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Jun 25 2014
Affordable Care Act: Effects on Small Businesses
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Thinking about the intent of the Affordable Care Act, it would seem that providing health insurance to all Americans would benefit small business owners. The rationale seemed simple: instead of losing an ongoing battle with large employers who have more covered lives to negotiate lower premiums, health reform would create a level playing field and provide the ability for all Americans to access affordable health care.

But as I talk with small business owners, they still aren’t sure what to think of health reform. Some say they hear their group health premiums will nearly double next year as insurance carriers take advantage of new underwriting rules. Others report that reform appears to be working and their overall health care costs are remaining close to last year.

A lot depends on how many full-time equivalent employees, or FTEs, the business has. There are separate rules and tax implications for those with fewer than 50 FTEs, those with 50 to 99 FTEs, and those with 100 to 199 FTEs. For some, just proving the number of FTEs added unexpected cost and complexity.

Holy Family Memorial has a different focus in supporting small businesses navigating these changes. At its core, the Affordable Care Act supports what we have focused on for over a decade, providing the right care, in the right setting at the right time to our patients. In order to do that, barriers to care such as a lack of health insurance, which can prevent individuals from seeing providers and waiting until their issue is an emergency, must be removed. The costs incurred from the uninsured are reflected in premiums by individuals and organizations who purchase insurance. So while small businesses work to determine if they need to provide coverage and at what level, we focus on ensuring costs remain stable not only for your employees, but also for the marketplace. Our focus is on how you use healthcare; we work with patients to avoid the most expensive services while getting the results needed to achieve healthier lives.

We understand that’s a different perspective than focusing solely on the bottom line as many businesses – both small and large – tend to do when it comes to health care. The problem is that health care costs aren’t as simple to compare as consumer goods, especially when looking at the cost of a single procedure. Firms that make insurance decisions based on a handful of cost comparisons aren’t looking at health care the same way we are.

We’ve worked hard to reduce hospital utilization, which we know reduces overall health care costs to the community. We estimate that if all patients had used Holy Family Memorial from 2001 to 2011, it would have saved the community roughly $28 million in total unadjusted gross charges by keeping people out of the hospital, helping patients avoid surgeries and increasing preventive health efforts. It is with our continued focus on the “Right Care” that will ultimately support local businesses as we move into this new era of health care reform in America.


Mark P. Herzog, FACHE, is President and CEO of Holy Family Memorial. He can be reached at mherzog@hfmhealth.org.


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