I’m sure by now there are but a few people in the entire country who haven’t heard that the health care bill passed in Congress and was signed by President Obama. In fact the people who haven’t heard about it are likely the people who will benefit the most as they are the uninsured.
As the clients of Silkin Management Group are all small businesses and, as a consultant for Silkin Management Group, I was looking for a good comprehensive summary of how the bill will affect most small businesses in the country. I found this article on “CNN Money.com for Small Business” and think it is a fairly easy to read and understandable summary of the bill and its impact on small business. You can link to the article here: What health care reform means for your business
The article points out that the bill will only very marginally decrease insurance costs for small businesses – between 1% and 4%. That’s nice but certainly no great shakes.
Another key point is that starting in 2014, if you have more than 50 employees, you will be mandated to have health insurance for all employees or pay a $750 penalty per year, per worker. There’s a couple of things I suspect could happen: a) since premiums are more than likely much greater than $750 per year per employee, I think you’ll find most businesses of this size paying the penalty due to that being a lower cost way to go, and b) any business that is nearing 50 employees will likely not be in any sort of hiring mode in order to avoid this cost. That’s certainly not a smart way to incentivize business growth.
As we teach our clients at Silkin Management Group: if you reward production you are more likely to get increased production, but if you penalize production/growth, you will very likely not get any increase in productivity. I think most business people have an innate sense of this basic management rule. Unfortunately the people who make many of the laws that affect business have no business experience and/or innate sense of what works in the management of a business. The above noted “de-incentive” is certainly a sign of this.
There are many more areas in which the health care bill impinges on small businesses and the article noted above provides a good overview of these areas. I am suggesting to my Silkin clients to read through it and recommend it to anyone reading this blog.
Jack Hennessy
Consultant for Silkin Management Group
If you’d like to find out more about Silkin Management Group and its services, contact us at: info@silkinmanagementgroup.com or call 800-695-0257. You can also visit our website at www.silkinmanagementgroup.com
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