Last week, the U.S. Supreme Court heard six hours of oral arguments for and against the constitutionality of the new health care law. As a small business owner, I am not a constitutional scholar, but I can definitively say this: the Affordable Care Act is cutting my health care costs and helping my business.
My wife and I run an auto repair shop in Columbia, MD. We started as a small, family-business in 1978. Now, we’re a well-respected business with 19 employees, a long string of awards and a reputation for service.
One of the biggest barriers to growing a successful business has been the rising cost of health insurance. We’re committed to offering insurance coverage, but over the past 10 years it has become a real struggle to keep up with the costs.
We’ve become accustomed to rates going up 10 percent to 20 percent each year (sometimes even more), and we’ve had to look at many different ways to deal with the extra expense. We’ve got a great agent who does a lot of research and works hard to find the best options for us. But in the end, we’re the ones who have to decide what to do — and foot the bill.
We renew our insurance in August every year, so around June is when I usually start to get nervous. Last year, we heard a lot of speculation about how rates were going to go up even more because of health care reform. I was worried about the sticker shock, and what we might have to do to our insurance — like cut way back on the benefits — to continue affording it.
When we sat down with our agent at the end of July, I was bracing myself for the bad news. But when he pulled out our quotes, my worry turned to disbelief. The “bad” news: Our rates were going down 6 percent! I almost fell off my chair.
We had no major changes in our small group, the same average age as the year before, the same policy. On top of that, our agent told us that we’d also be gaining access to more preventive care, with no deductibles.
Premiums going down? This had never happened before in all the years we’ve been offering health coverage. We’d been getting squeezed by escalating health insurance costs all that time.
The first thing we asked was, “why?” We just couldn’t make sense of it.
Our agent explained that our rate correction was thanks to the “medical loss ratio” requirement in the Affordable Care Act — a piece of the law that requires insurance companies to spend at least 80 percent of the premiums they collect on actual health care costs, as opposed to CEO salaries, advertising and administration.
As a small business owner, I take customer value seriously. I know it’s what makes or breaks a successful small business. We’re committed to providing good value to our customers. It seems only fair that we should be able to expect the same from our health insurance companies, and now, thanks to the 80/20 value for premiums rule, we can.
We are so glad that something has been done about health care and that we’re already seeing some real savings from the Affordable Care Act. But now, with the shadow of the court challenge hanging over our head, we have something new to worry about: Are these savings here to stay, or will they be yanked away before we even get to our next renewal?
I’ve been dismayed to hear that one of the groups arguing against the health care law before the Supreme Court is a group that claims to represent the best interests of small businesses. This group certainly doesn’t represent me, and I hope it doesn’t get its way.
The health care law is already working for my business. It passes my inspection test with flying colors. There’s no good reason to take it off the road.
Brian England and his wife Jennifer own British American Auto Care in Columbia. Mr. England is a small business leader in the national Main Street Alliance network, which has filed a “friend of the court” brief to the U.S. Supreme Court presenting a small business case for upholding the Affordable Care Act. His email is beengland [at] comcast.net. This post was first published in The Baltimore Sun on Sunday, April 1st 2012.
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it always amazed me how little attention business owners would give to their health insurance cost. For many it is the 3rd or 4th biggest expense they have. Yet they deal with it once a year in June and don’t give it a moments attention the rest of the year. Until renewal then they are surprised an unmanaged expense went up.
Why didn’t you do something 10 years ago to find out what your loss ratio was and make sure it was in line?
My rates went up 43% this year on a $2500 deductible plan. My agent says it’s mostly because of Obamacare, “free” preventive care, Ms. Flucks birth control (whether oral or surgical), reaching 20 employees, loss of grandfathered status, new administrative requirements like the addendum to new business input documents required for health care reform compliance and collecting data like how much all the employees make each year from their job at this company, their other jobs, and what everyone else in their household makes, so they are prepare to report this to the current IRS employees and the 4000 new agent the IRS hired to get up into everybody’s business, removal of any caps on anything, everyone getting a year older, the carriers deciding since they are now going to be handcuffed in most areas they once had flexibility when it came to rating, now going right to the maximum rates allowable by law so they arrive just at 80% MLR, cut all management of care and customer service including his commissions, and instead put 20% of premiums in the CEO’s pocket, until all private health insurance companies go out of business. Oh yeah, and giving you a 6% decrease. This PPACA is the greatest thing since anecdotal outliers and sarcasm.
Good comment, in the aggregate.