During a Committee meeting, Michael Beene, a senior health adviser for the National Association for the Self-Employed (NASE) shared that small businesses are ending up spending 5.5% of their total sales on health insurance. What’s worse: That figure has increased by almost 50% since 2005.
How is the Economy Effecting Insurance for Small Businesses Now?
“The escalation of health costs is most strongly felt by solo practitioners, who are spending more of their total sales on health insurance compared to three years ago,” Beene told lawmakers. “With such a large percentage of revenues going to health coverage, we can see why this expenditure is one of the first to be decreased or cut when business owners are faced with hard economic times.”
The way things stand right now, a sole proprietor cannot fully deduct their health insurance costs come tax time. Employees and business owners pay for their health care with pre-tax dollars, while a sole proprietor simply can’t do it. These self-employed business owners experience the 15.3% tax on their self-employed health insurance premiums.
There is a glaring inequality seen here, and it simply encourages employees to work for larger firms so they can easily have access to health insurance; it also encourages small business owners to withhold insurance, because they simply can’t afford to pay the taxes to provide it.
Will our country eventually begin pushing out small businesses, because employees are migrating to larger businesses who can provide health care? Will it eventually be small business owners standing alone against big corporations? I certainly hope not. This country was founded and built on the entrepreneurial spirit, and squashing it would be a great crime. Among all of the other things it is facing, this new administration needs to look at tax relief for small businesses so they can have health insurance not only for themselves but for the employees who help their businesses run.
So what options are available to small business owners even before changes in the structure take place? Doing your research and getting clear on what will and won’t work for your business is a crucial step in getting or maintaining your small business health insurance. You can also request a quote, right here, at Affordable-Health-Insurance.com
