ACA To Lower Costs for Small Businesses, Raise Costs for Larger Firms
If the Affordable Care Act was fully implemented this year, health care costs for businesses with up to 100 employees would have decreased by 1.4%, and the rate of U.S. residents with employer-sponsored coverage would have risen by 2.7%, according to a new Urban Institute study, Kaiser Health News' "Capsules" reports.
The study found that the ACA would decrease costs-per-person for businesses that employ fewer than 50 workers by 7.3% (Carey, "Capsules," Kaiser Health News, 10/9). The report noted that small businesses would benefit from tax credits and purchasing efficiencies created by the ACA.
Overall, about four million more employees would have had employer-sponsored insurance if the law had been fully implemented.
"[T]he evidence simply does not support critics' arguments that the ACA will burden employers and undermine employer-sponsored health insurance," the authors wrote, adding, "[T]he ACA benefits rather than burdens small employers who want to provide health insurance."
Higher Costs for Mid-Size, Large Businesses
Mid-sized businesses -- those with between 101 and 1,000 workers -- would have experienced a 9.5% increase in their total health care costs if the ACA had been fully implemented this year, according to the study. Meanwhile, firms with more than 1,000 employees would have seen a 4.3% increase in total health care costs.
The higher costs for mid-sized and large employers mostly can be attributed to the expanded coverage and increases in enrollment, according to the report.
The report noted that since mid-sized companies are less likely to offer health benefits than large firms, they would have to pay more penalties (Baker, "Healthwatch," The Hill, 10/8).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.