Imagine small businesses being able to provide a comprehensive health insurance package to their employees on par with any fortune 500 company.
While that may sound like a fantasy, we made that one step closer to reality with the Small Business Health Care Act.
The Small Business Health Care act would provide small businesses a cost-effective health insurance solution for themselves and their employees. It would give them the option to come together to form Association Health Plans, allowing them to be classified as one “large employer” for the purpose of offering health benefits to their members which will include numerous state and federal consumer protections.
There are 890,398 small businesses in our state, spanning all types of industries, and they employ 1.6 million of our hardworking neighbors. These businesses drive North Carolina’s economy and need all of the tools we can give them to compete in the free market with the mega-corporations that they are up against in today’s global economy.
And legislative Republicans have fostered that entrepreneurial spirit by instituting reforms since 2011 that have allowed small businesses to thrive in North Carolina. We have reduced the tax burden, reformed the tax code and strengthened our business climate -- empowering the private sector to create new jobs and drive down unemployment.
But despite all of that, health insurance is still a cost that many of our small businesses struggle with. While businesses with less than 51 employees are not required by law to offer health insurance benefits, studies show that a number of them choose not to offer coverage due to the steep costs.
This is because small businesses don’t enjoy the same advantages as large businesses when it comes to offering health benefits to their employees. Unlike a massive corporation such as Microsoft which has an enormous insurance pool to drive down their costs, a small internet startup may only have a pool of 10 or 15 employees. That’s where the Small Business Health Care Act comes in.
Association Health Plans are not a new idea. In fact, they have existed for decades and are permitted under current law for certain types of employer groups. But because of the Obama administration’s efforts to prop up Obamacare’s small group and individual markets, most Association Health Plans were effectively dismantled in 2011.
The Small Business Health Care Act will take advantage of loosened regulations by the Trump administration to expand freedom to Association Health Plans and once again make them a viable option for many small businesses. The bill will not only allow businesses from different industries to come together in an Association Health Plan, but will also allow sole proprietors to join, a provision that was previously prohibited under both state and federal law.
This bill would open up a world of new options for North Carolina’s small businesses. Chambers of commerce, credit unions, trade organizations: All of them would be able to offer affordable health insurance to their members. Sole proprietors like real estate agents, plumbers and carpenters could band together to get group health insurance for themselves and their families. According to the nonpartisan Congressional Budget Office, these changes could potentially benefit up to 110,000 North Carolinians.
We have done so much to give North Carolina small businesses the chance to succeed over the past eight years, and it’s high time that we put them on a more level playing field with large companies when it comes to health insurance coverage.
Sen. Joyce Krawiec (R-Forsyth) and Sen. Dan Bishop (R-Mecklenburg) are the N.C. Senate Health Care Committee chairs.