The Myths about Obamacare and Small Business

The opposition to the Patient Protection and Affordable Care Act (PPACA) often falls back on the argument that says health care reform will hurt small businesses. However, according to a CNN Money article, new research indicates that this argument is overblown and only a tiny fraction of businesses will be affected by the 2014 provisions.

Out of 5.9 million small businesses, defined as businesses below 500 employees, 97% have below fifty full-time employees; therefore, healthcare reform only affects 3% of small business, or 200,000 companies. Out of those 200,000 companies, 97% already offer insurance. Although detractors claim that their insurance policies could still be penalized, new research from the University of Chicago says that more than 99% of the existing insurance policies will be acceptable under the PPACA.

All told, that leaves a tiny fraction of small businesses that will have to change their policies under health care reform. So while it may be tricky for these few companies, to say that Obamacare will harm small business is a stretch.