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Small, Mid-Market Firms Are Most Harmed by Healthcare Policies

It’s easy to make the case that the president’s sweeping overhaul of one-sixth of the U.S. economy has disadvantaged small and mid-market firms (SMBs) more than large companies, which can more easily absorb higher health insurance costs.

GettyImages-175445851-compressorIn fact, many small and mid-market companies have had to cancel their health insurance benefits completely as costs have risen under Obamacare. As a result, 56% of 2,500 businesses polled by LevelFunded Health said they’re losing quality employee candidates.

There are other ways Obamacare fails to address the health-coverage concerns of small and mid-market firms. For instance, only 181,000 small businesses claimed the Small Employer Health Insurance Tax Credit in 2014, according to the Government Accountability Office. This is just a fraction of the up to 4 million small companies estimated to be eligible for the tax break that covers a portion of their contributions to their workers’ health-insurance premiums. It turns out that the credit is too small and complicated for many small and midsized businesses to bother figuring out.

“Now large organizations are becoming blockers of innovation because they consistently aren’t looking to share information, and this is keeping smaller companies like ours from rolling out impactful solutions.”

Also, as the administration’s reworking of the healthcare economy continues to unfold, new ways in which its breadth, intrusiveness and foundational philosophy is disadvantaging SMBs continue to emerge. Take the electronic-records business, which is among the many slices of the medical economy that are being thrashed, in this case by legislation that predated Obamacare. Companies were offered $24 billion in potential incentives for adopting “meaningful use” of digital records. But most of the money went to big organizations.

The entire exercise has hurt an Austin, Texas-based patient-access, -engagement and –online-scheduling platform for health systems. “Now large organizations are becoming blockers of innovation because they consistently aren’t looking to share information,” says founder and CEO Puneet Maheshwari. “And this is keeping smaller companies like ours from rolling out impactful solutions—because we can’t integrate with underlying electronic health records,” he complains. “The structure of the incentives only benefited large organizations, and it’s made it more and more difficult to find clients who want to drive adoption of our platform.”

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