Thursday, March 6, 2014
Most of us in Maine are employed by small businesses. Providing health care for workers has become unaffordable for many of those companies.
The new federal health care law, the Affordable Care Act (ACA), is intended to lower the cost of health insurance, in part, by requiring businesses employing 50 or more full-time workers to buy health insurance for their employees, or be fined. The assumption is that health insurance premiums will drop for everyone if more people are covered, especially young healthy workers.
However, to avoid being forced to buy health insurance with the expensive ACA requirements, many struggling small businesses say they have no choice but to stay below the 50-worker threshold or hire part-time help. In either case, there would be fewer full-time jobs for our fellow Mainers looking for work during these very difficult times.
Take a look at this article from last Friday that appeared in USA Today and other newspapers around the country: "Health care act? No thanks; we’ll take care of ourselves."
An increasing number of small businesses with younger workforces that can afford to provide health care for their employees are “self-insuring” to avoid the expensive and unnecessary mandates of the new law. These companies are paying out-of-pocket for most of the normal health care costs for workers, and then buying cheaper stop-loss coverage for extraordinary expenditures such as extended hospitalization or complicated surgery. Many families follow a similar strategy by paying out-of-pocket for routine doctor visits and prescription drugs, and then by purchasing a high-deductible policy to cover expensive care for catastrophic illness.
Will Washington continue to allow small businesses to provide health care to their workers through this less costly self-insurance process? Or, will the federal government force these critically important employers to adopt the more expensive insurance and benefits mandated by the ACA?
Who knows? The new federal health care law requirements don’t begin until January 1, 2014. What we do know is that things often get overly expensive and complicated when government dictates how we must live and work.
Bruce Poliquin is the former Maine State Treasurer and a 2012 Republican primary candidate for the United States Senate. He has 35 years of experience owning and managing businesses. Bruce is a proud third-generation Franco-American Mainer and Harvard University graduate. Visit BrucePoliquin.net for his most recent commentary and analysis on media outlets throughout the State about the important issues facing Maine families and their jobs.