For decades, hardworking entrepreneurs have faced skyrocketing health care costs. And that directly stunts their ability to grow. Small business owners want to provide benefits for their employees—we know that from our research. We also know affordability is the most common concern among small business owners who don’t offer coverage. But the Affordable Care Act is changing that. Health insurance exchanges and small business tax credits are giving small firms the kind of clout that large businesses enjoy in the marketplace, making it easier for them to afford health insurance for their employees. As we quickly approach 2014, when coverage expansions take effect, it’s imperative to educate small business owners about the cost-saving opportunities and coverage options that will be available to them and to their employees.
The Importance of Small Businesses in Communities
Small business owners are one of the most influential groups in the United States. That’s why it’s critical to reach out to them over the coming year to ensure that they learn about health coverage options for themselves and for their employees. According to the Pew Research Center, small business is viewed positively by 71 percent of the public, and, as a group, small business owners are more trusted than churches, academic institutions, large corporations, and more.
What’s more, as the nation’s top job creators, entrepreneurs are a trusted source of information and are able to help make strong economic and jobs arguments. Small businesses represent 99.7 percent of all employer firms and half of private sector employment. Small business owners are the fabric of their communities, and, most often, they are pragmatic individuals who put business before politics. Numerous surveys have shown they are extremely diverse politically, which is another reason small business is viewed positively by so much of the public.
Who Do Small Businesses Turn to for Information?
The online health insurance exchanges that must be up and running in 2014 are the most important component of reform for small firms. But major outreach efforts are necessary to inform entrepreneurs about this new option for purchasing coverage. Our research has found that brokers are an important element in the outreach process to small businesses around the exchange. As trusted sources of information, they have a key educational role: 75 percent of small business owners with fewer than 20 employees use brokers, and 88 percent of them say their brokers’ opinions carry significant weight. In addition to brokers, small business owners also rely on accountants, chambers of commerce, and trade groups as information sources. These groups have the potential to be extremely effective messengers when it comes to educating people about the new health coverage options that will be available starting October 1, 2013, which is why it’;s important to get them involved in outreach and enrollment efforts now.
Along with the insurance exchanges, small businesses should also be informed about tax credits that are available in the law. Small businesses with fewer than 25 employees and average annual wages below $50,000 who cover at least 50 percent of premiums are eligible for a tax credit of up to 35 percent. Among eligible owners, awareness of this credit isn’t nearly as high as it should be. Our recent opinion poll found that more than half of all entrepreneurs do not know the credit exists.
Clearly, there’s plenty of work to be done to educate small employers about enrollment opportunities in their communities. Conducting outreach to 6 million small employers and 21 million self-employed entrepreneurs will be difficult. But with all hands on deck, we can make sure small business owners know exactly which coverage options are available and how they can benefit from them.]]>