Senate Democrats

Health Reform for Small Businesses

The current health care system is not sustainable for small businesses and their employees. According to a report from the Council of Economic Advisors, "Due to high broker fees, fixed administrative costs, and adverse selection, small businesses pay up to 18 percent more per worker than large firms for the same health insurance policy. Some of these higher costs are passed on to small firm employees in the form of lower wages, and some eat into the profits of small businesses that could otherwise be used for research and development and for much-needed investments."

Under the Patient Protection and Affordable Care Act small businesses will receive a number of key benefits, including:

  • Cost controls
  • Health insurance exchanges
  • Tax credits
  • Anti-discrimination reform

Small businesses will now enjoy the same leverage that big businesses have to buy coverage through a health insurance exchange. The exchange gives business owners greater buying power in the marketplace and spreads the cost of coverage across a much broader pool, helping to hold down premiums.