ACA Insurance Tax Credits May Benefit Small Businesses

Cheryl Clark, for HealthLeaders Media , September 3, 2010

2. Small business premiums might also be reduced because the Secretary of Health and Human Services and individual states will establish processes to review insurers premium increases, and those insurers will be required to publicly justify unreasonable rate increases publicly.

3. Employees of small companies that don't offer coverage, and who can't buy their own health policies because of preexisting conditions, will be eligible for special new Preexisting Condition Plans (PCIPS). Employees must be uninsured for at least six months and be able to show that their health problem makes it difficult to obtain health insurance. These plans will operate until 2014 when they are replaced by state insurance exchanges.

In 2014, the following provisions will benefit small businesses and their employees.

1. Five million workers will gain health insurance or have coverage stabilized and improved through their employers when state health insurance exchanges take effect in 2014. Businesses with fewer than 50, or depending on the state, fewer than 100 employees can purchase employee plans through these exchanges.

2. While insurers currently can deny coverage or charge high premiums based on health status, by 2014, they will not be able to do so. Also in 2014, insurers participating in exchanges or selling insurance in the individual and small group markets will only be able to use certain factors to determine premiums, such as geographic region, age and tobacco use. Health status will no longer factor into premiums and coverage decisions.

3. Employees of small businesses that don't offer insurance will be able to buy policies through the exchanges. Those with annual incomes up to $88,000 for a family of four will be eligible for subsidies to help with premiums. And, Medicaid will be expanded to include everyone earning up to 133% of poverty level, currently $29,327 a year for a family of four.

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