11 Million Small Business Employees to See Premiums Rise under Obamacare

In a Friday night document dump, along with the usual flotsam and jetsam of the administration came a bit of bad news for small business in America.

Nearly two thirds of small businesses who offer insurance to employees will see their premiums increase. That covers 11 million employees and their families. Since those costs to businesses are usually passed down to employees in the form of higher contributions, Obamacare will impose what amounts to a pay cut on millions of workers.


The premium increase comes on the heels of several years of skyrocketing health insurance costs for small businesses. The National Small Business Administration released a poll earlier this month that showed the average cost of health insurance per employee rising from $590 in 2009 to $1,121 in 2014.

And now — the hammer falls.

Washington Post:

CMS officials note that there is “a rather large degree of uncertainty associated” with their latest estimates, as the number of small businesses that offer health insurance going forward and how much they will pay for that coverage will depend on many more factors than the new rules analyzed in their report, including tax breaks for small firms and the success of new online insurance portals.

However, that didn’t stop critics of the law from casting the report as the latest in a long line of evidence that the statute will hurt more small businesses than it helps.

“The Obama administration has finally been forced to disclose what we’ve long feared — the president’s health care law means higher premiums for millions of American workers,” House Speaker John Boehner (R-Ohio) said in a statement about the report. “For all the promises of lower costs for small businesses, the administration now admits that far more of these workers will pay higher than lower premiums under the law.”

House Small Business Committee Chairman Sam Graves (R-Mo.) called it “devastating news” and blasted the administration for waiting nearly four years to publish estimates about the law’s effects on small-business insurance premiums.

In terms of its expected economic footprint, it has been a rough few weeks for the president’s signature law, commonly called Obamacare. First, the Congressional Budget Office reported that the law will prompt roughly 2 million people to exit the workforce, driving down the country’s economic output. And more recently, several states have reported that the law’s new online insurance marketplaces have not attracted many small businesses.


There is a great deal of uncertainty regarding just how much of an increase for small bussiness Obamacare will cost. Investors Business Daily believes the extra costs will be “significant”:

One study, for example, found that 63% of small employers in Wisconsin will see premiums jump 15% because of ObamaCare. A separate study found that 89% of small companies in Maine would see rate hikes of 12% on average.

Another, by consulting firm Oliver Wyman, concluded that ObamaCare would push up small group premiums nationwide 20%.

Will the president and Democrats admit to this lie?

In 2009, Obama promised small businesses that his plan would “make the coverage that you’re currently providing more affordable.” Later he said it would drive small-business premiums down by 4% in its first year, and as much as 25% by 2016.

As recently as last summer, Pelosi was proclaiming that “if you’re a small business … it lowers costs,” while Waxman said the law would make “high-quality healthy insurance more affordable and more widely available for small businesses.”

As with most everything else associated with this wretched law, the Republicans will be hard pressed to take advantage of the situation politically. The increases for small business employees won’t come until next year — after the mid terms. You can explain to voters how something is going to hurt them, but they usually have to actually get kicked in the face to get mad about it.


This is by design, of course, along with all the other delays. If the Democrats do manage to hang on to the Senate, it will be because they have been as dishonest about the Obamacare rollout as they were when passing it.


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