Kitchen Table Economics

Expand Choice and Reduce Health Care Costs for Small Businesses Screenshot

According to a recent poll from the Job Creators Network, 77 percent of small business owners are concerned about rising health care costs. It’s not a surprise since the cost of health care has increased by double digits almost every year since the passage of the Affordable Care Act during the early years of the Obama Administration.

Small businesses are particularly burdened by these skyrocketing prices because their budgets are often more strained than larger, more established corporations. The results have been devastating. The number of small businesses that provide health coverage for their employees dropped by one-third between 2008 and 2015.

In response, the current administration has directed the Department of Labor to expand what are called association health plans. This change would essentially allow small businesses to join together in order to negotiate for better and cheaper health care. You see, as a group looking to attain health coverage becomes bigger, health insurance providers are more likely to reduce rates because they gain a bigger customer base.

The implementation of this new policy is expected to be announced in the coming weeks. Small businesses and their employees will be all the better for it.