There’s little doubt that the drama over the Affordable
Healthcare Act – "Obamacare” – will continue to play a major role in the U.S.
political landscape in the coming year. With that in mind, two major questions
loom over the discussion: Will the impact on small businesses be good or bad,
and just how big of an impact will there be?
Recently released surveys of individuals and small
businesses provide a glimpse of the future. For example, a survey
by Merchant Cash and Capital, a financing company for small businesses, says nearly
a third of respondents said they believe the health care law will hurt them,
mainly by increasing their operational expenses. Perhaps not surprisingly, given
the administration’s rocky rollout of the program, roughly 40 percent of small
businesses are still uncertain about how Obamacare will affect them.
Much of the uncertainty comes from a lack of clarity from
the government about a wide range of issues, including how to calculate the
number of full-time equivalent employees they have. Federal regulators say that
the hours worked by part-timers should be totaled and aggregated to determine
the number of full-time equivalent workers, but the government has been clumsy
at best (and totally ineffective at worst) in communicating that information to
small business owners. As a result, businesses are uncertain how to make sure
calculations are correct and whether they will pass the threshold that will
require them to offer health benefits as mandated in 2015.
Mark Lowenstein, marketing director for Merchant Cash and
Capital, recently told Inc.
magazine that the lack of communication is creating a ripple through the
business community. According to the survey, 1 in 5 businesses say they will
put new hiring on hold until the ramifications of Obamacare become clearer, and
1 in 4 say that, at least for now, they will halt any growth initiatives such
as opening new locations or expanding operations.
Another study recently released by the independent research
organization NORC at the University of Chicago certainly underscores the notion
of uncertainty. When 604 small businesses were asked if their insurers had
changed their benefit package because of the law, 34 percent said they weren’t
sure. Also, about 70 percent said they lack confidence that the government can
make any progress in shoring up the program’s weaknesses.
A survey by Public Opinion Strategies leans towards
pessimism, according to the Wall
Street Journal. In a poll of 400 business owners with between 40 and 500
employees (on behalf of the U.S. Chamber of Commerce and the International
Franchise Association), about 64 percent of small business franchise owners
believe the law will have a negative impact on their business. For
non-franchise businesses, the ratio was 53 percent negative and 12 percent
positive. Only 1 in 12 thought Obamacare would "help” their businesses.
In a column for Bloomberg
View, author and entrepreneur consultant Megan McArdle notes that
proponents of Obamacare have long said it will unleash a wave of
entrepreneurship, since people can start new businesses without the fear of
losing health insurance. However, she says, it could very well have the
opposite effect. For example, uncertainty could cause potential entrepreneurs
to "throw up their hands” and go back to corporate jobs where benefits are
Ultimately, McArdle says, there’s just not enough evidence
to gain a clear understanding of how the Affordable Care Act will ultimately
have on entrepreneurship and small businesses. And if the surveys are any
indication, she’s right: A good number of small business owners are uncertain,
skeptical, or just downright pessimistic.