By Chip Rogers, AAHOA President & CEO
In the seven years since the Affordable Care Act (Obamacare) became law, the number of Americans without health coverage has fallen slowly but steadily. In late 2014, five independent polls showed that over a 15-month period, the percentage of uninsured Americans had dropped an average of 4.2 points. And as recently as last February, TIME estimated that approximately 90 percent of all Americans were covered.
The bill’s proponents have been quick to point to these and other numbers as proof that the system is working, but the American middle class and its thousands of small business owners know otherwise. Obamacare has not been an abject failure, as some conservatives claim, but neither has it been much of a success – far from it. In fact, the rising number of insured Americans is the result not so much of sudden affordability as the bill’s provision mandating that every American have health insurance. Skyrocketing deductibles and other out-of-pocket costs have made actually using the insurance out of the question for many low- and middle-income earners.
The United States is in need of comprehensive healthcare reform – again – and President-elect Donald J. Trump has vowed to tackle Obamacare head-on once inaugurated. The question, however, is whether he will pursue a full repeal (as he has repeatedly pledged to do) or allow leading Republicans in Congress (and newly appointed Secretary of Health and Human Services Rep. Tom Price) to make tweaks that do away with the law’s undesirable components.
In either case, business owners may have reason to be optimistic. Although some of Obamacare’s more popular components (like extending coverage to adult dependents up to age 26) are likely here to stay, it’s safe to assume that healthcare under President Trump will shift decisively toward business-friendly, free-market policies that incentivize, rather than subsidize, individual enrollment and provider participation.
First, under Obamacare, businesses with more than 50 employees are obligated to offer health insurance – or pay a staggering $2,000-per-employee fine. But it also encourages those businesses to self-finance that health insurance, which places all risk on the owner. As the Brookings Institution’s Robert C. Pozen puts it, “One big claim can wipe out a small company. ”To ease that burden, it is probable that Trump will raise the employee threshold from 50 to at least 100 – meaning that only well-developed businesses (i.e., those that can afford it) will be expected to offer coverage.
Second, the current system both mandates coverage and offers heavy subsidies to help pay for it. Any plausible Republican-backed healthcare plan is likely to eliminate both, replacing them with tax incentives for Americans who opt to purchase insurance on their own.
Third, and finally, Obamacare infamously lowered the full-time employees’ status threshold to 30 hours per week. This has created considerable uncertainty among American employers and made it difficult to maintain a consistent workforce or hire new staff. With a Republican president and majority in Congress, the 30-hour work week is on its way out.
The new president’s administration is slowly coming together, with key cabinet positions going to business leaders with decades of combined experience at the helm of some of the world’s best-known organizations. Let’s hope that American healthcare, like so many other threads of the national fabric desperately in need of a common-sense overhaul, will soon reap the benefits of entrepreneurial-minded leadership in the White House.