Instead of supporting this type of innovative growth, the president’s health care law stifles it. The employer mandate — requiring employers with 50-plus employees to comply with expensive requirements — was long planned, left unexplained, then delayed. Many companies endured chaos as Washington contorted. Small business owners, always hit harder with the cost of compliance, don’t know what will hit them next.
Now business leaders are discovering a new provision, hidden as a “fee” on health care insurers. This is a tax that will be passed straight onto small businesses and their employees. The small business community calls it the health insurance tax, or HIT, for good reason — this is essentially a tax on Main Street USA. The added cost doesn’t affect big businesses; they self-insure their employees. The HIT only hits the health-insurance marketplace, where most small businesses and the self-employed purchase their health care plans.
The HIT charged to health-insurance companies will be passed on to small business. In turn, those companies, with typically slim profit margins, will pass the HIT on to employees. Since small businesses employ two-thirds of all the US workforce, most Americans will pay the bill. Families will pay up to $500 more each year beginning in 2014. The tax will actually increase over time, causing a greater burden in the years to come.
If you work for a small business, it’s time to “wake up” and realize these taxes will affect you. If you own a small business, you need to make sure your employees know about this tax and understand that the cost will be passed along.