Small businesses struggle to provide health insurance

Small business owners in Ohio seem to be growing more concerned about rising health care costs.

A new report from the National Federation of Independent Business showed the small-group insurance market as a way for small businesses to provide health coverage for employees is becoming more unsustainable for both businesses and employees.

"Ohio's small business owners have reported health insurance costs as their number one concern for nearly four decades," said Chris Ferruso, state director for NFIB Ohio. "Despite being well-intentioned, legislators should resist pursuing health insurance mandates as it ultimately puts pressure on health insurance premiums and forces small employers to decide whether they can afford to provide this employee benefit."

NFIB's Address the Health Insurance Affordability Crisis for Small Businesses report showed enrollment in the small-group market has fallen 44% between 2014 and 2023, going from 15 million people to 8.5 million.

Also, the average single plan premium jumped 120% in the last 20 years, and family plans have risen 129% over the same time for businesses with 50 or fewer employees.

The number of small businesses that offer health insurance has been cut nearly in half since 2000, and businesses with less than $600,000 in revenue pay nearly twice (measured as a percentage of payroll) as much for insurance than companies with more than $2.4 million in revenues.

Ferruso pointed to two bills in the Ohio Legislature as keys to providing relief.

One would give employers with 50 or fewer employees a tax credit of up to $400 per employee to provide Individual Coverage Healthcare Reimbursement Arrangement.

The second would allow employers who buy a group health plan for employees to get a refundable tax credit for part of the premiums paid.

"Larger businesses are typically exempt from state-imposed health insurance mandates under the federal ERISA law, leaving small businesses with skyrocketing costs. We encourage Ohio policymakers to make health care more affordable for all," Ferruso said.