Knapp: What you won’t hear in S.C. Senate: How Obamacare will save my business $7,500

The State
March 12, 2014

By Frank Knapp Jr., Guest Columnist

Columbia, SC — Between the Republican Governors Association’s TV ad criticizing likely Democratic gubernatorial candidate Sen. Vincent Sheheen and the debate inside the state Senate on a bill to outlaw much of the state’s participation in Obamacare, it would be easy to believe that the health-care reform is hurting S.C. families.

Fortunately, there is little evidence of that, and my own experience is that the law has and will save my small family business thousands of dollars on health insurance.

This is what the S.C. Small Business Chamber of Commerce expected when we worked for passage of the Affordable Care Act, which does not mandate that businesses with fewer than 50 employees provide group health insurance but does give tax credits to most businesses with fewer than 25 employees that offer insurance as an employee benefit.

Our business had traditional group health insurance for its owners and two full-time employees. Last year, the business paid the full premiums, and we qualified for a tax credit under the health-care law. Thus, Obamacare already saved our business money on our 2013 taxes.

And now the new health-insurance marketplace has opened up even more ways for us to save money. Our business fully explored the options and will save $7,500 in the next 12 months while still covering all the premiums for high-quality health insurance for the same employees and owners.

Most small businesses currently offering health insurance to employees also can save money. Just follow these steps.

First, use an independent insurance broker or agent. While health-insurance navigators and certified application consultants can provide valuable assistance for individuals purchasing coverage through the marketplace, businesses need to use broker/agents.

Second, gather information. You will need all the information on employees and dependents (including total family incomes), current policy benefits and premiums you now pay.

Third, shop. While the online application function for small businesses will not be available until 2015, small businesses still can obtain group rates through the marketplace using the mail, broker/agents and insurance company websites.

Fourth, explore individual plans, and be prepared to drop a group plan in favor of individual employee policies. If your employees are eligible for the advanced tax credits, or premium assistance, you might see a dramatic reduction in actual premium payments.

Fifth, talk to your certified public accountant or tax preparer.

This process takes time, but it is well worth it.

Our business will save more by dropping the group health plan (and the business tax credits) in favor of individual plans through the marketplace for the two employees and off the marketplace for the owners. Both employees qualified for significant federal premium assistance. The business will essentially still pay all the premiums by increasing the pay for the employees to cover the premiums and additional income and Social Security taxes owned.

So while the political ads created by people who probably never created a job seek to influence your opinion and state legislators try to throw up obstacles to making it work, the Obamacare I know offers exactly what small businesses wanted: more affordable, high-quality health insurance.

Mr. Knapp is the president and CEO of the S.C. Small Business Chamber of Commerce; contact him at
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