The Unintended Consequences of Health Care Reform

So before my right-wing and left-wing friends think I’ve broken my oath to never publicize my political affiliations, let me make sure you understand right here that this is not a political piece.

Nope, this one is written by an HR pro who is grappling with understanding how all this Affordable Care Act rigamarole is supposed to work for our small-business clients.

Right now, I’m not sure the government understands the whole mess in its currently convoluted form, and while the carriers are trying to figure it out, they are also covering their fiscal derrieres, because it’s now morphed into a free-enterprise-yet-socialized system. Previously expensive rates are skyrocketing into bankruptcy-inducing territory.

We’re really proud to have clients who have always done the right thing and provided their employees and families with health coverage, even when the business probably couldn’t afford it.

We’re not talking about leviathan-size organizations. We’re talking about the backbone of this country, companies with 10, 20, 50, 75 employees who are making mortgage payments and paying for soccer and dance lessons for the vast majority of the population of this country—and wouldn’t dream of not providing health coverage.

Go back three or four years, and I can recall having conversations with business-owner clients about their 12 to 15 percent increases in health-care costs, while watching the color drain from their faces. But they still kept providing coverage—it was the right thing to do.

Fast-forward to today. From what I’ve seen of renewal numbers this year, we’re at 28 percent increases on the low end, and 55 percent increases on the high end. And this is a couple of years into this damn debacle after surviving the same type of increases just last year. And, invariably, these increases are for plans with lesser benefits.

Let me give you a few live examples.

A client gets a 55 percent increase in premiums, and thus switches to a plan that offers significantly fewer benefits for premiums that are still higher than before. Their rates are three times more than they were five years ago.

And the one that really broke my heart this week is a husband-and-wife client. The husband owns one business, the wife another. The law says that, because they are married, the businesses have to be combined for purposes of the ACA. This puts them over the threshold for many of the reporting and penalty pieces, but they wouldn’t be if their businesses were viewed as stand-alone. This awesome couple is seriously talking about divorcing for the sake of the health of their businesses—divorcing.

Look, call me a softie, but I do believe that care should be available to everyone. But I am witnessing, firsthand, what the inattention of our lawmakers is doing to screw up the small businesses of this nation.

It would be great if our warring politicians would step back for a minute and, rather than talking to lobbyists or protecting their derrieres from harm in the next election, talk to people who are navigating through this mess.