Just over a year ago, President Obama signed into law the Patient Protection and Affordable Care Act (aka health care reform). However, while millions of Americans, particularly children and young people under 26, now have health insurance, studies show that many of the small businesses in California are unaware of the provisions made available to them to help provide health insurance to their employees.
Under health care reform, small businesses with up to 25 employees can qualify for a tax credit of up to 35% to offset the cost of health insurance. This credit increases to 50% in 2014. Beginning in 2012, small businesses with fewer than 100 employees will be able to shop for health insurance under the health care exchange. In fact, it is estimated that four out of five small businesses in the state currently are eligible to receive the tax credits.
Yet, according to a Pacific Community Ventures survey of 800 California businesses with 20 or fewer employees, 57 percent of small businesses are unaware of the available tax credits and 62 percent have not heard of the health benefit exchange California is establishing. Similarly, a 2011 survey conducted by Small Business California found that 53% of small businesses were unaware of the tax credit.
Lack of awareness is unfortunate as there are about 500,000 small businesses eligible to get help from the federal government to provide health insurance to their employees. And once informed of the provisions, employers are interested in offering it. An example is Janna Rodriguez, the owner of J&R Tacos in Merced with 8 part-time employees. She told the Modesto Bee that:
“We definitely want to keep them around and healthy as much as we can. I always try to treat my employees as part of the company and not just as somebody who works there. We are all growing together. I would be more than happy to be able to provide insurance for them."
Sounds like an awareness campaign is in order.
For more information on benefits for small businesses under health care reform, go to: www.healthcare.gov