The impact of healthcare reform on Business

The impact of healthcare reform on Business

The recent passage of the healthcare reform legislation will have a significant impact on every type of business and while most of the concern is focused around the cost of providing healthcare and the associated cost and complexity of the types of plans and the new government sponsored plans there are some other changes that have been overlooked by many that from a business law perspective will result in a significant amount of new regulation and paperwork for small businesses that is not required today.

According to experts, generous health care packages make people more likely to get unnecessary tests and procedures. Health insurers must pay for those procedures, leading to an overall rise in health care costs. Many economists attribute the wage stagnation of great numbers of Americans to an increase in the costs of health care; taxing health benefits, they say, will eliminate much of the wasteful spending in the health care industry.

With reference to business law perspective, the act, signed into law by President Obama almost two years ago, requires individuals to carry health insurance by 2014 either in an employer or state-based pool. Opponents of the bill say this mandate is a gross overstatement of Congress' power, as it forces an individual to enter commerce that he or she should be free to opt out of. If Congress has the power to force an individual to purchase a good or service by virtue of interstate commerce, then what's next? Small business owners, some represented by the assembly going before the Court, also argue that the effects of this mandate could drive up their premiums and have dire consequences on their cash flow.

Proponents of the Affordable Care Act say that the uninsured or so-called “opted out” folks typically end up seeking medical care anyway, so opting out shouldn't be an option. When the uninsured seek medical care, they not only drive up the costs for the rest of the population, but the insured actually end paying for this expensive medical attention through taxes. In addition, the Act's stipulations provide for an environment where all individuals have access to affordable medical care through the state-based exchanges and small business SHOPs (Small Business Health Options Program). The collective influence of these group exchanges puts more bargaining power in the hands of consumers and small business owners and out of the hands of the record profit-making insurance companies.

Some business owners are seeing benefits from the changes that took effect in 2010 as a result of the Affordable Care Act and would like it to stay as law. They're differing opinions show that the assembly arguing the unconstitutionality of the Affordable Care Act doesn't represent the consensus of small business owners — because there isn't one. The projection of net gain or loss as a result of the Affordable Care Act's statutes is almost entirely dependent on an individual business's circumstances.

SHOP sets up exchanges that small businesses (less than 100) ...