Small Business Health Insurance on the Decline

By: Lindsay Wissman (Zane Benefits) August 2016

When the Affordable Care Act (ACA) passed, many people feared that businesses Small Business Health Insurance on the Decline would choose to stop offering health insurance and pay the penalty instead. As a result, many surveys have been conducted to determine the impact of the ACA on small business health insurance, as well as offerings made by large companies. In July 2016, the Employee Benefit Research Institute revealed findings from its latest study.

By the Numbers: What is Happening to Small Business Health Insurance?

When discussing the impact of the ACA on employer-sponsored health insurance, it is important to differentiate between large and small businesses. The law requires large businesses (companies with 50 or more full time equivalent [FTE] employees) to offer health insurance. If they choose not to comply, they will be forced to pay a penalty. The ACA exempts small businesses (fewer than 50 FTE employees) from this requirement.

Since the implementation of the ACA, health insurance offer rates have generally remained steady among large employers. Companies with more than 1,000 employees are offering health insurance at a rate of 99 percent. Companies with 100 – 999 employees are not far behind, ranging from 92.5 to 95.1 percent.

Among small employers, however, the numbers tell a different story. In each size category studied, small business health insurance offerings have been steadily declining since the start of the recession… Continue to Zane Benefits