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The Economic Impact of Healthcare Reform on Small Business

The Economic Impact of Healthcare Reform on Small Business. Presentation by Ben Geyerhahn Small Business Majority. Small Business Majority.

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The Economic Impact of Healthcare Reform on Small Business

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  1. The Economic Impact of Healthcare Reform on Small Business Presentation by Ben Geyerhahn Small Business Majority

  2. Small Business Majority • Small Business Majority is a national nonprofit organization, founded and run by small business owners, that brings the voice of America’s 28 million small businesses to the public policy table. • SBM is focused on solving the single biggest problem facing small businesses today: the skyrocketing cost of healthcare. • SBM uses scientific research to understand and represent the interests and needs of all small businesses, from sole proprietors to 100-person companies.

  3. Why Did We Commission this Study? • More than any other sector of the economy, small business suffers from our broken healthcare system. • Spiraling costs and inadequate access to high-quality healthcare are slashing profits and hurting growth. • The cost of doing nothing is simply too high to contemplate.

  4. Small Business and Healthcare • Approximately 70% of those people who are working full-time and have no healthcare work in small business. • There is an inverse relationship between the size of a company and the likelihood that it offers healthcare. • In New York, small businesses on average pay 18% of payroll to satisfy health insurance premiums.

  5. The Study • SBM commissioned MIT economist Jonathan Gruber to model the impact of 4 reform scenarios on small business costs, jobs, wages and profits compared with that of no reform. • Dr. Gruber analyzed several reform scenarios from across the ideological spectrum: • Baseline: no change to current system • Two Shared Responsibility Scenarios • Single-Payer • Market Reform

  6. The Perspectives of NY Small Businesses • Characteristics that drive healthcare premium decisions: • Size: • Smaller businesses are less tolerant of premium increases and additional paperwork driven by plan complexity. • Profit margin: • Businesses with high profit margins view healthcare as a tool to attract employees where low profit-margin businesses view healthcare through the prism of cost alone. • Firms offering and not offering health insurance: • The impact of taxes, fines or other devices utilized by various healthcare reforms varies substantially based on whether a business is or is not offering health insurance. For those not offering, this is a cost that can derail them; for those that are, these fines or taxes are a nonissue.

  7. Detailed FindingsCost of Health Benefits

  8. Detailed FindingsCost Savings Under Reform

  9. Detailed FindingsJob Loss Due to Health Costs

  10. Detailed FindingsJob Loss Impact Under Reform

  11. Detailed FindingsWages Lost Due to Healthcare Costs

  12. Detailed FindingsWages Saved Under Reform Scenario

  13. Detailed FindingsProfits Lost Due to Healthcare Costs

  14. Detailed FindingsProfit Savings Under Reform

  15. Detailed FindingsProfit Savings Under Reform

  16. Conclusion • America’s small businesses are suffering under the current healthcare system • A system based on shared responsibility among individuals, businesses, government and the healthcare industry that: • Substantially contains cost • Guarantees access to coverage • Offers appropriate assistance to small businesses will save small businesses hundreds of billions of dollars in costs, protect small business wages and jobs and allow small business owners to reinvest in and grow our economy.

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