us! @SmlBizMajority Small Business Majority • Receive a monthly newsletter • Share your story for media requests • Letters to the editor/Op-eds • State events/Roundtables • Fly-ins • Webinars for business organizations

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