Colorado’s Single-Payer Bill: A Healthcare Solution for Small Businesses
- Small business owners struggle with the cost and complexity of providing health insurance to their employees, particularly businesses with under 50 employees. Rising premiums, complicated tax rules, and government incentives can make the process challenging and costly.
- The National Federation of Independent Businesses conducted a survey, revealing that 98% of small businesses offering health insurance are concerned that the costs will become unsustainable within the next 5-10 years. This makes attracting and retaining talent a challenge for small businesses.
- HB24-1075, a legislation being considered in Colorado, could offer a solution by authorizing an analysis of how a universal single-payer payment system might work for the state. Under this system, instead of paying premiums to multiple for-profit insurers, Coloradans would pay a premium to a single non-profit entity, which would then pay care providers directly. This could potentially simplify the insurance process and make healthcare costs more manageable for small businesses.
Challenges Faced by Small Business Owners in Purchasing Health Insurance
Procuring health insurance for employees is a major challenge for small business owners, especially when their employees number less than 50. Decisions on plan selection, contribution amounts from both company and employees, and whether to offer individual or family plans are all difficult and have financial implications.
Impact on Small Businesses
Every decision affects profitability, hiring, and investment. Brokers’ commission for small businesses further increases costs. With the rise in premiums particularly due to inflation, it’s becoming even harder for small businesses to afford health insurance.
Survey Results on Health Insurance Concerns
A recent study by the National Federation of Independent Businesses reveals serious concerns about health insurance costs. Surging premiums might soon make it unaffordable for small businesses to offer health insurance to employees.
Risks for Small Business Owners
Small business owners are caught in a bind. On one hand, if they don’t offer health insurance, they risk increased sick leave, turnover, and employee dissatisfaction. On the other hand, offering insurance means dealing with rising premiums, complex tax rules, and difficult-to-understand government incentives.
Health Insurance Costs for 2022
According to Value Penguin with Lending Tree, in 2022, employers paid an average of $6,584 for single workers and $16,357 for families in annual health insurance costs. This translates to significant expenses for small businesses, especially those just below the ACA requirements.
Potential Solutions and Legislation
For businesses with fewer than 25 employees, the Small Business Health Options Program (SHOP) could be a solution, but there are eligibility restrictions. A proposed legislation, “Analysis of Universal Health-Care Payment System” (HB24-1075), could offer a potential solution. It would authorize the Colorado School of Public Health to analyze the implications of a universal single-payer payment platform for Coloradans.
Benefits of a Single-payer Payment Platform
The proposal suggests a system where every Coloradan would pay a premium, based on their ability to pay, to a single non-profit, publicly financed entity. This entity would then pay for medical services directly to private providers. The simplification of the system could be beneficial for healthcare providers, Coloradans, and small business owners alike.
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