Small Business Owners | Views On Health Coverage

SMALL BUSINESS OWNERS' VIEWS ON HEALTH COVERAGE AND COSTS

September 9, 2019

OVERVIEW

KEY TAKEAWAY

Despite a healthy economic period, rising health care costs represent a major burden for small-business owners. As a result, most are taking steps to cut costs and would look favorably on policy changes that would help curb the cost of providing health care coverage to employees. Their preferences are not ideological; policy prescriptions across the spectrum find favor. There is significant interest in banding together with other business owners to advocate for a different approach to health care.

BACKGROUND

The weight of health coverage and costs threatens the competitiveness of small businesses. To better understand employers’ perspectives on health care costs and to develop a targeted strategy for engaging and mobilizing to drive down costs and improve health outcomes, Public Private Strategies with support from Commonwealth Fund conducted a three-pronged research project featuring key informant interviews, focus groups, and a nationwide survey. 

KEY FINDINGS

Common themes emerged from this research that are aligned with anecdotal evidence and commonly held understandings and assumptions about the health care cost burden of small employers. Primarily, it is clear that health care costs are arguably the major concern for small businesses. Though small employers report taking steps to reduce the burden, often by shifting some of the costs onto their employees, few have considered dropping coverage altogether.

Increasing health care costs is not sustainable for small employers. They want change and are willing to take pragmatic steps. This desire for change does not adhere to party lines; across the ideological spectrum, small-business owners are open to a range of possible solutions. 

Small business owners are doing well in this economy and have optimistic outlooks.

The cost of providing health care to employees is the biggest problem for small businesses.

It’s a major problem across different types of businesses—newer, older, smaller, and larger. 

Small business owners have taken steps to lower their own health care costs.

This mostly results in passing costs onto employees through higher premiums and reduced coverage. 

Health care brokers have a massive impact on how small business owners choose their health plan. 

They are the most used and most helpful resource named. Younger small business owners also take advantage of the Affordable Care Act exchanges. 

Small business owners assign culpability for high health care costs to all major actors: 

Insurance companies, pharmaceutical companies, and the government. Pharma and insurance companies bear most blame. 

Small business owners want change. 

Both progressive and conservative policies receive support, owners welcome any chance for relief.

Small business owners want to advocate for this issue.

Particularly by joining with other small business owners to advocate for change. 

CONCLUSION

This research reaffirms what both policymakers and stakeholders know to be true: health care costs are taking a toll on small businesses in terms of money and time. Small-business owners often lack a human resources professional or the personnel enjoyed by their large competitors. They often make decisions quickly and then have to take more time down the road to adjust a health plan that has grown too costly to continue.

Small-business owners are taking steps to alleviate the problem. Unfortunately, without policy action their tools remain limited. They need support from policymakers to address the issue in a way that ensures they can continue to compete and employ millions of Americans in the future. For policy and lawmakers looking to support small employers, the time to act on health care is now.
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