While there was considerable speculation in the last few years that many small businesses would alter their approaches to the ways in which they covered their workers once the major mandates as part of the Affordable Care Act went into effect at the start of 2014, new data suggests most won't change much when it comes to extending these benefits.
In a new poll of small business owners, nearly seven in 10 now say that they will definitely continue to cover their full-time workers' health insurance coverage, up from just 46 percent who felt the same way last year, according to the International Foundation of Employee Benefit Plans. In addition, one-quarter say that they're very likely to do so, while another 4 percent are somewhat likely. Only 1 percent definitely will not continue to cover them.
This change is coming even as a large and growing number are expecting to see substantial costs as a result of their compliance with the federal law, the report said. For instance, more than four in 10 say that their health insurance costs will rise by 5 percent or more, up from slightly less than three in 10 last year. Further, the proportion of companies that expect to see no change, or even a drop in costs, has dwindled somewhat, to 12 percent this year from 15 percent in 2012.
The compliance will, however, likely have some negative changes for the companies even beyond their costs, the report said. In all, one in five businesses with between zero and 50 employees plan to reduce hiring as a means of staying under the ACA's threshold of insuring all full-time workers once they have more than 50, and the same number will also adjust the hours their employees work so that they're not eligible for coverage. Another 17 percent of companies will also lay off some current workers to get under those obligations.
As another means of cutting costs, nearly one in five has implemented a wellness program designed to make employees healthier, and another one-quarter say they will do so in the next 12 months, the report said. Many of those companies have also created associated incentive programs.
Each business will have to do what is best for them as a means of achieving ACA compliance, meaning executives and owners will have to make important decisions before the start of the new year to do so.