Health Reform Lowers Costs for Businesses
April 26, 2012
03:37 PM EST
You might have heard about a partisan report on how the health care law will affect some businesses across the country. We can’t speak to these individual anecdotes. But we know that analysts and experts have examined the law and concluded that the health care law will reduce costs for businesses. And we know we can’t afford to return to the broken health care system that was threatening businesses and families across the country and put insurance companies back in control.
Over the past decade, health insurance costs for employers who provide insurance to their workers increased by 113 percent. Losses due to productivity and absenteeism related to health are estimated to be more than $250 billion annually. America spends more than 17 percent of GDP on health care, far more than our competitor nations. Health reform will help reduce these costs and put businesses on a stronger financial footing.
In fact, countless experts have also examined the Affordable Care Act and found it includes major reforms that will help control health care costs. A team of economists including several Nobel Prize Winners wrote: “[T]he Affordable Care Act contains essentially every cost-containment provision policy analysts have considered effective in reducing the rate of medical spending.”
Here are some key facts to keep in mind if you’re reviewing the new report. Under the Affordable Care Act:
- Businesses Will Save Money: In 2014, small businesses, on average, could save up to $350 per family policy and many may be eligible for tax credits of up to 50 percent of their premiums. And according to an analysis of the law, all businesses will see lower premiums of $2,000 per family by 2019.
- Businesses Will Continue to Offer Coverage: Independent experts from Avalere Health, The Urban Institute, The RAND Corporation, and Mercer agree that businesses will continue to provide coverage to their workers after the health care law is implemented.
- Businesses Are Already Benefitting from Health Reform: Already, the law has helped businesses make health insurance more affordable through tax credits for small businesses, resources to help pay the high cost of early retirees’ care and new rules that hold insurance companies accountable for high premium hikes. For example, the small business tax credits will benefit an estimated two million workers who get their insurance from 360,000 small employers who will receive the credit for 2011.
- Two Years Into Implementation, Businesses are Creating Jobs: Congressional Republicans predicted that the Affordable Care Act would cause businesses to shed jobs. But in the two years since the law was enacted, the economy created 3.9 million private sector jobs.
- Medicare Remains Strong: Contrary to predictions from House Republicans, Medicare and Medicare Advantage remain strong. Since 2010, Medicare Advantage premiums have fallen by 16 percent on average and enrollment has risen by about 17 percent since this time last year. Just this week, the Medicare Trustees report was released, showing the positive impact of the law which extended the life of the Trust Fund by 8 years.
Some Republicans want to go back to the days when insurance companies could deny your coverage or jack up your rates whenever and however they pleased without any accountability. Republicans in Congress shouldn’t try to refight the fights of the last three years. Instead, both parties need to come together to create an America built to last where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.