December 22, 2014

Small Business

Small business healthcare plans

Rising premiums = Tough choices

Mike Vogel | 2/1/2012

Offering Health Benefits

Company size 1999 2011
3-9 workers 55% 48%
10-24 74 71
25-49 88 85
All small firms (3-199) 65 59
Large firms (200+) 99 99
Source: Kaiser Family Foundation
Some businesses have reacted to rising premiums by cutting employees to seasonal or part-time hours to keep from having to insure them. "The economy in general has caused employers to look at every expense," Lago says. Some have dropped coverage altogether.

Alan Sayler, owner of Sayler's Suncoast Water in Pinellas Park, a water conditioning company for homes and businesses, looked at dropping group coverage after a 33% increase in 2011 brought his per employee premium to $436 a month (of which he pays $296). If "any other vendor increased their costs like that, you would be yelling and screaming," Sayler says. Having recovered from prostate cancer in 2000, Sayler had trouble finding an individual policy for himself; one of his employees with a pre-existing condition would have had an individual policy premium that was "outrageously expensive." So Sayler elected to keep group coverage for himself and his two full-time employees. A particular object of Sayler's ire is what he sees as Washington's intrusion in the marketplace and specifically the healthcare bill Congress passed in 2010.

"There's a lot of uncertainty until the Supreme Court rules on the healthcare reform law," says Ken Stevenson, legislative chair for the Florida Association of Health Underwriters who's with the Earl Bacon agency in Tallahassee.

The new healthcare law includes a tax credit for small-business owners, but it has proved difficult to obtain. Says Lago, "It's not easy to do that, but there's a nice benefit if you can." Hurley's firm didn't qualify — not enough lower-paid workers.

Hurley doesn't like to think of a repeat in 2012 of higher deductibles, lesser benefits and premium increases. "If that continues this year, it's not a pretty situation."

The Case for a Plan B


Before the healthcare overhaul, Florida conceived its own initiative to create a small-business healthcare insurance marketplace. The state expects to roll out Florida Health Choices this year. Employers with fewer than 51 employees will be able to shop by web portal for plans in their county.But the marketplace won't meet the new federal mandate that each state create an exchange meeting federal approval by Jan. 1 or face having the federal government run one for it. Befitting Florida's leading role in having the overhaul declared unconstitutional, the Legislature last year didn't bring out legislation to create an exchange consistent with the federal law's requirements. Some in the industry want it to do so. Rather than have the federal government impose one, "let's put a plan B together just in case," says Ken Stevenson, legislative chair for the Florida Association of Health Underwriters who's with the Earl Bacon agency in Tallahassee.

Tags: Florida Small Business, Healthcare

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