Small Business and ObamaCare

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"Small Business and ObamaCare
A new survey shows that employers will drop coverage and cut hours.
Nov. 12, 2013 7:04 p.m. ET

One of Obama's proudest boasts about the Affordable Care Act is that it helps small business. The White House website says the health law "makes it easier for businesses to find better coverage options" and "stops insurance companies from taking advantage of you, giving the consumer and business owner more control and making health-care coverage more affordable." Small businesses aren't buying it.

That's the finding of a Public Opinion Strategies survey of more than 400 business owners with between 40 and 500 employees conducted in September and October for the U.S. Chamber of Commerce and International Franchise Association. Some 64% of small business franchise owners (such as owners of fast food and retail stores) believe the law will have a "negative impact" on their business, while only 5% expect a "positive impact." For non-franchise businesses the ratio was 53% negative and 12% positive. Only one in 12 agree with the President that the health-care law will "help" their business.

Even more problematic is how businesses are already responding to the new law. The White House continues to deny any relationship between hiring and ObamaCare. The poll finds 27% of franchise businesses and 12% of non-franchises have already replaced full-time with part-time employees in anticipation of the law's employer mandate. ObamaCare defines a full-time employee as someone who works 30 hours or more a week.

The survey also reveals that the "49er" effect is very real. These are businesses that will cap their full-time payroll workforce at 49 employees to avoid ObamaCare's insurance mandate for companies with more than 50 full-time equivalent workers. Of firms with between 40 and 70 employees, a little over half say they are likely to "make personnel decisions to keep" their "workforce below the threshold of 50 full-time employees and avoid the requirements and penalties associated with the new health care law."

More than one in four businesses (28%) say "...

My business does not need health insurance. Despite this

All businesses except for health care and health insurance business will be negatively impacted, that is specifically why we put the law in place. We as a society said that people were mis-allocating their purchases to these other non medical businesses and we made the ACA to make sure they were required to shop at these health care businesses.

Initially, on average, all other business have to do worse as people follow the law and shop at these firms less and spend more with their doctors (who were previously not paid enough in the market we had to run their businesses-obviously). In the mid and long term, businesses that either provide these health care services or insurances AND those that work for them (a new mandated privileged class, kinda like govt workers).

A wise and aggressive business planner would look at the data that indicates the types of purchases that health care workers and administrators tend to buy more and go into these fields, as they will be favored.

Remember, even though the law is immoral and generally wrong, any change in the law of the land provides others an opportunity to take advantage of the new rules and the unexpected and unnatural shift in the spending. Some will win from this, even some new players, probably some zucker type kid in his dorm room is figuring out how to scam us out of our next decade whilst others are wallowing in what will not change for some time.

In regards to business, the most negative impact is the unpredictiblity of future activity as a result of the ACA shaking the snow globe of the US economy. It is still being shaken, so who knows when things will stabilize. It is true that this law has an impact that goes way beyond health risk insurance, right down to impacting every spending decision you will ever make again - remember, all people are businesses, with one employee you cannot fire.

And less adult Americans are working now than any time since the late 1970's. Thank you Obama! Who is supposed to pay for this when people can't find good jobs?

That will simply be their problem.

Part of the new American rat race is to not be the guy that has to pay it.

People hording cash, trying to cash out now vs. later, perhaps not have kids so they don't suffer.

At least those that pushed for this the hardest will be the ones to pay for it the most - the young.

I think for most people (not that they will notice) what the ACA means to small business is.....that they will never own one.

OTN Good point. Why have a small business that has such onerous health insurance requirements. Either that or keep it a very small, small business.

My point was that they will not own one because people will be buying as they see fit less and less and have less to even do that with.

The ACA does NOT have any direct requirements of small business. Actually, I had to show my employees some form about the exchanges, that is it.

FYI, for me a small business has less than 10 employees (or so), in a small business, the owner knows all the employees, their family and their address and speaks with them almost every day they work.

I don't think the ACA has any requirements under 50 employees.

Again future business owners loose on the ACA because people will spend less. This does not mean small businesses don't have a high burden. For my <10 employees and the business, I fill out over 70 tax forms a year. I often want to give up, and eventually will.