Whether you were for or against healthcare reform, it is difficult to have an informed debate. Hardly any of us understand the Patient Protection and Affordable Care Act, let alone have sufficient information to debate how it may impact our businesses in Oklahoma.
On the up side, more people are going to have access to healthcare. So in theory, hospitals and healthcare professionals will suffer fewer bad debts from uninsured or underinsured patients and the cost of services can come down. However, a cynic would suggest that costs won’t come down as much as the reduction in bad debts. And there’s still the problem of the substantial insurance premiums and provisions they set aside for medical malpractice suits.
On the down side, it doesn’t look great for most business owners. For those who already provide healthcare benefits to their employees, it looks likely that premiums will increase. It’s also likely to affect the taxes that business owners and employees pay – unfortunately not in a good way. As an example, for a business owner with 10 or fewer employees, there is an annual average salary cap of $25,000 for the 50% tax credit. And most small companies pay their staff more than $25,000 per year.
An annual tax credit also doesn’t help a company’s cash flow issues when you can only collect a tax credit annually. Cash flow is king, particularly in tough economic times.
Business owners want to comply with the laws of the land and most already provide their employees with the healthcare benefits they deserve. The biggest difficulty is going to be interpreting the new laws. I’m yet to find an expert who can tell me what it means to a privately held company in Oklahoma, but if I get any useful answers, I’ll be right back to you.
I’ve probably only referenced a couple of pages of the Act in this blog. The table of contents alone is 17 pages long. So, just another 2,390 pages to go. If I read ten pages a night, I might even be done by Christmas!