This is the first question that many small business owners ask the insurance agent or broker. The new healthcare reform law is very complex, and its impact on small businesses depends on the average number of full-time employees, average employee annual wages, and other factors. Whether or not reform will increase or decrease insurance cost is subject to much debate and yet to be determined, but some of the major provisions include:
No lifetime limits on coverage — Insurance issuers may not establish lifetime limits on the dollar value of benefits. Prior to 2014, providers may impose a "restricted annual limit." The current annual limit minimum is $750,000. The annual limit minimum rose to $1.25 million on Sept. 23, 2011, and will increase to $2 million on Sept. 23, 2012. Annual limits on coverage will be prohibited beginning in 2014.
An end to pre-existing conditions — Health insurers cannot deny children health insurance because of pre-existing conditions. A ban on discrimination for adults will take effect in 2014.
Small business tax credits — Depending on the number of employees and average wage scale, your business could be eligible for a tax credit up to 35 % of the company's share of healthcare costs.
Expanded child coverage — Dependent coverage of children must be made available for an unmarried child until the child turns 26.
No lifetime caps — Lifetime caps on the amount of insurance an individual can have will be banned. Annual caps will be limited and banned in 2014.
These are just a few ways in which small businesses in general will be affected by healthcare reform. For more information on the specific ramifications of your business, contact RD Parisi Associates.