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article imageHow will Obamacare affect businesses in the next decade?

Although there have been a large number of reports citing the negative consequences of Obamacare, the program seems to be finally getting on track.
For individuals and businesses, it will take several years to determine if the reform was a success or failure. It could be up to a decade for Obamacare to take hold, settle down, and for Americans to experience some of the intended benefits of the legislation.
However, as experts like employee industry veteran Frank Keasler have observed, the country has already experienced some of the effects of Obamacare.
As Keasler advises, “It’s important for the American public to be educated on the Affordable Care Act, and understand fully how it will impact their benefits moving forward.”
When enrollment for the ACA commenced, Americans were surprised to receive notifications that their health insurance plans were canceled because they did not meet the requisites of Obamacare, despite President Obama promising on several occasions that “if you like your health plan, you can keep it.”
Aside from that, there have been other significant issues affecting Obamacare. For instance, the President promised during his first term that his health reform plan would reduce premiums for the typical family by $2,500, but instead they shot up by an average of $3,065. With Obamacare implemented, health plan premiums are soaring, according to a study of 148 insurance brokers released last month.
The 10 states to face some of the largest increases are: Delaware (100 percent), New Hampshire (90 percent), Indiana (54 percent), California (53 percent), Connecticut (45 percent), Michigan (36 percent), Florida (37 percent), Georgia (29 percent), Kentucky (29 percent), and Pennsylvania (25 percent.)
Mark Bertolini, the CEO of Aetna, the third-largest health insurer in the country, warned about this issue in 2012, but it was dismissed as just fear mongering.
What does all of this mean? Within the next decade, premiums will rise even higher because coverage mandates will heighten due to the fierce lobbying initiated by a large number of healthcare sectors, such as acupuncturists, fertility specialists, and chiropractors. Essentially, health insurance costs are likelier to rise than go down, despite what the president promised when he first ran for the Oval Office.
But what about businesses?
For the past couple of years, it has been widely reported of some of the biggest companies in the United States today are reducing their staffing levels, decreasing the number of hours, and cutting back on hiring initiatives. This led many Obamacare critics to deride the law by describing it as turning the U.S. into a “part-time jobs nation.”
A new survey by the non-profit Transamerica Center for Health Studies discovered that more companies are finally starting to adapt to the rules, regulations, and costs of Obamacare. Small businesses, though, were the least likely to offer health coverage, understand their coverage options, and add benefits.
Earlier this year, the Centers for Medicare and Medicaid Service (CMS) reported that Obamacare will cause higher premiums for 11 million small business workers, and an additional 6 million employees would become aware of premium reductions. In addition, CMS officials say the heightened costs will be paid for by younger and healthier workers, while older and sicker workers would see their premiums fall.
At the time the report was published, a group of small businesses said that this was just another report identifying the unintended consequences and negative effects of the president’s healthcare reform plan that would hurt future businesses and start-ups — an area that has been rapidly declining since the beginning of the Great Recession.
“It’s officially time to change the name of Obamacare to The Unaffordable Care Act,” NFIB Director of Federal Public Policy Amanda Austin told Fox Business News. “Perhaps the biggest takeaway is the lengths that the Administration will go to hide the runaway costs for a health care law that is neither affordable nor workable.”
Even the public sector is feeling the effects of Obamacare. The New York Times reported in February that public sector organizations are cutting hours for their employees in order to avoid doling out healthcare coverage. This includes cafeteria workers, school administrators, police dispatchers, and prison guards.
Businesses are also forecasting potential costs of Obamacare by skimming down their workforce numbers. In 2013, a survey of Chief Financial Officers (CFO) found that businesses with 50 or more employees were working on plans to slash their employment levels and their workers’ weekly hours.
Obamacare will also bring about an array of new taxes. For the past couple of years, a number of Obamacare-related taxes have been added. Moving forward, various taxes will still be added. Here is a brief snapshot:
• Obamacare Surtax on investment income
• Obamacare high medical bills tax
• Obamacare Medicare payroll tax increase
• Obamacare employer mandate tax
• Obamacare tax on union member and early retiree health insurance plans
Frank Keasler, who works in the employee benefits industry, says, “This is something that will define a generation and a president’s tenure. Something this polarizing has the potential to change the discourse of the entire nation. And it will, on the financial front. Businesses large and small are being forced to spend differently, and forecast spending differently. So much has changed in such a short period of time. Without properly educating themselves on the issue, Americans are really doing themselves a disservice.”
At the end of it all, American citizens and businesses won’t just be dealing with higher costs, but also longer wait times and even perhaps diminished quality. The U.S. is already facing a shortage of 20,000 doctors and nurses, but within the next decade that number is projected to reach more than double, to 52,000, which will be needed to meet the demands of the influx of millions of patients.
One of the biggest healthcare industries today is urgent care clinics, a sector that is experiencing annual growth of 10 percent. With a paucity of access to hospitals and family doctors, and the expected cuts in entitlements, more immediate care clinics will be in operation in the future.
To summarize, here are some facts you need to know:
- Individuals and families must have health insurance or pay a penalty
- If you already have a plan, then it will change and you’ll have to pick a new one
- Insurers will not be able to reject you if you have a pre-existing health condition
- Children can be on your health policy until they’re 26 years old
- Costs are unlikely to decrease within the next 10 years
What does its long-term future hold? Well, experts say that as long as the Republicans refuse to offer an alternative — aside from just saying they would repeal Obamacare — it’s here to stay.
“Just talking about repeal is not going to make it with 7 million people getting insurance on the exchange. And it has to be something reasonably credible … it can’t just be repeal. We are beyond that,” said economist Gail Wilensky.
More about Obamacare, Frank Keasler, Business
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