Small Businesses Eligible for Health Insurance Incentive

Only 43% of small business owners are familiar with a tax credit that could help pay their health insurance costs for employees, according to a national survey released last week by the Small Business Majority (SBM).

“I’m not surprised,” John Arensmeyer of the California chapter of the SBM said. “There has been a lot more heat than light shared on this law, so there’s been a lot of confusion.”

Arensmeyer has worked on a statewide “listening tour” for the past nine months, talking to small business owners about the creation of California’s health benefit exchange and the potential savings from the tax credit.

“People don’t really know for sure what’s in the bill,” Arensmeyer said. “Then when they see what’s in it, they’re pretty receptive to it.”

According to a different SBM study released last month, a lot of California businesses could use the tax credit that allows businesses to declare a tax credit of up to 35% of their health insurance costs beginning last year (if they have fewer than 25 employees with average annual wages under $50,000).

“What we’ve found in California was that 80% of businesses are eligible for the credit,” Arensmeyer said.

That’s why Arensmeyer has been traveling the state, he said, to see what people’s concerns are about the health reform law, and to make sure people understand what they might get out of it.

He said his organization is summarizing the results of the listening tour and will issue a report about it on Feb. 1. He also plans to do a survey specific to California right after that.

“We’ll be in the field in February or March,” he said, “and by early spring we’ll have some results.”