‘HIT’ could stagger small businesses

March 07--NASHUA -- Scott Spradling, a former TV newsman who now runs a public relations firm with his wife, Tracy, remembers celebrating a couple of years ago when their monthly insurance premium hit $1,800.

As costly as that premium may seem for a couple with two teenage children, Spradling told a group of business leaders during a Wednesday roundtable discussion on health insurance, he was used to paying in excess of $2,000 in previous years.

"Broken," "horrified" and "budget-busting" were among the words tossed about the conference room in the Greater Nashua Chamber of Commerce's offices during the roughly one-hour discussion, which centered on the federal Health Insurance Tax (HIT) and what can be done to stop its implementation in 2020.

The tax, a provision embedded in the Affordable Care Act, commonly known as Obamacare, hits small businesses the hardest. This is mainly because a vast majority of them, too small to self-insure, purchase health insurance in the fully-insured marketplace -- and are therefore not exempt, as are larger companies that do self-insure, from the health insurance tax.

The attendees included representatives of the offices of U.S. Sens. Maggie Hassan and Jeanne Shaheen, and U.S. Reps. Annie Kuster and Chris Pappas, all D-N.H. They alternated between listening to participants' concerns and providing updates on the tax's status in Washington, D.C.

Small businesses, and by extension their insured employees, caught a break this year, the result of the passage in 2018 of a bipartisan bill that suspended the implementation of the tax for 2019.

However, small business owners, and their employees, are becoming increasingly concerned about the impact the tax will have on them if it is implemented as planned come 2020.

Greater Nashua Chamber of Commerce President and CEO Tracy Hall said Wednesday the tax would mean an additional $3,600 in health insurance premiums "right off the bat" for the small, six-employee agency.

"That's $3,600 in raises ... $3,600 investment in equipment that aren't going to happen," Hall said. The tax "really does impact the bottom line for small businesses."

Matt Mercier, founder of Acapella Technologies, a small, seven-employee firm in Manchester, said as much as he would like to cover his employees' health care premiums, doing so is challenging.

"I aspire to be able to provide health insurance for my people. But if (health insurers) keep moving the target, it's very difficult," Mercier said.

Bob Robbins, principal of the investment management firm Robbins Farley, noted many small companies are unable to afford any medical insurance "because we don't have low-cost alternatives" available.

"This is one piece of the ACA that was put in place ... there have been a lot of efforts to modify it," Robbins said. "There are many elements of the ACA that make it unaffordable for small companies."

At Nashua's Adult Learning Center, the agency covers a large percentage of health insurance premiums for its roughly 50 full-time employees, Finance Director Lisa Shadroui said.

And even with a comparatively generous benefits package, attracting new employees is still difficult.

"It's a benefit we provide that we don't want to mess with," Shadroui told the group. "The worst thing for us would be making our benefits package less attractive."

Should the tax be implemented in 2020, Shadroui pointed out, that cost would be in addition to any increases tacked on by the providers.

Such a significant jump would likely jeopardize the agency's ability to provide the amount, and quality, of services.

Mercier, noting he's "not a fan of the ACA," pointed to the insurance companies themselves as "one of the biggest problems in the health care industry.

It's a real problem. The whole system is broken," he said, calling the efforts to insure everyone, "just a Band Aid to make sure everyone has insurance so nobody falls into the abyss.

"It's all broken," Mercier said of the current system.

Dean Shalhoup may be reached at 594-1256, dshalhoup@nashuatelegraph.com, or @Telegraph_DeanS.

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