What the healthcare bill means for small businesses | Hacker News Reader

What the healthcare bill means for small businesses

blogs.reuters.com

14 pointsstartuprules7 comments

Seriously, with no exclusions for pre-existing conditions, no raising of rates if you get sick, and no lifetime maximums - how are "insurance" rates not going to rise?

This smells like a "let's bankrupt all the private insurers" and then let government swoop in and finally nationalize the rest of the healthcare system to fill the void.

Theoretically the insurance rates won't rise because the healthy young people who aren't buying insurance now will be forced to do so legally. With a lower risk pool, the insurer would hopefully be able to keep rates stable.

How many healthy uninsured young people do you really think there is?

I hear 36 million total uninsured getting thrown around.

Let's say 15% are healthy, young, & gainfully employed (able to afford premiums), but until now - health insurance "scofflaws".

Do you really think these 5.4M people offset uncapped, unrestricted benefits of the other 300+ Million people?

Change the rules and people will behave accordingly. The most obvious effect I foresee is that employers who can't afford insurance will try to avoid growing to have 50 employees. This isn't because the employer is evil, it's because that one extra employee will cost salary + $40k in penalties, and probably get him labelled as an exploiter of the working class. That should do wonders for the economy.

It'll be interesting to see whether the negative impact of employers trying to stay below 50 FTE employees is offset by the positive impact of people feeling more free to start or join small businesses that don't yet offer health coverage because they don't have to worry about pre-existing conditions when obtaining individual coverage. It's not an obvious calculation either way.

"Change the rules and people will behave accordingly"

Very true. Do you know of any provisions (loopholes) for determining which organization actually employs the workers? Where do employees end and contractors begin? Couldn't organizations exist that simply contact out <50 employees to companies?

Lets say I run a manufacturing business that requires 70 people to operate at target capacity. Couldn't I employ 35 workers, and then contract out the other 35 employees to a separate company (also owned by me, or maybe contracted through a staffing firm), so that each organization stays under the 50 employee limit?

50 employees isn't that special of a number, because you also have to have 30 of those employees buy subsidized health insurance from the state marketplace. Even then you only pay the 2k penalty for each person above that.

If you have 80 employees and 40 get the subsidy your total penalty is 20k. If your annual payroll is $4,000,000, $50k per employee, this is .5% of your payroll

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